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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

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: derekb.lowe@gmail.com Twitter: Dereklowe

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In the Pipeline

« Give The People What They Want | Main | More On Doing Away With Patents »

April 2, 2006

Down With Patents, Eh?

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Posted by Derek

I see that Against Intellectual Monopoly by Michele Boldrin and David Levine is about to be released. This is a provocative work, parts of which have appeared in articles over the last couple of years. The first few chapters are available online (still with some typos, I've noticed).

What makes this a bomb-throwing sort of book, from the perspective of a drug company researcher like me, is that the authors recommend abolishing the patent system as we know it. They have a chapter (PDF) on the drug industry specifically, as you'd expect. Looking it over, I find it a peculiar mix of compelling argument and things that make me hold my head and moan. For instance, the authors, in all their discussion of the German and Italian drug industries, don't seem to take into account the way these industries have been able to make money over here.

I'm open to the idea that there might be other ways to encourage innovation than the patent system we have now. But Boldrin and Levine seem to have bought into the whole it's-the-government-that-finds-drugs idea, which never fails to drive me insane. (See this category for more on the same topic here).

Here's just one example of a hold-my-head section:

Much of the case for drug patents rests on the high cost of bringing drugs to market. Most studies have been sponsored by the pharmaceutical industry and are so quite suspect. The Consumer Project on Technology examined the cost of clinical trials for orphan drugs – good data are available for these drugs because they are eligible for special government benefits. A pharmaceutical industry sponsored study estimated the average cost of clinical trials for a drug at about $24.5 million 1995 dollars. However, for orphan drugs where better data are available, the average cost of clinical trials was only about $6.5 million 1995 dollars – yet there is no reason to believe that these clinical trials are in any way atypical.

There aren't? How about the fact that they're often first-in-class therapies, and thus can have a lower efficacy standard (better than nothing!) to meet? Or the fact that they're orphan drugs, meaning that there's a limited patient population available to start with? There are cardiovascular drugs that have been through trials in more patients than the total market size of some orphan therapies. No, there are some deficiencies here.

For a worried take on Boldrin and Levine's work, see Arnold Kling, and for its application to the drug industry, this post at Samizdata. Here's some more discussion on the same topic.

Comments (53) + TrackBacks (2) | Category: Patents and IP


COMMENTS

1. wcw on April 3, 2006 12:02 AM writes...

Kling's take is mostly on copyright. I tend not to see his arguments there nearly as well as I see yours here -- there's a long history of human beings writing and making music with zero or extremely limited copyright. There's a very long history of folkloric drug discovery (e.g., willow bark) with no patents, but little history of modern drug development. Your argument is the better without hitching it to his copywritten steed.

Like both he and you, I can't get overexcited about this particular critique of patent, but in the one-click world it's pretty clear patents are broken. Whether the system is so broken it needs to be scrapped is doubtful, but right now I'd argue that outside of pharma (which really is a special case) patents almost certainly act more as an impediment than as a spur to progress.

If you think "the rules" exist as a way to try making society work fairly for everyone, you can't be happy with rules that impede progress.

Permalink to Comment

2. PS on April 3, 2006 12:51 AM writes...

"There are cardiovascular drugs that have been through trials in more patients than the total market size of some orphan therapies. No, there are some deficiencies here."

Well Derek, if you are referring to mostly "Me Too" drugs here, then they dont really count

Permalink to Comment

3. Robert Paci on April 3, 2006 1:21 AM writes...

On matters pharmaceutical, Boldrin would do well to heed the advice he dispenses so prominently on his home page:

"Whereof one cannot speak, thereof one must be silent."


Permalink to Comment

4. Petros on April 3, 2006 2:13 AM writes...

While new drugs may have emerged from Italy when there was no patent protection for pharmaceuticals are there any significant drugs within that group ?

Permalink to Comment

5. Derek Lowe on April 3, 2006 6:23 AM writes...

PS, the usual critique is that "me too" drugs are just Big Pharma taking the cheap and profitable way out. Via gigantic clinical trials? That's the cheap way out?

And you can find plenty of new-mechanism drugs that have to go through huge trials. They're not me-toos, since they work differently, but they have an existing standard of care to worry about, too. I wonder how many patients rimonabant has been in?

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6. JSinger on April 3, 2006 9:01 AM writes...

1) If someone can run a profitable, patent-free pharmaceutical company, you can bet I'll be sending over a resume. It's unfortunate that the people proposing these schemes only seem interested in creating the conditions for utopia but leave it to us to implement it. When Boldrin and Levine get their first FDA approval, let me know.

2) I also don't get why the "The pharmaceutical companies bribe the doctors!" line (which may or may not be valid, I have no idea) is only invoked as a criticism of the pharmas. Why does it never seem to be a criticism of the doctors, who are supposedly subject to higher ethical standards than the reps they golf with?

3) I only skimmed their historical reasoning, but it seems like their success stories aren't so much patent-free as they are free-riding on other countries' patent systems.

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7. Palo on April 3, 2006 10:39 AM writes...

Predictably, I completely agree with Boldrin and Levine. Predictably, Derek rejects their work by arguing only minor points. I can later discuss those points, but the key paragraph to me is the one referring to me-too drugs, as it is indeed a monster created by the patenting system itself.

... [this represents] a substantial amount of socially inefficient rentseeking, artificially created by the patent system itself. Insofar as new drugs are replacements for drugs that already exist, they have little or no economic value – yet cost on the order of $800 million to bring to market because the existence of patents forces the producers to “invent something� the USPO can pretend to be sufficiently different from the original, patented, drug. Where does that money go? What are the social gains from this kind of investments? None
....
Money spent in obtaining a “me-too� drug that can be patented is money wasted for society that will be charged to consumers: Rent-seeking and monopoly profits can be very costly for all of us, indeed

Of course, we'll hear the regular chorus of Church of Pharma reciting how wonderful me-too drugs, but none of us, themselves and us skeptics, believe there is much truth in that. It's only the lyrics for the brochures their lobbyists take to Washington.

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8. JSinger on April 3, 2006 10:52 AM writes...

Palo, the piece you're quoting is pure gibberish. Either a new drug offers no advantage over existing competition, in which case there's no rent to be seeked, or it's worth a premium, in which case their argument evaporates.

The authors realize that, of course, which is why they're dependent on invoking bribery of doctors to avoid the realities of Econ 101. That may or may not be a meaningful point, but surely there are more effective ways to reform medical marketing than by eliminating any economic incentive to do research.

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9. Palo on April 3, 2006 11:19 AM writes...

Either a new drug offers no advantage over existing competition, in which case there's no rent to be seeked, or it's worth a premium, in which case their argument evaporates

We must have a different definition of gibberish. I doubt that you really believe what you say. I doubt that you believe there is a real advantage to Clarinex over Claritin or Nexium over Prilosec. Only a drug rep with no understanding of chemistry can believe that, and only after substantial brain-washing. Or an innocent patient given free Nexium samples. How much money was spent in marketing Nexium (amazingly among the top 5 best seller drugs) and Clarinex? Billions. Who pays for that wasted marketing? patients.

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10. Sigivald on April 3, 2006 1:31 PM writes...

Palo: Really? You have to be brainwashed and ignorant to believe there's no advantage to, say, Claritin vs. Clarinex, or Nexium vs. Prilosec?

I assume you have the clinical studies to back that up, right?

(And an "innocent patient" given Nexium samples? As if it's a punishment, rather than a treatment for heartburn?

And how is marketing "wasted"? Please be clear and define the term. Evidently those paying for it don't see it as wasted, but as increasing their overall income (and thus paying for ... more drug discovery and more production research and new equipment, making the next big thing that much more doable).)

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11. Katherine on April 3, 2006 1:43 PM writes...

Now wait a minute. I'm as big a defender of pharma as you'll find outside the wonder drug factories, but Nexium? Don't tell me you're defending Nexium as some great scientific advance over Prilosec. If we all paid out of pocket for our prescriptions, everyone would still be taking Prilosec and Claritin, and the me-toos wouldn't have been worth the money it took to bring them to market.

Permalink to Comment

12. Palo on April 3, 2006 2:02 PM writes...

Oh, give me a break Sigivald. You know there's marginal, if any, improvement by nexium. And Derek has addressed in the past the 'advantage' of Clarinex over Claritin: if you took Claritin, 20 minutes after intake you actually took Clarinex:
http://pipeline.corante.com/archives/2002/05/06/claritin_and_clarinex.php

Of course I know marketing is a great tool for maximizing profit. Exactly the point: marketing as a replacement for innovation. When I talk about "wasted" marketing costs, I'm obviously talking about the cost to society (wasted resources that could be used in actual research, lower prices for the consumer, etc.), not the drug maker.

And when I talk about an "innocent" patient, I obviously refer to the fact that the patient doesn't know that the generic version of Clarintin is the same as the more expensive Clarinex, but is 'hooked' on Clarinex because he/she was given free samples.

Permalink to Comment

13. Jake on April 3, 2006 2:17 PM writes...

If people are going to restrict "me-too" to mean drugs in the class of Nexium and Clarinex, yeah, they're pointless. But the usage I've always seen previously has been for things like Lipitor/Zocor/Crestor/Pravastin and Vioxx/Celebrex/Bextra, where there are many drugs using the same general method of action.

(after all, how can Clarinex be "me, too"? Schering-Plough made Claritin, Schering-Plough makes Clarinex. Who else is involved?)

Permalink to Comment

14. SRC on April 3, 2006 2:22 PM writes...

A modest proposal: one of us buys this book, scans it, and sends a PDF of the entire book to anyone and everyone who wants it.

I don't see any problem with that. Do Boldrin and Levine?

Permalink to Comment

15. JSinger on April 3, 2006 2:35 PM writes...

The back-and-forth about Nexium and Clarinex misses the point. Today's question isn't whether pharmaceutical marketing does or doesn't introduce inefficiencies. It's whether it's reasonable to address such inefficiencies by eliminating the only mechanism that makes innovation profitable. Surely there's an approach with greater specificity that could be used -- if Boldrin and Levine ever decided to try their hands at making drugs themselves, it seems like they'd compete with Claritin by decapitating patients.

Permalink to Comment

16. Palo on April 3, 2006 3:20 PM writes...

Jake says,

If people are going to restrict "me-too" to mean drugs in the class of Nexium and Clarinex, yeah, they're pointless. But the usage I've always seen previously has been for things like Lipitor/Zocor/Crestor/Pravastin and Vioxx/Celebrex/Bextra, where there are many drugs using the same general method of action.

Fine. Take the cholesterol lowering drugs if you want. Are the billions invested in clinical trials, marketing and manufacturing similar drugs worth the difference? For a tiny population the answer might be yes. For the population in general it would be a resounding no. It would be a lot more productive to spend that money on developing innovative drugs to fight cancer, or cystic fibrosis. The obvious and the less obvious me-too drugs both illustrate the problem with the patenting system that rewards creative ways to maintain property rights more than innovation.

(after all, how can Clarinex be "me, too"? Schering-Plough made Claritin, Schering-Plough makes Clarinex. Who else is involved?)

Precisely. What a fine irony of our glorious system: a company finds marketing a copy of its own drug more lucrative than innovation.

Jsinger says,

Today's question isn't whether pharmaceutical marketing does or doesn't introduce inefficiencies. It's whether it's reasonable to address such inefficiencies by eliminating the only mechanism that makes innovation profitable.

According to the authors marketing is not simply a source of inefficiencies, it is a consequence of inefficiency. You need a lot of marketing when you have nothing new or better to sell. The point they make is that the monopoly system is rewarding lack of innovation. They go a long way on the historical background showing that the patent system as we know it is NOT "the only mechanism that makes innovation profitable", but it is one that makes marketing-over-innovation more profitable.

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17. LNT on April 3, 2006 3:41 PM writes...

This may be an obvious point, but drug companies do have to protect thier research investment somehow. Currently the ONLY two ways to protect that investment are patents and "trade secrets". Keeping the structure of a drug a "trade secret" is ludicrous because all the competition would have to do is buy the pill and take an NMR to get the structure.

It's actually a silly arguement. There HAS to be some sort of protection for intellectual property. The patent system we have may suck, but unless Palo has some wonderful suggestions, we're stuck! To quote my favorite Bushism: "A litany of complaints is not a plan!"

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18. Buddha on April 3, 2006 3:42 PM writes...

Palo,
Do you honestly believe marketing is a replacement for innovation? I suppose the scientists are sitting on their thumbs while the sales reps are out marketing their portfolio of products. Spare me with the cost to society BS. I have heard this sense of entitlement tone before and frankly it is nauseating.

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19. ME on April 3, 2006 4:32 PM writes...

>>Do you honestly believe marketing is a
>>replacement for innovation?

Big Pharma certainly does...the R&D engines can be sourced in India, China, etc. Whats wrong with marketing innovation?

>>I suppose the scientists are sitting on their
>>thumbs while the sales reps are out marketing
>>their portfolio of products.

No, the scientists get punted long before that.

>>I have heard this sense of entitlement tone >>and frankly it is nauseating.

Yeah, who said Big Pharma was entitled to a patent system? I mean come on...the world is flat...pass around the Friedman books. HAHAHA

Permalink to Comment

20. ME on April 3, 2006 4:47 PM writes...

>>There HAS to be some sort of protection for
>>intellectual property.

Wrong. If the software development world can do without then I suggest you take the same medicine pardon the pun.

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21. LNT on April 3, 2006 4:52 PM writes...

ME,
Software developers have no protection for IP? I suggest you copy MS Word and then give Bill Gates a call to tell him about it. A copywrite affords essentially the same protection as a patent. Unfortunately, you can't "copywrite" a composition of matter.

Permalink to Comment

22. Palo on April 3, 2006 4:59 PM writes...

Do you honestly believe marketing is a replacement for innovation? I suppose the scientists are sitting on their thumbs while the sales reps are out marketing their portfolio of products. Spare me with the cost to society BS. I have heard this sense of entitlement tone before and frankly it is nauseating.

Don't get too cute, Buddha. Of course there are working scientists (I am one of them) and there is innovation. The question is whether marketing allocations by pharma are shifting too heavily to marketing at the expense of research, and all evidence says it is.

If society's costs are BS to you, that says a lot more about you than you think it says about my arguments. The only entitlements here are the obscene state-supported (via patents) profits some companies make at the cost of a health care bill that many families cannot pay. If this is nauseating to you, again, it says a lot more about you than anything else. In any case, I suggest you engage on some constructive discussion instead of cheap diatribe.

Permalink to Comment

23. Sebastian Holsclaw on April 3, 2006 5:04 PM writes...

"For a tiny population the answer might be yes. For the population in general it would be a resounding no. It would be a lot more productive to spend that money on developing innovative drugs to fight cancer, or cystic fibrosis."

Are we in an alternate universe where the cystic fibrosis foundation doesn't have $140+ million per year? Not bad for a 1 in 2500 disease. Is the US a country where cancer research doesn't occur?

Permalink to Comment

24. Palo on April 3, 2006 5:10 PM writes...

LNT,
The patent system we have may suck, but unless Palo has some wonderful suggestions, we're stuck!

That's exactly the point the authors try to address. They do propose we do away with the patent system. Other people (they reference some work by Dean Baker at the CEPR) suggest that the cost of patents is way costlier than an 'open source' type of system where the public picks up the cost of the research and companies make their profits competing in production. The public already pays for about half of the research anyway, and judging for the results, a lot more efficiently (most blockbuster drugs were developed by federal-funded researchers).

You are one of many that keep suggesting the patent system as it is the best and that nobody has an alternative. I wish you and others read the whole thing that started this thread, at least the chapter on drug developments (Derek has a link to it) instead of repeating the same tirade. You may not like their proposals, but by all means, they do propose alternatives!

Permalink to Comment

25. Palo on April 3, 2006 5:22 PM writes...

Are we in an alternate universe where the cystic fibrosis foundation doesn't have $140+ million per year? Not bad for a 1 in 2500 disease. Is the US a country where cancer research doesn't occur?

Sebastian, for crying out loud, don't argue with straw men. Of course there is research in Cystic Fibrosis and Cancer. Of course. The question is whether instead of 140 million, there would be, let's say, a billion dollars available to find a cure for CF. What's a billion dollar? The amount of money spent only on marketing Nexium, an innecessary me-too drug. Inadvertantly you make my point: CF=140 million, marketing Nexium=1 billion
In an alternative universe maybe people would be very interested in redirecting expenses from non-productive marketing of duplicated drugs into investment in research for diseases for which there are no present cures.

Permalink to Comment

26. Palo on April 3, 2006 5:25 PM writes...

Are we in an alternate universe where the cystic fibrosis foundation doesn't have $140+ million per year? Not bad for a 1 in 2500 disease. Is the US a country where cancer research doesn't occur?

Sebastian, for crying out loud, don't argue with straw men. Of course there is research in Cystic Fibrosis and Cancer. Of course. The question is whether instead of 140 million, there would be, let's say, a billion dollars available to find a cure for CF. What's a billion dollar? The amount of money spent only on marketing Nexium, an innecessary me-too drug. Inadvertantly you make my point: CF=140 million, marketing Nexium=1 billion
In an alternative universe maybe people would be very interested in redirecting expenses from non-productive marketing of duplicated drugs into investment in research for diseases for which there are no present cures.

Permalink to Comment

27. Sebastian Holsclaw on April 3, 2006 6:01 PM writes...

Where do you get marketing of a billion dollars for Nexium? According to Astra-Zeneca's filing the drug only made three billion. Are you aware that there are more users of Nexium in the state of California then there are people who suffer from CF in all of the US? There is a question of scale. Are you also aware that some diseases don't get cured by throwing money at them--especially when the government does it?

Also their history is kind of silly. They rely on a lot of their pre-patent history of drug development from a period where figuring out what was in a pill and reproducing it wasn't as easy as it is today. Patent protection wasn't as crucial in the earlier days of medicinal chemistry because replication wasn't so trivial. They play an interesting trick of saying that the French patent system strangled chemical production industries (allowing the Swiss to develop) while apparently the US system keeps big pharma companies unfairly in power--contradiction unexplained. Their Italy data is crappy--first they can free ride off profits in the US, second what kind of a measure is "active chemical compound"? Wouldn't that value a cure for all cancer the same as a new paint thinner? Their definition of redundant drug is silly. And by the way, if you don't experience a drug side effect from an older generic you can take it. You are aware of that right? Because they don't seem to be. They seem to be unaware of the existance of the FDA in "But this could be achieved, much
more rapidly and at a cost orders of magnitude smaller, by simply
copying the old drug, and improving upon it."

I have an idea, why don't we have some European government fund lots of research with the express proviso that the beneficiary will A) not have a patent and B) not be allowed to sell in the any market at say twice the marginal per pill cost. When that market becomes the leading discoverer of useful pharma products, we will throw away the current system held by leading discoverer of useful pharma products. Any takers? Surely they don't need the US profits....

BTW, the idea of you chastising someone for arguing with strawmen is almost comical.

Permalink to Comment

28. PS on April 3, 2006 6:01 PM writes...

Lets see, Company A brings an innovative (maybe first in class) drug on the market. Companies B, C, D etc. look to cash in and come up with their own Me-Too versions of it.

So whats the big deal - competition is good for the consumer.

But as far as I understand, the vast majority of consumers in general do not benefit from having multiple Me-Toos on the market. Its not that the competition is making the drug cheaper for the consumer. In fact, the consumer is indirectly (via increased insurance premiums) paying more for additional expensive clinical trials and for the marketing of mutiple Me-Too drugs.

Maybe someone can do a cost-benefit analysis and convince me that having mutiple me-toos are good for the consumer and society in general.

As a side bar - I had lunch with an ex-pharmacia guy who laughed at their management for *wasting* money to develop Linezolid, a first in class antibacterial agent (and really very nice work), because it was making less than a billion $s a year.

I think the above personifies attitudes in big pharma - the bastian of innovation and moral standards - that really nice work that results in a first in class compound is a waste if it does not attain blockbuster status.

Permalink to Comment

29. Palo on April 3, 2006 6:03 PM writes...

For the record: The Cystic Fibrosis Foundation's budget for research is around 46M, not 140M as Sebastian suggested. Ironically enough, that's almost the same amount of money the CF Foundation spends on .... buying prescription drugs (41M).

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30. Buddha on April 3, 2006 6:50 PM writes...

"The public already pays for about half of the research anyway, and judging for the results, a lot more efficiently (most blockbuster drugs were developed by federal-funded researchers)."
Palo-please enlighten us. Could you please list the blockbuster drugs developed by federal funds. If that is the case, maybe you should direct your disdain at the government and not the pharma industry.

Permalink to Comment

31. Palo on April 3, 2006 7:12 PM writes...

Sebastian asks:
Where do you get marketing of a billion dollars for Nexium? According to Astra-Zeneca's filing the drug only made three billion.

According to a New Yorker article, AstraZeneca spent only half a billion dollars in marketing and advertising just in the year following the launch, and according to the Boston Globe, it spent $250M the first year. So, extrapolating to the other 4 years of marketing, 1 billion doesn't sound too far fetched, if anything, it might be short.

Btw, according to Forbes, Nexium made $5.7 billion only last year.

Are you aware that there are more users of Nexium in the state of California then there are people who suffer from CF in all of the US? There is a question of scale .

I wasn't. But considering that CF kills by the age of 40, and usually during childhood, and considering that Californians with acid indigestion have plenty of alternatives, like Prilosec, there's a question of scale for you. What do you prefer, providing unnecessary duplicative drugs to Californians or investing in saving 1 in 2500 deaths?

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32. Buddha on April 3, 2006 7:52 PM writes...

Palo,
You reference CF quite a bit in your comments. My (limited) understanding is that it is a genetic disease resulting in the excess excretion of mucus in the lungs. My question is-Is there a GPCR out there waiting to be antagonized that would help CF? I would guess not. This type of disease may not be helped by what pharma does best-make small molecule antagonists/agonists. Is there an animal model for CF? Is is possible that the approach to treating this disease lies outside the expertise of the pharmaceutical industry?

Permalink to Comment

33. qetzal on April 3, 2006 9:37 PM writes...

Another thing that seems to be missing from Boldrine & Levine's analysis is the regulatory burden.

Whatever one thinks is the "true" cost of bringing a drug to market, it's an indisputable fact that a large chunk of that cost comes from the work required to meet FDA approval standards (in the US, at least).

Suppose Pharma A spends $50M to prove the safety and efficacy of a new drug, and another $50M to establish high volume manufacturing and distributing. (Note that $100M to get a new drug approved is certainly too low.)

Once the new drug is approved, what stops Pharma B from spending only $50M on the manufacturing, and undercutting Pharma A? Answer: patents.

Without patents, would Pharma A spend $100M to develop the drug, knowing they'd quickly be undercut by Pharma B? Answer: no.

It doesn't surprise me that much of the evidence cited to show that drugs can be profitably developed without patent protection comes from a period before there was much if any regulatory burden.

So, if patents are eliminated, will regulatory burdens also be relaxed? Sounds like a tough sell to me. I think the only other alternative would be government take-over of all drug development (perhaps with private competition over production and marketing of approved drugs, as suggested above).

Would government-run drug development be more efficient? Possibly, but government-run businesses in other areas don't have such a great track record for efficiency, do they?

It's hard to ascribe much credibility to B&L's essay when they don't address something as fundamental as regulatory costs. Then there are statements such as this:

"A 2002 report of the Center for Economic and Policy Research also estimates costs orders of magnitude less than those claimed by the pharmaceutical companies."

That's a ludicrous estimate. Pharma claims it costs on average $800M/drug. Are they seriously alleging the true cost could be as low as $8M?! That's just outright ridiculous.

B&L's obvious hostile tone further detracts from their arguments.

I have no doubt that the pharma industry has numerous inefficiencies. I also have no doubt there are ways the patent & regulatory system could be tweaked to make things better. How much better, I'm not sure. Unfortunately, it doesn't seem to me that B&L have a clear enough (or unbiased enough) perspective to offer much useful insight.

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34. PS on April 3, 2006 9:43 PM writes...

"Is there an animal model for CF? Is is possible that the approach to treating this disease lies outside the expertise of the pharmaceutical industry?"

This is funny and typical. If something is a little difficult or challenging - it becomes outside the scope of expertise for big pharma (not the pharmaceutical industry!!).

And yes, while we are on the topic of what constitutes innovation - making agonist/antagonist for GPCRs is what big pharma does the best.

FYI, one of the therapies for the management of cystic fibrosis in patients with Pseudomonas infection is Tobi (Tobramycin inhalation solution) - developed by Pathogenesis until they got bought over by Chiron.

Permalink to Comment

35. Palo on April 3, 2006 9:50 PM writes...

Buddha says,

Palo-please enlighten us. Could you please list the blockbuster drugs developed by federal funds. If that is the case, maybe you should direct your disdain at the government and not the pharma industry,

for the list of the blockbuster drugs mainly developed (at least at the pre-clinical stage) by federal money go check out Marcia Angell's "The Truth about pharmaceutical companies" or "The 800 Million Dollar Pill" by Merrill Goozner. They have plenty of examples. They both claim that more than half of the new and original drugs approved in the late 90s to early 2000s were federal-funded discoveries.

I don't understand your last point at all: why would I direct my disdain at the federal government for funding novel drug therapies?

As for CF, it is actually a genetic disease (as in a single-gene mutation) that turned out to be quite complex due to the presence of multiple modifiers, making it essentially a multi-gene disease. There are animal models of CF. I fully understand it is not the best target for pharma business, but that only makes my point simply stronger: if pharma wouldn't spend so much money in developing and marketing frivolous me-too drugs, there would be more available to use in complex disease like CF or Cancer. The fact that it is not a good business plan for pharma to take on those tells you right away that the profit-for-innovation through monopoly rights is a lousy model for drug development.

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36. PS on April 3, 2006 9:50 PM writes...

"That's a ludicrous estimate. Pharma claims it costs on average $800M/drug. Are they seriously alleging the true cost could be as low as $8M?! That's just outright ridiculous."

Well, thats $400 million for research/development and clinical trials and the rest for marketing. Now add a similar amound for every me-too (needed or not needed) introduced and you are talking about some serious cash.

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37. SRC on April 3, 2006 10:02 PM writes...

A second modest proposal: before someone can comment on pharma patents we have something like butterfly ballots that they first must negotiate successfully, so we can discourage the cognitively disenfranchised from braying nonsense about, e.g., most drugs coming from Federally-funded research, or me-too drugs that provide no incremental benefit, but that people have to buy for their life-saving properties, or that software, which has a shelf life less than a mayfly, typically doesn't have patent protection.

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38. PS on April 4, 2006 12:04 AM writes...

"or me-too drugs that provide no incremental benefit, but that people have to buy for their life-saving properties"

people dont buy me-toos, their insurance companies do (and indirectly all of us via higher insurance premiums). And if a me-too is all a company can show for innovation then they dont deserve the same patent protection - unless the me-too demonstrates some truly unique properties that offer a real benefit over the first in class therapy.

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39. Buddha on April 4, 2006 5:58 AM writes...

One more post on this lively topic...
If marketing dollars didn't translate into profits than pharma companies wouldn't waste their money. The question is whether or not this marketing restults in atttracting patients who actually need the drug and thereby hopefully improving their quality of life. Palo are you implying that marketing leads to the prescribing of a drug to people who don't need it? Is that why you seem incensed with the big pharma marketing machine? If so, you may have a point however you have yet to prove it.

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40. SRC on April 4, 2006 12:39 PM writes...

people dont buy me-toos, their insurance companies do

Ah, there's the rub. People may not always make rational decisions because of the moral hazard implicit in having someone else - in this case, an insurance company - pay for the benefit they receive.

And if a me-too is all a company can show for innovation then they dont deserve the same patent protection - unless the me-too demonstrates some truly unique properties that offer a real benefit over the first in class therapy.

Sigh. Think about the mechanics of this. Would patent applications have a box for "me-too drug, with no 'truly' unique properties that offer a real benefit over the first in class therapy"? Who decides whether it gets checked? The applicant? The PTO (i.e., the same people who are now issuing the patents you don't like)? The courts? How much benefit qualifies as "real"? How about an increase in half-life, but a smaller therapeutic index? Or vice versa? What about a decrease in side effects in most people, but graver ones in a small subset? How about substitution of one side effect for another? You see the problem.

Think further about this. What's magical about drugs? What about other products? Why should there be "me-too" cars? Maybe we should have just one government-approved car. We could call it the "Trabant."

And what's wrong with me-too drugs anyway? If you don't think they provide any additional benefit, don't buy them. Simple. The long and short of it is that, if left alone (i.e., absent distorting influences, such as insurance), the market works. Lots of people drive SUVs. I don't think they're worth the money. Guess what? I didn't buy one. Easy.

The risible portion of these types of suggestions is the notion that patents impede innovation, and this sort of proposal would promote it. The vast majority of inventions in all fields are incremental improvements (i.e., the sort of "me-toos" that are being criticized); earthshaking breakthroughs are rare. People are still tweaking plows, for crying out loud.

Now as for my butterfly ballot anti-nitwit interlock device, that's a real breakthrough, although unfortunately it's in the prior art.

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41. PS on April 4, 2006 1:08 PM writes...

"Think further about this. What's magical about drugs? What about other products? Why should there be "me-too" cars? Maybe we should have just one government-approved car. We could call it the "Trabant.""

Are you implying that selling pharmaceuticals is the same as selling cars. There is a difference here. You pay for your car - the insurance companies pay for your medication.

Society pays a big premium to the pharmaceutical industry to do research and come up with new medicines - a premium that I think is well justified.

But now it appears that big pharma is using that premium to pay for marketing campaigns to stuff medication down our throats, whether we need it or not. And no, I dont think you can simply just say - if you dont need it dont take it, no one is forcing you to.

And just how can you justify pharmacists/drug reps making 150-200K/year, when some old lady living on 25K/year cant afford her medication. I am not saying that we need to convert to a socialist system here, but there has to be some balance.

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42. Sigivald on April 4, 2006 1:47 PM writes...

Palo: "Marginal" improvement and "no" improvement are not the same thing.

All I ask is accuracy in your sweeping statements about value and improvement.

Glad we agree it's non-zero. (And even if the improvement is slight or only shows up for a subset of the market that can tolerate one variant and not another, it's still there, and more likely to be produced and discovered under patent than not. Especially so, in fact, for the variants that are better only for a subset of people intolerant or un-helped by the first drug!)

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43. Palo on April 4, 2006 2:41 PM writes...

Sigivald,

You did not ask for accuracy, you thought you had me in a 'gotcha' moment and called me brainwashed and ignorant without knowing that the answer to your question would make you look foolish. If you want to play word games to refuse accepting that Clarinex and Nexium are bogus additions to our medical world, I'll amend my statement in regard to Nexium: No improvement. There, that's more accurate.

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44. SRC on April 4, 2006 5:55 PM writes...

Are you implying that selling pharmaceuticals is the same as selling cars. There is a difference here. You pay for your car - the insurance companies pay for your medication.

Really? So…you don't pay insurance premiums? You've got to tell me who your carrier is. Or are they just taken out of your pay, and you don't count that as "paying"? You pay, my friend, whether you have figured it out yet or not.

I've often thought that we should limit health insurance to major medical catastrophes, because frankly, most people aren't bright enough to connect their insurance premiums to healthcare costs, leading to the moral hazard of not caring what those costs are. Paying for routine medical, dental, etc. costs out of pocket and you'll see some much more savvy consumers, pronto, I predict.

But now it appears that big pharma is using that premium to pay for marketing campaigns to stuff medication down our throats, whether we need it or not. And no, I dont think you can simply just say - if you dont need it dont take it, no one is forcing you to.

Whoa. I'm getting intellectual whiplash here, from the juxtaposition of "medication … whether we need it or not" with "I dont think you can simply just say - if you dont need it dont take it." Which is it? Is pharma stuffing unneeded medications down our throats, or gouging sufferers for medicines they desperately need?

And let's go back to the car industry. Why don't they stop those incessant (and expensive) ads showing their me-too cars - and they really are me-too cars, too – driving through mountains at 45 degree angles and spend more on safety research? Why are they spending that premium we pay on new cars to pay for marketing campaigns to stuff new cars down our throats, whether we need them or not? There oughta be a law!

And just how can you justify pharmacists/drug reps making 150-200K/year, when some old lady living on 25K/year cant afford her medication. I am not saying that we need to convert to a socialist system here, but there has to be some balance.

Who decides how much someone should be paid? I, of course, am grossly underpaid compared to my manifest abilities, whereas you, I'm sad to say, are just as grossly overpaid. Why do high school dropouts make hundreds of millions of dollars if they are good-looking and at least bright enough to memorize a script? Or because they're tall, and can throw a ball through a ring? Because other people think that they're worth that much money. Do I agree? No. But my individual views are not relevant – it's the integral over the society that matters.

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45. PS on April 4, 2006 6:28 PM writes...

SRC, I really dont know what you are trying to get at. As in your replies to Palo, your comments make no sense to me (which might be the reason you are grossly underpaid)

"Really? So…you don't pay insurance premiums? You've got to tell me who your carrier is. Or are they just taken out of your pay, and you don't count that as "paying"? You pay, my friend, whether you have figured it out yet or not."

So fine you want to nit pick, I'll change my original post to

"Are you implying that selling pharmaceuticals is the same as selling cars. There is a difference here. You pay for your car - "you and" the insurance companies pay for your medication.

Derek - when you have some time off, please make the above change - with a big quotation mark - in my earlier post.

And if you really think that there should be no difference between selling pharmaceuticals and cars, there is really no point in discussing this issue with you.

And you did guess correctly, I am pretty well compensated, although I would argue with the "grossly overpaid" part.

And now, if you want to correct any spelling mistakes, typos or grammatical errors in my postings, please feel free to do so - but I am out after this one since you appear to be too dense for a meaningful discussion.

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46. PS on April 4, 2006 8:35 PM writes...

Allright, one last one - SRC, I guess you are really dense and condescending, if I might add.

Anyone who remotely understands how the insurance system works knows that the insurance companies just funnel money to the healthcare provider. I assumed that was implied in my earlier posts (I added "you and" since I figured you would bicker about copayments etc. etc. etc.), but you still insist on nitpicking and stating the obvious. My point still remains - Selling pharmaceuticals is not the same as selling cars.

We all dont contribute money into a giant pool so that the sicker ones among us get to drive BMWs and Jags.

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47. SRC on April 4, 2006 9:08 PM writes...

Derek,

Thanks for your good offices. I won't bother reposting.

BTW, PS, my comment about my being grossly underpaid and your being grossly overpaid were not a lament and a prognostication, respectively. They were a joke. You know, for to laugh.

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48. Joe Decker on April 5, 2006 3:06 PM writes...

Of course I'd love to see more research on CF, but I do have to add one thing--personally, I use Nexium to good effect, after having found that Prilosec makes gives me both profound headaches and nausea. I'm not suggesting that this is because the former is some greatly improved version of the latter overall, simply there is some non-zero value to having a few different 'flavors' of a lot of types of drugs.

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49. Cipri on May 1, 2006 11:49 PM writes...

The point, of having a patent system is to reward innovation.

However the time it takes for rewards to be materialised is now much shorter.

It is time for the patent system to be gradually wound back.

Profits from human misery is unacceptable, we need to have a patent system that works for humanity not against it.

Having a monopoly on life saving drugs is like big pharma playing god, like profit deciding who should live.

I can imagine a better world, a better system that works for humanity can you?

i am for a win win (patients and pharma, lets create it.

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50. Chris on May 23, 2006 1:34 PM writes...

I'm a first time reader of this board and am quite surprised. I have never heard of a big pharma company making someone take a new drug. If you don't like the price of drugs approved in the last 10-15 years, please use all the aspirin & penicilin you like. Got cancer? Try taxol, the patent expired years ago. But don't exalt the modern drugs that have drastically reduced side effects out of one side of your mouth while calling them "me-too" drugs out of the other. If you don't want to pay a premium for innovation, then use the drugs for which the premium has expired.

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51. jyoti on May 29, 2006 6:59 AM writes...

Hi, Chris. I too am a first timer like you and am surprised at your comment.
"Got cancer? Try taxol, the patent expired years ago".
As I understand it is not so easy for laypeople to understand and evaluate the complexities of clinical trials , conference proccedings etc. Possibly they would not be able to decide which treatment they should take. It is the doctor who recommends the treatment so whatever info. the patient gets is basically what the doctor gives him/her. But lets admit , not all doctors are totally unbiased and un-influenced by pharma marketing.So in all probability they can influence / convince the patient to go in for more expensive medicines. Therein lies the main difference between buying cars and medicine.When you purchase a car you alone decide and you alone pay but in case of medicine though you or your insurance pays , the purchase influencer / decider is the doctor.

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52. Chris on June 6, 2006 3:35 PM writes...

Jyoti,

Abusive pharma marketing practices certainly can call into question the law & policy of informed consent, but I do not think that it has eviscerated the concept. Doctors still have an obligation to explain choices to patients, and patients are free to request generic or other brand drugs (like I did last week). The fact that doctors generally prescribe newer, patented medicenes is not soley due to marketing, in most cases the drugs have better activity or tolerance profiles. My point is that the better activity or tolerance profiles are relevant factors in balancing the value of the extra expense that patented drugs demand.------ Your analogy to the automotive industry is curious as the average profit margin in the pharmaceutical industry is under one third that of the automotive industry. -----I've spent the last 10 years failing to find a cure for cancer. The assertion that there is no market value to our efforts, or that a new drug we may identify is only successful because of deceptive marketing efforts is frankly offensive to our sincere efforts to solve a global health crisis. Not many career paths actually offer the chance to solve a global problem, it is a shame that we are assaulted by those who can not comprehend the challenges of physiology.

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53. Kama Singh on July 30, 2014 5:13 PM writes...

Thanks

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