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Derek Lowe The 2002 Model

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Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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November 10, 2004

Cui Bono?

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Posted by Derek

Holman Jenkins has an interesting "Business World" column in today's Wall Street Journal. Writing about Merck and Vioxx, he wonders:

"Did CEO Ray Gilmartin blunder in withdrawing Vioxx from the market? Merck executives yanked the prescription pain reliever, amid much backpatting, when a study revealed that long-term users were at somewhat elevated risk for heart attacks and strokes.

Merck was evidently bidding for public admiration in sacking its biggest revenue spinner. If so, the tactic seems to have failed catastrophically. And contrary to the tone of much recent coverage, doctors had long understood that patients taking Vioxx would suffer more heart attacks than patients taking conventional pain relievers."

I didn't think that Merck was looking for good-conduct points, actually - what changed was that there was finally a large-scale study that showed irrefutable evidence that there was a cardiovascular problem. Jenkins goes into this a bit, but I think that it's clear that if Merck wasn't going to act, then the FDA would have forced them. Perhaps that's the only good PR that they might have been hoping to salvage. He goes on to make a very useful point:

"Merck chose to withdraw the drug, although honesty would have been equally well-served by a big informational campaign saying: "Don't prescribe this for patients not at risk for stomach bleeding. Don't let patients become chronic users."

Given that market surveys show that two-thirds of Cox-2 users don't need them, Merck's revenue hit would have been devastating in either case. But it would have made the point that Vioxx is not a defective product -- all drugs have risks that have to be weighed against their benefits -- but a seriously overprescribed one.

The Vioxx debacle is symptomatic of a system that shields consumers from price signals and sometimes actually discourages them from making the right health-care choices. . .Big Pharma is well along in being corrupted by third-party payership, just like the rest of the health-care industry. Drug makers increasingly aim their development efforts at the aches, pains, insecurities, heartburn and erectile dysfunction of price-insensitive, over-insured baby boomers because that's where the money is.

The problem is compounded by a regulatory system that drives the cost of developing a new drug to a billion or more, then forces companies to recoup all their costs in a few short years before the patent expires. This basically forecloses a great deal of investment in drugs that don't fit the above description, such as vaccines or antibiotics."

Unfortunately, there's an awful lot of truth in that. Since we're a business, we are always going to look for where the most money can be made. Other things being equal, underserved markets would be some of those places. But with the increasing difficulty of finding drugs and getting them to market, the pressure to get your few, rare shots to land right has increased. Thus the situation that Jenkins describes - and this is where I part company with the Marcia Angells and Merrill Goozners of the world.

They see the current situation and say "See! The big drug companies are just going for the big profitable diseases! That's why pharmaceuticals are in the shape they're in!" And from our end, it looks more like "Things are in such bad shape that we'd better stick to the big, profitable diseases. If we spend all our time targeting the others, we'll go under!" It's a cause-and-effect argument.

And the larger point stands as well: I think that companies should, in fact, shoulder blame for promoting Cox-2 inhibitors as if they were the right choice for everyone, and for pushing things like Nexium over Prilosec (and Prilosec over the older drugs in the category, for that matter.) But there's plenty of blame to go around.

Physicians have to write prescriptions for these things for us to sell them. Have the doctors been stampeded by our marketing departments, bribed by our piles of loot, or are they worried that if they don't write for these drugs then the next doctor will? And what about the insurance companies who are paying for all this stuff? To me, those are the people whose actions make the least sense.

Comments (5) + TrackBacks (0) | Category: Drug Prices


1. jeet on November 11, 2004 11:40 AM writes...

I don't agree with the logic in the article. The author advocates that relaxing the drug development requirements will lead to safer drugs. My only reaction to that line of thought is b*llsh*t.

If he isn't arguing that, then the paragraph about how oppressive the regulatory system is shouldn't be in the article. I think he is using the Vioxx case to advance an agenda that has little to do with drug safety, or more importantly, the responsiblity of the pharma companies and the FDA, in the post-approval period.

In general I think pharma companies should have the leeway to promote their products beyond the initial study group. It is a good way to recover all the invested dollars, leaves decision making in the doctor's hands, and encourages additional clinical investment in indications that are too small to support a stand alone discovery and development program.

In this case Merck may have abused the system. It looks like they promoted Vioxx on it better safety record compared to NSAIDs. NSAIDs may cause gastric bleeding, Vioxx does not; the drugs' effectiveness is similar.

Now it looks like the company was trying to hide results indicating that serious, additional risks were present.

To me, that looks like abuse, not a failure of current system that requires companies to conduct large-scale tests for safety and efficicay.

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2. steve on November 12, 2004 5:18 PM writes...

An ex girlfriend of mine was a nurse and became a drug rep. (Not with Merck, but another very large pharma) This was a much easier life, and more money. Brought doctors $50 lunches while she chatted them up about the company meds. Does that kind of thing cause docs to prescribe the latest, more expensive meds, when adequate, better, cheaper alternatives exist? I suspect her company knows it does, because they spent a lot of money on it. If it does, it's a systemic problem which can't easily be fixed, because of course companies have to be free to promote their wares. But if Merck was encouraging their sales staff to mislead or misdirect concerned doctors, then i'm confident and hopeful that they will pay the appropriately stiff consequences. Dishonest dealings, in regard to important medical decisions, for personal gain, is a foul thing.

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3. Rick on November 14, 2004 7:13 PM writes...

I am under the impression that Prilosec was the first PPI on the market. Surely you don't mean to compare it to histamine blockers? I can assure you that they are not interchangeable

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4. Derek Lowe on November 14, 2004 9:31 PM writes...

No, what puzzles me is just the split among the two proton-pump inhibitors. I can't imagine that there's a useful amount of difference between Nexium and Prilosec, so why does insurance pay for Nexium?

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5. Rick on November 14, 2004 9:53 PM writes...

Probably because Hell hath no fury like a patient with a drug benefit told to take an OTC product.

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