The drug profiteers
The Truth About The Drug Companies
By Marcia Angell
Random House, 2005, �8-50 (pbk)
Reviewed by
James Lowe
THIS IS a well written, deeply informative and often
entertaining book. As well as being interesting in itself, it provides
socialists with even more examples of what happens when the primary,
amoral goal of a company is to sustain and increase its profits. Most
importantly, the book confirms once again that society cannot be run for
the benefit of all on capitalist principles.
The author, Marcia Angell, is the former editor of
the New England Journal of Medicine and a respected healthcare reformer.
However, while she identifies the problem beautifully, with no illusions
in the pharmaceutical industry, her proposals for making it act in the
interests of patients fall short of the large dose of democratic
socialist planning the industry needs.
While the book concentrates mainly on the US
pharmaceutical industry, laws and regulatory institutions, the industry
is multinational and the impact of its activities and regulation in the
US is international. The international influence of the Food and Drug
Administration (the FDA, which has to approve a drug in order for a
company to market it) is significant and the continued Americanisation
of the NHS means the lessons delivered in the book are very relevant.
In general, Angell�s research on the pharmaceutical
industry reveals: huge profits ($35.9bn for the top ten drug companies
in the US alone in 2002); dishonesty (such as misleading adverts and
information provided to doctors); fraud and bribery (�consultancy fees�
paid to doctors for attending glorified promotional events); secrecy
(budgets are kept cryptic so the relatively small and large amounts
spent on research and marketing respectively are not apparent); a lack
of innovation (many of the innovative useful drugs that are produced are
developed by universities, charities or small biotechnology companies
and bought by the pharmaceutical companies � most drugs developed by the
pharmaceutical industry are very similar in chemistry, action and
effectiveness to drugs already available). The defences of the drugs
companies and their apologists are torn down with cold hard facts and a
welcome dose of wry humour.
The pharmaceutical companies have one motive for all
of their activities � to increase shareholder value by sustaining and
increasing their profits. Angell identifies the various ways they
achieve this, the main ones being obtaining and extending monopoly
rights, marketing and keeping prices high.
Monopoly rights on drugs are granted either by the
FDA or by a patent. The FDA receives an application by a drug company to
market a drug for a particular use. The application includes information
on the safety of the drug and its effectiveness, gleaned from small
group studies or full-blown clinical trials. Clinical trials are often
coordinated by private companies employed by the drug companies. Bias
can be built into the methods of studies into the usefulness and safety
of drugs and it is in the financial interests of the organisation
carrying out the research to ensure its employer gets the results it
desires.
The FDA, like many regulatory institutions in the US
and Britain, is very poorly funded and led by people that are very close
to the industry it is supposed to be regulating. The US Patent and
Trademark Office awards bonuses linked to the number of patent approvals
given.
Patents are given even more spuriously. With
monopoly rights due to expire on the original Prozac in 2004 a new
patent was taken out for a different use of the same drug. Monopoly
rights are a godsend to drugs companies as they prevent other companies
from manufacturing the same drug and so allow the monopoly company to
charge sky-high prices. They hire teams of lawyers to sue companies
producing generic drugs even if the monopoly rights have expired on that
drug. This legal action immediately gives the drug company another 30
months of monopoly rights. An extra six months monopoly rights are also
given if the drug is tested in children, regardless of whether the drug
will be used on children (such as drugs for heartburn, high blood
pressure and pre-menstrual syndrome).
Marketing is often disguised as �education� in the
corporate world, and drug companies even use medical education to flog
their drugs. Conferences and seminars are run for doctors (either by
drug companies or companies financially linked to drug companies) that
are essentially advertisements. Such events encourage doctors to use
drugs as a first resort and �medicalise� behaviours and physiological
conditions that aren�t really illnesses. Doctors and academics are also
paid to write letters, articles and academic papers extolling the
virtues of a drug � sometimes to treat illnesses for which it has not
been approved. They also receive �consultancy� fees to attend all
expenses paid beanos.
�Education� can also take the form of sales reps
swarming around hospitals and doctors surgeries, offering blarney and
free samples. These are often accompanied by simple surveys containing
skewed questions aimed at giving the doctor or patient that fills them
out a positive view of the drug. Direct advertising is seen by the
industry as less effective than these underhand methods. It is very
effective, though, in selling non-prescription drugs and getting
patients to pester their doctors for drugs that are either ineffective
or are simply not needed. Selective use of statistics and testimonies
are the favoured methods of direct (to the public) drug advertising.
Cheaper drugs from Canada are smeared as unsafe and
US citizens are banned from buying them. That doesn�t stop them or even
state governments from buying the Canadian drugs, which because of the
better regulation in Canada are generally safer than US produced ones.
Socialists are all aware of the reasons why the
pharmaceutical industry acts in this way. We are also aware that the
pharmaceutical industry is not an isolated example of the misrule and
damage capitalism causes. Our aim to nationalise the pharmaceutical
industry and bring it under democratic workers� control is part of a
much wider transformation of society. Unfortunately, Marcia Angell does
not link what she has discovered about the pharmaceutical industry to
the other consequences of capitalism and the pursuit of profit. She sees
the problem as arising from inadequate regulation of capitalism, not
inherent in the capitalist system itself. Her proposed reforms are
thought through and if implemented (a massive if) would do some good for
a while. However, while a rich and powerful profit driven industry
exists it will always try to subvert (or change) laws that restrict its
profits by steering it into more socially responsible ways of operating.
Angell recognises the distortions and corruption caused by the drive for
ever higher profits. She knows regulations put in place to control the
activities of the industry have been dismantled (or are ineffectual if
still in place). She acknowledges the power the pharmaceutical industry
has in shaping US and international laws through fierce lobbying,
funding politicians and organizations, and that international trade
regulations as set by bodies such as the WTO may prevent the
implementation of her proposals. Yet she still thinks that the reforms
she proposes can be put into place with a combination of consumerism and
lobbying politicians.
While this is an excellent book, the subject matter
is not considered in a wider context and Angell never considers that the
solution might be to do away with the whole system that breeds such
distortions and corruption rather than trying to tinker ineffectually.
Removing capitalism would end the distortions that
plague the pharmaceutical industry, a result of the never ending quest
for increased profits regardless of the social or environmental
consequences. A democratic nationalised pharmaceutical industry would
not have thousands of people duplicating tasks or working to produce a
drug very similar to an already existing one. There would be much more
focus on �unprofitable� illnesses that currently do not get a look in,
such as drugs to treat ailments in the Third World. The high costs of
marketing (35% of revenue for US drugs companies, according to the
financial regulator the Securities and Exchange Commission) would be
unnecessary and the deliberate strategy of misleading doctors,
regulators and citizens would be a thing of the past. Free, safe and
effective drugs would be made available to all those that need them.
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