Poignant, sensible and sad post on pricing for cancer drugs, courtesy of Derek Lowe.
Poignant, sensible and sad post on pricing for cancer drugs, courtesy of Derek Lowe.
I’m having a hard time splitting my thoughts between the events in Louisiana & Mississippi and the day-to-day stuff I need to get done, so I’m going to write a little more about the latter. I hope you don’t take it to mean that I’m glossing over what’s going on down there. If anything, I’m feeling this constant drain as I try to grasp the concept of a city that’s dying at high speed, while I’m racked with worry about the health and security of my future in-laws.
All of which is a preface to saying that I had a nice professional moment this morning. When I got the office, I received an e-mail from a guy at the European Commission in Brussels, asking if it’s okay to cite my Top Pharma/Biopharma Companies report in his new paper on Biotech and Applied Genomics R&D in Europe.
He sent an early copy of the study/proposal, which was mainly about how the EU has lagged in Biotech R&D. It had some neat suggestions for what they need to do to regain a competitive position vis-a-vis the U.S. and Asia (mainly the U.S.), but I was just gratified that all the work I did earlier this summer proved valuable enough for a government agency to base some of its findings.
In that same vein, a friend of mine called last night to see how I’m doing and what I’m up to in September. “Well, I said, I’ve gotta write the second part of my Biomarkers article, interview some people about Pharma/Biopharma facility design, get a lot of materials ready for our annual conference, and edit a bunch of contributed articles for the mag. At night I’ll be working my way through a re-read of Don Quixote, before my trip to Madrid in November.”
She thought I was complaining.
[Here’s the From the Editor page for the latest issue of my magazine]
By now, the story of the first Vioxx lawsuit is old news. Merck was found liable in the death of Robert Ernst and the Texas jury awarded more than $250 million to his widow. State laws will knock that down to $26 million, and it may get reduced further on appeal. The penalty is harsh and, if it turns out to be the average payout for each trial, Merck will obviously go under. The company says it still plans to fight each lawsuit individually and not enter a class-action settlement, but has admitted that it may settle some cases rather than go to trial. For more on their legal/financial strategy, check out this Slate article.
The size of the award was troubling, of course, but once a case goes to trial, no one really knows what to expect. What was more troubling was a comment from one of the jurors in the case. From The Wall Street Journal‘s story the Monday after the verdict, we learned the following:
Jurors who voted against Merck said much of the science sailed right over their heads. “Whenever Merck was up there, it was like wah, wah, wah,” said juror John Ostrom, imitating the sounds Charlie Brown’s teacher makes in the television cartoon. “We didn’t know what the heck they were talking about.”
Yup: In a trial about the impact of Vioxx on Mr. Ernst’s health, the jurors had no idea what the science was about, and essentially ignored that part of the trial. This left them with the folksy popularism of plaintiff’s lawyer Mark W. Lanier, whose post-trial comments showed how he painted the case: “I love when a widow from a small town can stand up against one of the largest companies in the entire world, actually get access to their documents and show a jury how they killed her husband.”
Yup: “How they killed her husband.” I’m not sure if this is a step up or down from John Le Carre’s recent novel (and now a Major Motion Picture!) The Constant Gardener, in which ‘Big Pharma’ leaves the protagonist’s wife dead (and raped) in Africa, because of trials for a lucrative tuberculosis drug. WeÃ¯Â¿Â½re facing a serious PR problem in this business, and it’s not solely about the average American’s aversion to science.* Maybe people have seen Erin Brockovich enough to decide that all big business is evil, but when that big business is developing pharmaceuticals, we’re in serious trouble.
According to the WSJ article, Mr. Lanier assembled a “shadow jury” to follow each day’s proceedings. Each night, the shadow jury met with a consultant (they weren’t told which side they were consulting for) at the local McDonald’s, where they provided their feedback on the case.
Yup: While they were discussing whether it was Vioxx or clogged arteries that caused Mr. Ernst’s fatal heart attack, they were eating McDonald’s on a nightly basis. And they came out 9-4 against Merck.
* About that “average American”: I’ve always contended that, as Americans, we only have two civic duties (as opposed to our existential duties of death and taxes): voting, and jury duty. But plenty of people find their way out of jury duty, ethically or not. This means that Merck was fighting the opening round of the battle for its life with a jury filled with people who couldn’t get out of jury duty.
Hey, gentlereader! Sorry to be absent for a while (except for those little goofy posts). I’ve been in a little bit of a writing-malaise lately, taking a mini-summer break.
I’ve also been exercising for the first time in forever. The upside is that I’m feeling a bazillion times better, even though all I’m doing is a half-hour on the treadmill. The downside is that I sweat worse than Patrick Ewing by the time I’m done. After that, I’m really not in a writing mood.
It’s only been about 3 weeks of exercise, but that’s an achievement for me, since I have zero willpower. I don’t run down physically, but it’s really tough to motivate myself to keep going. So nowadays I either pivot the gigantor-vision TV around so I can watch a baseball game while I’m treading, or I put an issue of the City Journal up on the display, so’s I can read while I’m on. Most magazines have too small a point size for me to read on the treadmill; I’m really hoping The Economist comes out with a large-print edition for myopic, out-of-shape mo’fo’s like myself.
Anyway, this post is more in the update mode than one with a particular theme. This week’s book is A Canticle For Leibowitz, after I got bored silly by Botton’s How Proust Can Change Your Life. I hoped for more out of that book, but through the first 85 pages it really focused far more on the biography of Proust than on the literary writing of Proust. Those are two really different things, and I’m not sure what Botton was thinking in focusing on that stuff. I’ll read the rest of it some evening, just to see if it gets better.
I’ve also been answering people’s questions about the Merck/Vioxx case. I mean, I’ve been trying to get them to understand the questions they’re asking, because the world’s a lot more complicated than “Did Merck lie?”
So today’s big lesson was that there’s a drug with more bizarre problems with Vioxx. A journalist called me earlier today to ask about some drug companies. Then he mentioned Mirapex, and wanted to know if I had anything to see about “the lawsuits.”
I’d never heard of the drug, so I googled it whle we were talking. This is what I found. Yup! There’s a Parkinson’s drug that may leave users with “powerful urges to gamble, shop, have sex and eat compulsively.”
Or, as I like to say, “It’s not a bug; it’s a feature!”
I’m writing an article about biomarkers and their use in drug development. While doing some research, I came across this article from the editor of the British Journal of Clinical Pharmacology. It opens:
When David Beckham leaves the field towards the end of a match, the man who replaces him is a surrogate. Although I suspect that many footballers, if asked, would say that Surrogate is a town in Yorkshire, the word actually comes from the Latin word subrogare, to substitute.
When I write my annual Top 20 Pharma Companies & Top 10 Biopharma Companies report (this year’s edition is soon to post at the website of my day job), I read a lot of annual reports, along with industry analysis, news coverage, and other neat sources.
The annual reports have two parts: the glossy front half, hyping the company to the general public, and the fine-print back half, breaking down a lot of the numbers and providing SEC-mandated information (litigation issues, executive compensation, accounting policies, etc.). It took a couple of years before I started to understand a little of the subtext in the reports.
I’m still no expert with this stuff (or I’d be making a lot more money), but I do find it pretty fascinating. For example, virtually every company I profiled this year included a variation on the following:
On October 22, 2004, President Bush signed into law the American Jobs Creation Act of 2004 (AJCA), which creates a temporary incentive for U.S. corporations to repatriate undistributed income earned abroad by providing an 85% dividends received deduction for certain dividends from controlled foreign corporations. Although the deduction is subject to a number of limitations and uncertainty remains as to how to interpret certain provisions of the AJCA, we believe we have the information necessary to make an informed decision on the impact of the AJCA on our repatriation plans. Based on that decision, we plan to repatriate [bazillions of dollars] . . .
The upshot of the AJCA was that foreign revenues, which were previously taxed at 38%, were now to be taxed at 5.25% for a single year, if repatriated for the purpose of “creating jobs”. Turns out that a lot of companies have been stowing away a lot of money in foreign revenues, rather than bringing it back to the U.S., where it would have been taxed to bejeesus. Pfizer has decided to bring nearly $37 billion in foreign money into the U.S. under the AJCA. I thought the numbers were pretty astounding, but I had no idea (and no time to research) how much money other major companies were repatriating.
According to this article from BusinessWeek, it turns out my industry is way out in front. In comparison with Pfizer’s enormous stash, Dell’s bringing back just $4.1 billion. Problem is, there’s no way to show that the money’s being used to create jobs. After all, if Pfizer’s R&D budget is $8 billion for 2005, according to the AJCA, they could use the repatriated money for that same R&D budget, and spend the originally budgeted money on buying solid gold rocket cars for all the top executives.
It’s a pretty ineptly named bill since, erversely enough, a bunch of companies benefiting from the American Jobs Creation Act (like Pfizer and Merck) are in the process of dismantling some of their operations and laying off a bunch of employees. Read more about it.
[Here’s the From the Editor page for the latest issue of my magazine]
In America, the July 4th holiday involves an entertaining combination of patriotic fervor and minor explosives. As a nation, we celebrate the declaration of our independence from the one country that we now call our closest ally (supposedly, the British also celebrate July 4th, but they call it “thanksgiving”).
In Brazil, the July 4th weekend evidently involves a game of brinksmanship (not surprising, in a country legendary for knife-fighting). The country’s health ministry gave Abbott Laboratories a July 6th deadline to drop the cost of its HIV/AIDS drug Kaletra, threatening to declare a “public health crisis” and employ a World Trade Organization process to break Abbott’s patent on the drug.
This would lead, at a minimum, to a generic version of the drug in Brazil, in which 600,000 people are infected with HIV/AIDS. That’s a pretty significant impact, but the Associated Press report on this subject actually goes a step further:
Poor countries without drug industries could take steps to authorize imports from Brazil, experts said. And developing countries with robust generic drug production capacity like India and China could be tempted to follow Brazil’s example, creating a bigger threat to the global reach of multinational pharmaceutical companies.
Now, maybe I’m being paranoid (could have something to do with all those explosives that went off this weekend), but “global reach of multinationals” sounds to me like the Pharma biz is being characterized as the Evil Empire (again), and that voiding patents is a viable way to “stick it to the Man” (note that “the Man” in this case is providing Brazil with the lowest price on Kaletra outside of Africa).
India and China have spent years trying to get up to snuff on intellectual property rights, so we wouldn’t possibly imagine that a news organ like AP would champion their reversion to IP theft. On the other hand, maybe I’m just overreacting:
“The impact of breaking the patent would be enormous,” said Michael Bailey, a senior policy adviser for Oxfam International. “If a major country such as Brazil goes through with this, not only will it help ensure sustainability of their excellent treatment program, it will set a hugely important precedent for other countries.”
Nope! It’s pretty clear that this rep from Oxfam believes (along with an HIV-infected Sao Paolo university professor, and a spokesman for Doctors Without
Brains Borders, both quoted in the article) that Brazil’s best path is to void the patent for Kaletra, and then sell the generic form to other countries!
The “hugely important precedent” it would set? That would be “don’t bother researching drugs in this field; we’re just going to get your patents voided.” Then we can see how well Brazil “ensures sustainability” of its treatment program when no new treatments are developed. Last I checked, viruses don’t stand still.
(I want to be fair here, and point out that the article quotes Brazil’s health minister as saying that the country has no plans to export the drug. I also point out that the article fails to quote a single Pharma company spokesman, and the only industry statement is a threat from the International Federation of Pharmaceutical Manufacturers and Associations to withdraw investment and jobs from Brazil.)
I’m off to the BIO conference down in Phila., PA. We likely won’t have as many protesters as last year’s BIO, which was in San Fran; you’d figure anyone dressing up as a giant monarch butterfly is likely to get his ass handed to him on these streets . . .
(For those of you who are wondering about those Pharma/Biopharma profiles I’m working on, it’s kinda depressing so far. A lot of companies are facing a ton of problems, starting with the #1 guys. Here’s last year’s online version, which oughtta keep you entertained while I’m away.)
Working at home today, writing up profiles of the top 20 pharma and top 10 biopharma companies, for our annual Top Companies issue. It’s a ton of research and writing, so I figured, “
Why wear pants? Why not cocoon myself here at home and get writin’?”
Depending on your level of curiosity, it can be a pretty entertaining project. Especially when you have to write about Merck.
In my secret identity, I’m the mild-mannered (okay, angry and abrasive) editor of a pharmaceutical business magazine. The big news in the biz this week was that the FDA “recommended” that Pfizer stop selling Bextra, a Cox-2 inhibiting anti-inflammatory in the same class of drugs as Vioxx and Celebrex. The move sucks for Pfizer, which bought Pharmacia for $60 billion a few years ago with the plan to use Celebrex and Bextra to build a Cox-2 powerhouse. Now it’s stuck with a bloated infrastructure, tons of redundant employees, and a business model that’s still predicated on the crapshoot of Pharma R&D.
But why is the FDA calling for Bextra’s withdrawal? Well, it’s not for the cardiac events that led to the Vioxx disaster. The FDA just wants more data on that from Pfizer. Nope, the FDA withdrawal notice cites, “Reports of serious and potentially life-threatening skin reactions, including deaths, in patients using Bextra.”
That’s right: “life-threatening skin reactions”.
Well, I couldn’t leave that alone, so I had to find out exactly what sorta skin reactions can kill a dude. And then I found Stevens-Johnson syndrome.
Sure, at the sound of it, Stevens-Johnson syndrome oughtta just cause you to break out in slacks or drive a Volvo, but it turns out the be one monstrously messed-up medical condition. When the skin’s reaction is “sloughing off,” I understand where the “life-threatening” part comes in.
Still, that wasn’t the weirdest thing that I came across in my little research. No, it was the FDA’s drug info page for Bextra that wins that award. Because the FDA wants us to know the following:
Stop taking Bextra and call your doctor right away if you get:
Ã¢â‚¬Â¢ a burning stomach pain
Ã¢â‚¬Â¢ black bowel movements that look like tar
Ã¢â‚¬Â¢ vomit that looks like blood or coffee grounds
Now keep in mind, that’s before the serious issues with the drug arose.
And you guys wonder why I don’t quit this day job.