Tuesday, December 9, 2008

Can the pharmaceutical profit motive be subdued?

Are pharmaceutical companies today uncontrolled in their lust for profits--at the expense of drug utility and safety? In our nightly television news broadcasts the frequent pharmaceutical ads must portray, by FDA rule, the side effects of each drug. In many instances the side effects are horrific--but in practically each instance the drug advertised is very expensive and this, not its "therapeutic" effect, is the reason it is being promoted. Do pharmaceutical companies really care about the welfare of patients, or is patient welfare merely the excuse to amass large profits?

A few weeks ago there was an Internet report that one of our largst pharmaceutical companies, Pfizer, Inc.. was "shifting its research focus to diseases that have high potential for high profits," such as in "oncology [cancer], pain and Alzheimers disease." What happens to lesser illnesses that affect major portions of the populations--illnesses that may not perhaps require expensive medications? Do they go by the boards? Suppose a drug company or companies developed a drug that could adequately treat a common illness--but there was no or little profit in it? Would they go ahead with it? Would they place expensive ads on television dramatizing its curative effects? Full-page ads in the medical journals, in consumer-read national magazines? Not according to the pharmaceutical news reports appearing in the media. Not according to the constantly escalating prices of commonly used and expensive drugs--heartburn medications, hormones, anti-arrhythmia medications--which have been on the market for years, some of which force especially older people to choose between paying for these expensive medications and buying food.

Years ago the drug manufacturing profession used to be known as the "ethical pharmaceutical industry," in contradistinction to patented or other preparations hawked to the public by commercial promoters ("Carters Little Liver Pills"). Ethical pharmaceuticals included companies primarily engaged, under federal regulation and supervision of law, in manufacturing and fabricating drugs--in the form of pills, ampules, ointments, powders and suspensions--to the medical, dental and veterinary professions, which have been shown to be medically useful to the public and to veterinary patients. The word "ethical" embraced this industry's image for product honesty and portrayal of sincere helpfulness to humanity as the primary purpose of its business undertakings.


Is there anyone in the drug industry that cares about the public? Is there any CEO, CFO, COO or company chairman or president that knows anything about the drug trade? About drugs per se? Who is not primarily a business person? Who is not primarily concerned--obsessed--with profits? Who does not think the term "ethical" laughable--an appellation that belongs in the last century?

The announcement by Pfizer, Inc., that it will now concentrate on drugs only with a high profit potential--is now industry-wide. Only with few exceptions all pharmaceutical companies are adopting this financial strategy. What effect will it have on you? What effect on the population? On businesses and industry? On our national welfare?

There are two aspects of drug pricing that need to be addressed and--in my estimation-- immediately corrected. Runaway drug 'caps.' And, in many cases, initial--obscene--drug pricing.

As part of current, federal health laws, there are no 'caps'--upper limits--on prescription drug prices. Thus while those enrolled in various health plans may pay only a fraction of retail drug prices for their prescriptions, there is no cap on the drugs' retail pricing. The drug companies are free to charge whatever they want. People, for example, in a drug plan paying only a modest amount for a prescription item, may find their out-of-pocket expense for it double by the next year. And people who are in no prescription plan--or those who have reached the 'doughnut hole' of their plans--might no longer be able to afford the same prescribed drug one year later. From a pricing point of view the pharmaceutical companies are not primarily concerned whether people are in a drug plan, they--the companies--are free to raise the price of their drugs as often and to the exent they see fit.

As to the pricing of new drugs, especially those for treating cancer, the sky's the limit. For example, the drug Erbitux was initially priced at $12,000 per month and was subsequently raised to $18,000 per month (even though studies showed it to be only minimally useful). The drug Avastin was priced at $46,000 to $56,000 per-patient cost; Vectibix, $36,000; Lucentis, $48.000; Revlimid, $67,000; Sutent, $46,000; even single injections of simple colony-stimulating agents, for example those to increase a patient's production of red or white blood cells, $2,000 to $7,000 per injection. Do you mean to say most individuals can afford these obscene and unneeded payments? No, they can't. But the health insurance plans all authorize them. So the payments are spread among the entire membership of these plans, among the businesses and industries that underwrite these plans for their employees and among the federal and state governments.

Thus, in their pricing--and in their unbridled avarice--the pharmaceutical companies are succeeding in bringing down the average individual, in reducing--to unncecessary lengths--
the financial wherewithal of individuals to bring up families and to otherwise enjoy life's many directions.

But obscene pharmaceutical prices are not only bringing down individuals and their families, they are also contributing to the demise and "foreclosure" of business and industry. Many of the country's businesses--large and small--have either collapsed or left these shores because costs in underwriting the health and prescription plans of their employess have constituted the "straw that broke the camel's back.' And, in like manner, ever-increasing health and prescription costs are eroding the national welfare, helping to create a negative impact on the country's gross domestic product and services.

How can we "rescind" the excess profit motive of this industry? How can we restore the "ethical" to pharmaceuticals? How can we damp the greed of our health insurers--whose executives, often controlling the medical decisions of physicians, frequently walk away with millions of dollars they have managed to squeeze from their hapless memberships annually?

There is a way. And that is that this runaway "health machine" must be regarded in the same way as a war. If our nation can contribute billions to an actual war, it can contribute these kind of funds to what is actually an ongoing war--health costs eating up the wherewithal of people and the industrial backbone of this nation. We must bring into being a type of universal health care whereby people no longer have to worry about having sufficient money to cover their families' health and prescription costs, whereby businesses and industry are freed from the constraint of underwriting health costs for their employees in order to stay in business.

And at the same time, we must tame these costs. We must rescind them to levels that are commensurate with reasonable profits. We must regulate them and not allow the genie of greed to run rampant in today's health sector of society.

Health care is one of the most important issues that will confront the new administration. There is every hope that this new administration and its determined president will devote its considerable resources to finding a way of adequately resolving this demanding question.