The Holy Grail of Giant Pharma

CRS:

thanks for this very informative and well researched piece

isn't there an indian angle to this?

remember reading about an indian upstart pharmaceutical company that agreed to supply the generic aids drugs to south african patients for under $100 per year when the big MNCs balked?

dear temporal,
Thank you for your comments.

I think it was Yusuf Hamied of CIPLA who declared that he can supply medicine for HIV to Sub-Saharan Africa, India and the rest of world at affordable prices.

Patents create monopolies and this is disastrous in a country like India where a large section of its people are mired in poverty as it could increase prices by not allowing cheaper drugs from entering the market.Also India is under pressure to amend its patent laws to bring in conformity with WTO and US laws. Critics have pointed out in matters such as health patent laws should be restricted in its application and price control should be imposed in public interest.

The article written by me deals with big pharma corporations abusing patent laws to prevent the entry of cheaper generic drugs.It also exposes the dubious claim of pharma corporations that they spend huge amounts on research when they largely depend on publc research institutions (NIH)paid out of tax-payers money.

The lessons to be learned for India would be to exercise abundant caution while affording monopoly rights to pharma companies.

thank you CRS:

yes that was him

one of the upshot of his inititative was that the big boys here (in canada) were forced to agree to lower their prices (but only for sub sahara victims)

Well if you want more examples of Pharma skullduggery here they are:
evelyn Pringle writes"...Over the past six years, ten FDA approved drugs have been withdrawn from the market due to deaths and injuries, leading lawmakers to accuse the FDA of not doing its job in protecting the public from unsafe drugs and to call for measures of improvement.
while lawmakers search for ways to ensure that Big Pharma does not continue to conceal adverse reactions that surface during drug trials and to sever the ties between the nation's public health officials and Big Pharma, the Bush administration continues to promote their cozy relationships and help drug companies escape accountability for misconduct.
The best example of the administration's efforts to protect Big Pharma was revealed recently when the FDA announced a preemption rule that would disallow lawsuits in state court against drug makers if a drug has been approved by the FDA."We think that if your company complies with the FDA processes, if you bring forward the benefits and risks of your drug, and let your information be judged through a process with highly trained scientists, you should not be second-guessed by state courts that don't have the same scientific knowledge," said FDA deputy commissioner on medical and scientific affairs, Scott Gottlieb.
Typically, as a first step toward the approval process, a drug company will initiate laboratory testing to assess the effectiveness and safety of a drug and if the laboratory testing is successful, the company will begin testing the drug on animals. The FDA does not become involved until the drug maker seeks permission to test the drug on humans.When the drug reaches that point, the FDA's Center for Drug Evaluation and Research, evaluates the results of laboratory and animal testing prior to allowing any study on humans.Once a drug is approved for testing on humans an Institutional Review Board (IRB) is appointed to review and monitor the research. An IRB is generally made up of outside scientists, doctors and other medical professionals and has the authority to approve or disapprove a study or to require modifications to secure approval of the research. The purpose of an IRB is to assure that appropriate steps are taken to protect the rights and welfare of human subjects. To that end, an IRB uses a group process to review research protocols and materials such as informed consent documents and investigator brochures related to the research.
In recent years, serious questions have been raised regarding the impartiality of the review process due to the fact that many of the FDA advisors recommending approval of a product are at the same time employed by the drug company that developed the drug or hold some other financial interest link to the company. Due to these conflicts of interests, critics say dangerous drugs are winning approval. For instance, nearly a third of the members of the advisory panel that reviewed the data on Vioxx, Celebrex and Bextra, and voted to allow the drugs to remain on the market, even after Vioxx had been pulled off the market, had financial ties to the makers of the drugs and had their votes not been counted, they would never have received a vote of approval.
In addition, problems continue to surface in the private research industry. Contract Research Organizations (CRO), are now hired by the industry to perform research.Critics says the competing CROs are skewing research in favor of approval in order to win more contracts. The funding up for grabs is enormous. According to a March 24, 2006, MSNBC commentary by Arthur Caplan, director of the Center for Bioethics at the University of Pennsylvania, "Private companies running studies for pharmaceutical and device companies are now a $14 billion industry in the United States alone."According to John Abramson, a clinical instructor at Harvard Medical School, and author of, "Overdosed America", "When the institutional review boards were created, most medical research was conducted by universities and nonprofit institutions."…"Similarly," Mr Abramson says, "oversight of the safety of human volunteers in most U.S. studies is no longer done by nonprofit IRBs, but by for-profit review companies, hired directly by the for-profit research companies."In his opinion, he says the system lacks the appropriate checks and balances to protect human volunteers.
In the April 6, 2006 LA Times, Mr Abramson made a shocking revelation when he said, "the FDA recently approved "phase 0 studies" in which human beings can be given minuscule doses of experimental drugs even before animal studies are completed."…..Highly questionable research recruitment techniques are also occurring in the US. On November 29, 2005, in Texas, CBS News channel 42 reporter, Nanci Wilson, revealed records showing that staff at state mental hospitals in Texas help recruit patients into studies of experimental drugs not approved by the FDA.At a state hospital in San Antonio, CBS News found 16 beds set aside to allow drug companies to conduct studies on mental patients under the state's care. CBS 42 asked Austin psychiatrist, Deborah Peel, to review some of the records they obtained. Dr Peel said the situation raised serious questions as to whether this is moral and ethical treatment. "They are essentially turning the state hospital population into research subjects," she noted.Texas hospital officials claim the mentally ill patients give informed consent by signing a detailed form describing the risks and benefits of participating in the study. But Dr Peel says, "I think there are real questions how informed their consent would be under those situations, because these are not people who have the means to choose to go elsewhere for treatment, and so, there's a powerful element of pressure, of coercion that they have to feel.""Once again," Dr Peel points out, "we have people who have no means, who are dependent on the state system, and the state system is working hand-in-glove with private corporations."In many studies, CBS news investigators determined that patients had been taken off drugs that were working and in the new study, some patients were given the experimental drug while others received a placebo. Critics point out that for patients taking a new drug, there is no guarantee it will work, and the risks and long-term effects are not known. "To take people off medication when they have just been admitted for an inability to function and might have even been a harm to themselves or others, that raises real questions for me," Dr Peel told CBC News.What's worse, she says, is that patients are not told whether they are taking a placebo or a drug even when they are discharged from the hospital during the study. They could get suicidal, she said, or could harm others.
The FDA has ignored atrocities in research involving mentally ill subjects for years. Back in 1998, a review of the data on atypical antipsychotic drugs submitted to the FDA, obtained with FOIA requests by Robert Whitaker, revealed numerous safety problems for subjects who participated in the trials.Mr Whitaker found that among 12,176 patients from the US and abroad at the time the data was submitted, there were 88 deaths, including 38 suicides, meaning there was an overall death rate of 1 out of every 138 patients, according to his article in the November 17, 1998 Boston Globe. The suicide rate in trials was found to be 2 to five times higher than the norm. In the medical literature, Mr Whitaker reported, suicide rates for schizophrenics ranged from two to five deaths per 1,000 per year, while the rate in trials was close to 10 per 1,000. In addition, he found that for the three approved drugs in the study - Zyprexa, Risperdal, and Seroquel - 60% of the 7,269 patients who received the drugs dropped out before the end of the study, which typically lasted six to 8 weeks.
In the 1990s the prospect of antipsychotic drugs gaining FDA approval, promised a major market for Big Pharma and therefore, drug companies needed to recruit trial subjects quickly. And drug companies were willing to pay top dollars to researchers for each patient recruited.
Dr Bruce Levine, PhD, Clinical Psychologist and author of, World Gone Crazy, tells a story about Eli Lilly corrupting the judicial process in a case that began in 1989 when Joseph Wesbecker opened fire at his former place of employment, killing 8 people and wounding 12 more, before committing suicide, a month after he began taking Prozac. The victims of the shooting sued Eli Lilly, claiming that Prozac had pushed the guy over the edge.It has long been known that Prozac induces violence in some patients but the FDA never required Lilly to list violence on the drug's label. But as it turns out, five of the 9 members on the 1991 FDA advisory panel investigating the association between Prozac and violence that voted against requiring a warning label for violence, had ties to Big Pharma and two of the members had served as lead investigators for Lilly-funded Prozac studies.The Wesbecker trial did not take place until 1994, but in the meantime, according to Dr Lavine, "Eli Lilly had been settling many Prozac violence cases behind closed doors."In fact, he says, more than 150 Prozac lawsuits had been filed by the end of 1994, so "it was looking for a showcase trial that it could win."A crucial component of the victims' legal strategy in the Wesbecker case was for the jury to hear about Lilly's history of reckless disregard toward consumers, especially about the drug Oraflex, introduced in 1982 but taken off the market 3 months later. "A US Justice Department investigation linked Oraflex to the deaths of more than 100 patients," Dr Lavine notes, "and concluded that Lilly had misled the FDA."In the end, Lilly was charged with 25 counts related to mislabeling side effects and pled guilty.At the Wesbecker trial, Lilly attorneys argued that the Oraflex information would be too prejudicial for the jury to hear and the Judge initially agreed. However, when Lilly attorneys used witnesses to testify about it's superb system of collecting and analyzing side effects, the Judge said that Lilly had opened the door to evidence to the contrary and so the Oraflex information would also be allowed in. However, to Judge's amazement," Dr Lavine says, "victims' attorneys never presented the Oraflex evidence and Eli Lilly won the case. "It was later learned that Lilly was successful in corrupting the judicial process in the case by cutting a secret deal with victims' attorneys to pay them and their clients not to introduce the damaging Oraflex evidence. However, Dr Lavine says, the Judge "smelled a rat" and fought for an investigation, and in 1997, Lilly quietly agreed to the verdict being changed from a victory to "dismissed as settled." ......."

Matt Vidal writes....."An example of the perverse effects of the drive for exchange-value in the pharmaceutical industry is that these companies typically do not invest much in finding vaccines or cures, but instead focus on treatments for diseases where there are large existing or potential markets and, ideally, for incurable chronic diseases so that consumers must take drugs for life. Pharmaceutical companies sell drugs to make money, not to help people. Witness their intense lobbying to keep cheap imports out of the hands of the US market and cheap generics out of Africa.
According to Alex Hittle, an analyst for AG Edwards, "We sometimes joke that when you're doing a clinical trial, there are two possible disasters. The first disaster is if you kill people. The second disaster is if you cure them. The truly good drugs are the ones you can use chronically for a long, long time."[4]
Where pharmaceutical companies do focus on cures, it is often for invented diseases of rich Westerners, such as pre-hypertension, compulsive shopping and gambling addiction, while crippling diseases such as malaria, tuberculosis and sleeping sickness remain unprofitable and hence with few or no effective treatments or research dedicated to finding cures.[5]
Sleeping sickness, for example, which is at epidemic levels in Africa, only has two treatments its late stage. One, melarsoprol, which corrodes human veins and must be delivered in glass syringes, fails for a third of patients and kills one in ten. The more effective treatment is eflornithine, which was discontinued as a treatment for sleeping sickness by Aventis because it was unprofitable. Yet the company continued to manufacture it as an ingredient in Vaniqa, a cosmetic drug that removes facial hair. Only after the independent medical aid agency Médecins Sans Frontières threatened to sue was a deal worked out to continue producing eflornithine as a treatment for sleeping sickness.[6]
More generally, Big Pharma spends more money on marketing, suppressing competition, and shaping laws, trade agreements, the regulatory regime and the scientific review process than it does researching and developing drugs. Pfizer, for instance, spent over $11 billion on marketing in 2001, over twice what it spent on R&D.[8]
According to PhRMA, 39% of industry staff are in marketing while only 22% are in research and development; since 1995 the marketing staff has increased by 59% while the R&D staff has decreased by two percent.[9]
A primary goal of pharmaceutical industry marketing, and management more generally, is to find so-called blockbusters that have potential sales of over a billion dollars. Profit in the pharmaceutical industry often comes not from innovative products but from innovative marketing in ways that are often pure waste from the point of view of consumers.
Much of the investment of pharmaceutical companies in research goes not toward finding new drugs for diseases without cures that is, generating new and sorely-needed use-values but into producing "copycat" drugs: slightly different versions of existing blockbuster drugs that are functionally similar but different enough to bypass an existing patent. Indeed, a study by the National Institute for Health Care Management found in 2002 that two-thirds of the new drugs approved by the FDA between 1989 and 2000 were identical to drugs already on the market or modified versions of existing drugs, with only about 15% judged to be significant improvements over existing medicines.[10]
What is covert but routine in the US is explicit in countries without regulations: Western pharmaceutical companies commonly exchange refrigerators, TVs and money for prescriptions in countries like India and Turkey.[11]
Financial industry ties to the scientific establishment are so prevalent that in 2002 the New England Journal of Medicine eliminated their policy barring those with financial ties to companies whose medicines are being studied from authoring reviews of medical studies.[12] Enough independent experts could no longer be found to write the reviews.
The contemptible extent of Big Pharma's influence in the scientific process is summarized neatly by Drummond Rennie, a deputy editor of the Journal of the American Medical Association:
I'm the advertising guy for the drug. I tell a journal I will give them $100,000 to have a special issue on that drug. Plus I'll give the journal so much per reprint and I'll order a lot of reprints. I'll select the editor and all the authors. I phone everyone who has written good things about that drug. I say, "I'll fly you and your wife first class to New Orleans for a symposium. I'll put your paper in the special issue of the journal and you'll have an extra publication for your CV." Then I'll put a reprint of that symposium on some doctor's desk and say, "Look at this marvellous drug."[13]
Big Pharma employs a lot of rhetoric about innovation and the provision of new medicines and useful products for consumers. But these companies are ordinary capitalists trying their best to capture the market and make profit; they are extraordinary only in their success, in large part due to the monopoly patent protection they enjoy. And they chose profit over the public good or need as a rule......"

And finally in case you are wondering after all that so called researching,funding,patentingblah blah blah if the drugs are really any good just read Dr.Peter Rost's comments...."On Thursday, November 30, Pfizer's executives conducted a well rehearsed dog-and-pony show over at Pfizer's research facilities in Groton, CT. All interest was focused on torcetrapib; the most important new drug in Pfizer's pipeline, which boosts good cholesterol.
According to Forbes, Pfizer Chief Executive Jeffrey Kindler told about 250 analysts and investors attending the meeting that torcetrapib was "one of the most important developments in our generation."
Pfizer research president John LaMattina said, "We believe this is the most important new development in cardiovascular medicine in years," according to the Wall Street Journal.
On Saturday, December 2-two days later-Pfizer said in a statement that it is terminating all clinical tests of torcetrapib and its plans to bring the drug to market. A board of independent experts had reviewed the latest data from a 15,000-patient test on torcetrapib and found that patients on the drug were dying like flies; almost twice as many dead as on the comparator. The company also said it is asking doctors participating in studies of torcetrapib to tell patients to stop taking the drug immediately.
Associated Press concluded, "The news is devastating to Pfizer, which had been counting on the drug to revitalize stagnant sales that have been hurt by numerous patent expirations on key products. It has said it was spending around $800 million to develop torcetrapib."
Of course, in the drug industry, bad stuff happens. But in this particular case, the whole scientific world had been worried about the fact that torcetrapib raises blood pressure. Not a good thing for a cardiovascular drug. But that didn't stop the Pfizer executives from hyping torcetrapib. Until it turned out that "one of the most important developments in our generation" was really a killer drug-quite literally.

This was the drug that was going to save Pfizer when Lipitor, Pfizer's $14 billion blockbuster anti-cholesterol medicine, goes off patent in 2010. To make matters worse, two days before canceling all further development, Pfizer's CEO Jeff Kindler stated at a large meeting with 250 analysts that torcetrapib was "one of the most important developments in our generation."
During the past week newspapers and analysts and scientists have had one question on their mind: How could something like that happen to the preeminent drug company in the world? How could the CEO of this powerful drug company be caught hyping a drug that was withdrawn only days later?....."

Still wanna pop that pill folks?

This is definitely many discussions surrounding how pharmaceutical companies are reaping profits off treatments.

Here's the point of view from a patient on why he thinks it's important for these companies to find treatments for rare diseases and still make money:

http://www.fightpompe.com/site_index/155/thoughts-on-cashing-in-on-orphan-drugs

Good article Sridar. However, many crib at the profits made by pharma companies, but no one thinks about the conttibutions of pharma companies.

Starting from Vaccines for rabies (of course it was not developed by any pharma company) INH and Ethambutol to fight tuberculosis, H2 receptor antagonists which has saved vagatomy, the list is endless.

Exclusive marketing rights for an invention is an incentive for many to invent new drugs. Of course these incentives are utilised by many to maximize profits.

Cipla can boast that they can supply cheaper versions of drugs to African countries, but can the MD of Cipla boast of any research drug to his credit. The same Cipla had shamelessly trumpeted in copying many original inventions, using the provisions of process patenting in India, branding someone else's invention as theirs.

Many companies in India still continue to do that, but no one has an original invention to their credit. The list is very big, Ranbaxy, Cadila, Sun, Dr.Reddy, Cipla, etc.

only in India we can find too many branded drugs of the same chemical and the orginal research drug losing the race due to cheap imitations.

The flip side is, multiple brand names have improved the memory power of the counter sales persons in drug stores, and they never had a neccessity to consume the pills they sold which apparently improves the memory power.