The Price of Health (I)

Subtitled “The Modern Pharmaceutical Enterprise and the Betrayal of a History of Care” the book offers insights into drug prices.

The causes for the excessive prices Americans pay for medicine are the subject of this book. The problem of high drug prices is in part a consequence of increasing complexity of both the scientific and business strategies used to develop, distribute, and market new medicines. Moreover, we will observe that the prices also reflect a unique perversion of general capitalistic tendencies. (page 3)

Likewise, an intent to inform consumers of the opportunities for less expensive competitor products gave rise to ceaseless pharmaceutical advertising, creating a situation where many companies now spend more money on television advertisements than for research and development. (page 9)

With the passage of the 1938 Federal Food, Drug, and Cosmetic Act, we again encounter an example of lawmakers looking backward at a past tragedy rather than anticipating future ones…However, the law failed to require that drugs be effective, merely safe. (page 33)

Although the word may sound intimidating, pharmacokinetics is the science of understanding where a drug goes in the body and how quickly it becomes distributed. (page 45)

An insider with information about drug development surprised us by stating their company calculated one to one-and-a-half million dollars are required for each patient enrolled in a clinical trial for cancer. The costs of clinical investigation of an experimental medicine therefore can be breathtaking. (page 48)

Other costs are certainly less defensible. For example, a sales representative might interact with one or more physicians who recommend that a clinical trial be conducted on a different or more specific population of patients (preferably to be conducted by that physician, for a fee of course). (page 58)

As we will soon see, even after a drug leaves the pharmaceutical company and wends its way through an increasing number of waypoints involving pharmacies and payers before it reaches the patient, the financial details surrounding the reimbursement and distribution practices of many pharmacy managers and insurance companies are almost entirely, and purposefully, opaque. Indeed, at times these latter proble3ms and practices of said players can make the pharmaceutical industry look positively transparent in comparison. (pages 72-3)

Muddying the waters further, the mandate of the FDA, as a federal agency, is limited to regulating interstate drug transport. Within a state, the powers of the FDA are more limited. A prominent example is the ongoing situation with medical cannabis. As individual states legalize medical marijuana, the FDA has no jurisdiction as the product will not (legally) cross state lines. (page 80)

Whereas scientists tended to dominate pharmaceutical industry leadership in the 20th century, leadership is increasingly handed off to attorneys, MBAs, accountants, and other fields that might be best described by Munos as process-driven or further away from the creative. (page 86)

As we have already seen, a mere one in ten experimental medicines tested in the clinic (meaning they survived to the human stage of testing) will ultimately succeed to become a marketed product. (page 92)

Munos and others have projected a rather bleak future for many of the largest pharmaceutical companies absent a dramatic reshuffling of their business strategies. Roughly half of the dozen or so pharmaceutical giants are helmed by low-quality leadership; a feature that may have already sealed their fate. (page 95)

Stated another way, if one looks back to the earliest beginnings of the pharmaceutical industry (defined in our studies as the foundation of Merck in 1668), more than 87 percent of these organization were still active and pursuing the investigation of new medicines as of 1965. (page 103)

Moreover, the ongoing opioid and antibiotic-resistance crises are largely a consequence of inappropriate self-prescriptive advocacy from patients (and relatives) demanding remedies, along with, as a June 21, 2020, 60 Minutes episode pointed out, the willingness of certain unethical doctors to rake in extra dollars at the expense of their patients misinformed (or malintent) insistence. (page 110)

Prior to the creation of modern regulation of medicinal advertising, the propaganda utilized to market products were essentially unchecked. A prominent example was the rage to implement chain-smoking of cigarettes as a treatment for asthma. No less a personage than the French novelist Marcel Proust, a lifelong asthmatic, adopted and advocated for this approach. (page 111)

The much-needed modifications to the 1906 Pure Food and Drug Act outlawed false therapeutic claims but left a loophole that the law could only be enforced if the accused had intended to defraud the public. In practical terms, this loophole was a massive tunnel, and false claims continued to abound until these legislative defects were corrected with the passage of the 1938 Federal Food Drug and Cosmetic Act. (page 113)

The denouement of the DRC ban occurred in 1994 with the rise of the new speaker of the house, New Gingrich. The Georgia republican labeled the FDA and its leader, David Kessler, as the “number one job killer” in the nation, citing their heavy hand in regulating pharmaceutical advertising.” Kessler had been an opponent of unregulated advertising, left in 1997, and the agency soon lowered or removed many of the hurdles (and safeguards) frequently cited by Gingrich loyalists. (page 120)

A total of twenty-four FDA-approved medicines would be withdrawn from the market from the period spanning 1997 through 2004. Among the highest profile of these were a variety of popular diet pills (e.g., Fen-Phen, Dexatrim), allery medicines (e.g., Seldane, Hismanal), and painkillers (e.g., Vioxx, Bexrtra). (pages 128-9)

Our increased understanding of cancer biology has taught us that each person’s cancer has to be regarded as a unique disease, each with its own “temperament” and proclivity to change. (page 148)

High-profile incidents and lesser-known information suggest that generics companies may be driving up the costs of medicines at least as much, and perhaps even more, than innovator companies. (page 155)

Starting in the 1950s, the branded industry launched a campaign to enact “anti-substitution laws” (meaning laws created to prevent the substitution of a branded drug by its generic equivalent). By 1970, all fifty states had compli;ed. Only the District of Columbia had held out and this was roundly criticized by the AMA and APhA. (page 156)

New entrants, smelling blood in the water from customer dissatisfaction with the current system, include Amazon, who purchased PillPack in 2019. It thus seems reasonable to expect that the online behemoth will, at a minimum, seek to dominate the sector and drive out the less efficient or unpopular pharmacy benefit managers. (page 331)

One response to this post.

  1. Posted by Rex the Wonder Dog!🐶🐶🐶🐾🐾🐾 on July 24, 2021 at 1:00 pm

    The causes for the excessive prices Americans pay for medicine are the subject of this book. The problem of high drug prices is in part a consequence of increasing complexity of both the scientific and business strategies used to develop, distribute, and market new medicines.
    Bullshit. The cause of high prices is because of Big Pharma collusion with Congress. No different then Wall Street collusion with Congress. They rig the system based on, and with, their “campaign contribution$”. No different than what public unions are doing on the local and state levels.

    Reply

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