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June 13, 2002
Stanton / Madsen
Democracy
in Crisis:
What is to be Done?
Roldan Tomasz Suárez
Venezuela:
Five Facts
About the Coup
June 12, 2002
Fran Shor
Dirty Bombs, Blowback
and Imperial Projections
Dave Marsh
Shelley
Stewart, Radio and the Birmingham Civil Rights Movement
Chris Floyd
Murder, Inc.
June 11, 2002
Omar Barghouti
On Dance, Identity and War
Robert Fisk
The Bush
Afghan Gang:
Murderers, Gangsters, Stooges
Minerva Wright
The Donkeys of the Holy Land
David Krieger
Stopping
a Nuclear War
in South Asia
June 10, 2002
Jeffrey St. Clair
Executioner's Last Songs
June 8/9, 2002
Gavin Keeney
Mademoiselle
M.
Or Getting Screwed in Paris
Susan Davis
Sleepless
in the Suburbs
Curing Insomnia: a new use for The Nation?
George Sunderland
"Send
in the Weekly
Standard": The Screaming Pundits Assault Corps
June 7, 2002
Michael Colby
Bush to the Nation:
You're All Cops Now
Tanweer Akram
Howard
Zinn's "Terrorism
and War": a review
David Krieger
New Security Challenges
Sam Bahour
The Palestinian
Intifada:
A Very American Struggle
Tom Turnipseed
A Crisis of Confidence
in US Leadership
June 6, 2002
Michael Colby
White House
vs. EPA:
Political Hot Air and
Global Warming
Ron Jacobs
The Indo-Pakistan Conflict:
It's Just a Shot Away
Francis Boyle
Take Sharon
to The Hague:
Prosecute Israeli War Crimes
at Jenin
CounterPunch Bulletin
60 Minutes and President Chavez's
Censored F-Word
Mark Weisbrot
Spying
and Lying:
The FBI's Shameful Past
June 5, 2002
Robert Fisk
Berlusconi the Censor
Danielle Brian
Nuclear
Plants and Terrorism
Ardeshir Cowasjee
For What Do We Fight?
George Monbiot
Kashmir
on the Brink
Michael Neumann
What is Antisemitism?
June 4, 2002
Dave Marsh
Bono the Useful Idiot
William Evan / Francis
Boyle
Kashmir:
Invoking Intl. Law to Avoid Nuclear War
Cockburn / St. Clair
The Future Wellstone Deserves
June 3, 2002
Ramdas / Makhijani
India,
Pakistan and Nukes:
A Road Map to Peace
Fran Shor
Meanwhile, Back in Afghanistan
Neve Gordon
The Caterpillar
Effect
June 2, 2002
Fidel Castro
From FDR to Mister "W.":
Cuba, the US and Democracy
Arundhati Roy
Under the
Nuclear Shadow
Bernard Weiner
Bush 9/11 Scandal for Dummies
June 1, 2002
Norman Madarasz
The
Strange Math of Roberto Carlos: Brazil v. Turkey
Gavin Keeney
Bush and Mies van der Rohe:
Architecture and Ideology
Jeff Halper
Sharon's
Post-Incursion Plan:
Incarceration or Transfer?
Walt Brasch
Crumpling the Constitution
Resources:
100s of Links
About 9/11
CounterPunch:
Complete
Coverage of 9/11 and Its Aftermath
Five
Days That
Shook The World:
Seattle and Beyond
By Alexander
Cockburn
and Jeffrey St. Clair
Photos by Allan Sekula
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and Osama bin Laden
Whiteout:
CIA, Drugs & the
Press
by Alexander
Cockburn
and Jeffrey St. Clair
The Memphis Blues Again:
Six Decades of Memphis Music Photographs
Photos by Ernest Withers
Text by Daniel Wolff
The New Intifada:
Resisting Israel's Apartheid
Edited by Roane Carey
A Pocket Guide to
Environmental Bad Guys
by James Ridgeway
and Jeffrey St. Clair
The
Phoenix Program
by Douglas Valentine
Al Gore:
A User's Manual
by Cockburn
and St. Clair
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Reviews of Gore:
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June 13,
2002
Sometimes
Even Big Pharma Must
Have to Stand Naked
Time to Put Lives Above Patents
by Russell Mokhiber
and Robert Weissman
Drug prices in the United States are out of control,
and rising.
The reason is that the United States
permits pharmaceuticals to be marketed by unregulated monopolies:
Patent protection gives the drug companies monopoly control over
their products. These companies face neither direct competition,
nor price controls.
But what is the reason for the government
grant of these patent monopolies (which often extend long beyond
the official 20 years, thanks to a variety of Big Pharma  "evergreening" tactics
to block or delay the introduction of generic competition)?
Leaving aside the raw political power
of the pharmaceutical industry and its allies, the policy rationale
for patent monopolies is the cost of drug development. According
to the drug companies, the cost of researching and developing
a new drug is $800 million.
The myth of astronomical drug development
costs is the figleaf behind which Big Pharma and its paid associates
(inside and outside of government) hide to escape criticism for
price gouging. If this myth were peeled away, Big Pharma would
stand exposed. And the prospect of a more rational system of
drug development and pricing would rise dramatically.
This matter could be resolved, simply,
if the drug companies were to open their books and reveal their
actual investments in R&D. Instead, they implausibly claim
that this information would give away trade secrets and must
remain proprietary.
The industry claim of $800 million costs
per drug relies on a study from an industry-funded research center
at Tufts University in Boston. Tufts researchers supposedly had
access to industry data to come up with their figure, but no
one else is able to see the underlying data. So if you choose
to believe in this number, it is simply a matter of faith.
To get closer to the actual figures for
the cost of drug development and company per drug expenditures
on R&D, you have to peel away the assumptions and built-in
biases of the Tufts-industry study.
Approximately half of the Tufts-industry
estimates are attributed to financing costs, known as opportunity
cost of capital. Money invested in drug R&D could have been
invested in treasury bonds, say. While the bonds would start
returning revenues right away, R&D returns are not realized
for years, until a drug is discovered, developed, approved and
put on the market. So in the Tufts-industry study, a "cost"
of development is the forsworn income during the period of development.
This is all true, as far it goes, but
it is not how people normally think about "cost." As
James Love of the Consumer Project on Technology says, it is
the equivalent of saying the cost of a car is not the sticker
price, but the sticker price plus interest payments on a car
loan.
Exacerbating the problem, the researchers
may pick an unreasonably high interest rate. They may also set
the period for drug development as too long -- in the Tufts-industry
model, relatively small delays in getting the drug to market
lead to big increases in the overall cost.
The Tufts-industry estimate is for the
cost of new chemical entities for which the industry was wholly
responsible -- that is, where there was no substantial public
contribution to R&D.
It turns out, however, that the vast
majority of new drugs Big Pharma brings to market do not involve
new chemical compounds. A May 2002 study by the National Institute
for Health Care Management (NIHCM) Foundation found that two-thirds
of the prescription drugs approved by the FDA between 1989 and
2000 were modified versions of existing medicines or identical
to drugs already on the market (and only about 15 percent were
both new and deemed by the FDA to provide significant improvement
over existing medicines). Pharma denies it, but there is every
reason to believe these less novel products are far cheaper to
bring to market.
Then there's the not insignificant fact
that the case of drugs brought to market without government support
is the exception, not the norm. The federal government supports
an enormous amount of research, and funds the earliest and riskiest
portions of the R&D process: basic research and the earlier
phases of clinical trials.
Finally, the Tufts-industry figures seem
to wildly inflate the cost of clinical testing. Looking at company
filings with the IRS for tax credits on research for "orphan
drugs" (drugs which treat small populations), however, the
Consumer Project on Technology found that -- adjusted for risk
-- drug companies report expenditures of only $7.9 million on
clinical trials, less than 1 percent of the overall estimate.
Even if the costs for this category of
drug are below average, as the industry claims -- even if they
were, implausibly, a tenth of the average -- this would still
suggest a much lower total development cost than the Tufts-industry
estimate.
Any honest examination of available evidence
on the costs of drug development suggests the United States --
and most of the rest of the world, which thanks to the <U.S./industry>
strong-arming tactics in international trade negotiations, now
maintains or soon will adopt <U.S.-style> patent rules
-- is massively overcompensating Big Pharma for its work in bringing
drugs to market.
With the U.S. healthcare system bursting
at the seams, seniors draining their bank accounts to buy drugs,
and millions of people around the world going without medicines,
the time has come for fundamental reform.
Meaningful reform might include ending
the industry's patent extension tricks, licensing drugs developed
with public monies on a nonexclusive basis to permit price-reducing
competition (or at least permitting competition where prices
are excessive), and considering rollbacks to the 20-year patent
term and the adoption of price controls.
But even these measures may inadequate.
Why couldn't the government simply take over the job of drug
development, and then let private companies manufacture and distribute
medicines in a competitive environment -- doing away with patent
monopolies on drugs altogether?
Russell Mokhiber
is editor of the Washington, D.C.-based Corporate Crime Reporter.
Robert Weissman is editor of the Washington, D.C.-based
Multinational
Monitor, and co-director of Essential Action. They are
co-authors of Corporate
Predators: The Hunt for MegaProfits and the Attack on Democracy
(Monroe, Maine: Common Courage Press, 1999.
(c) Russell Mokhiber and Robert Weissman
Today's
Features
Stanton / Madsen
Democracy
in Crisis:
What is to be Done?
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