I came across two articles over the weekend that resonated with me, both putting forward the case that – despite what the mainstream media, public policy ‘experts’ and the political class would have you believe – we are not doomed. Indeed, there is a lot to be positive about.
The first article is a plea from a German physicist in response to the hysterical reporting of the Fukashima incident:
The media suggests a nuclear catastrophe, a mega-meltdown, and that the apocalypse has already begun. It is almost as if the 10,000 deaths in Japan were actually victims of nuclear energy, and not the earthquake or the tsunami. Here again one has to remind us that Fukushima was first hit by an unimaginable 9.0 earthquake and then by a massive 10-meter wave of water just an hour later … Yet, after an entire week, the apocalypse still has not come to pass. Only relatively small amounts of radioactive materials have leaked out and have had only a local impact. If one considers the pure facts exclusively, i.e. only the things we really know, then it exposes the unfounded interpretations of scientific illiterates in the media. One can only arrive to one conclusion: This sorrowful state will remain so.
The second article takes in a wider perspective, and ties into something I hope to write about shortly – namely how the mainstream media continues to pump out scare story after scare story (and how in general we keep on being taken in):
Why do we insist on ruining the life that we have – which for those of us who are children of the 40s and 50s, is probably the best anyone has ever known, by living in fear of the life we might not have come tomorrow morning….? Enjoy today! Go on, fry a salmonella egg with some dioxidic Danish bacon, slip it between two trans fatty acid spread slices of cancer creating white bread, sup a mug of cancer causing hot tea, and reflect on the fact that you are still alive, you can still whinge about how bad life is – or you could reflect on your good fortune to have been of a generation and a country that has enjoyed a more privileged life than 99.9% of the world.
I was perusing Deloitte’s Global 2010 Survey of Health Care Consumers: Cross-Country Report (H/T @ritters90) the other day, and one finding in particular leapt out at me (see p.15):
Consumers, especially in the US, Canada and UK, prefer primary care physicians who are prescriptive in their approaches. British consumers state the highest preference for physicians who act as a medical authority (44%), who directs them to take what he/she believes is the best approach based on their own expertise, compared to 22% of Swiss and French consumers (lowest).
Personally, my preference is for what people on the continent seem to want – namely a doctor “who acts as a health coach [and] provides guidance and information needed for consumers to make their own decisions“. In an age where vast amounts of information is available online on pretty much every medical condition, the role of the doctor as some sort of authority figure who does not engage with the patient is overdue for retirement.
Yet clearly, this is not the opinion of the majority of my peers in the UK. Why is this? Would you blindly take the advice of an estate agent when considering whether to take a massive mortgage on a house? Would you consider accepting the simple recommendation of the car salesman on which of his cars to buy after walking into a showroom? No? Then why the blind faith in physicians?
Obviously, the analogies above are extreme, but I hope my point is made? Overall, I think that this is one of the perspectives on life in general that people on the continent have that should be adopted over here as soon as possible!
A few days ago I spotted (and tweeted about) an article published in the New York Times:
This year alone, because of patent expirations, the drug industry will lose control over more than 10 megamedicines whose combined annual sales have neared $50 billion.
This is a sobering reversal for an industry that just a few years ago was the world’s most profitable business sector but is now under pressure to reinvent itself and shed its dependence on blockbuster drugs.
This is, in of itself, not news – this ‘patent expiry cliff’ has been expected for some time now. What was interesting for me was a discussion that I got into with @DanBax76 on Twitter. In response to my comment to the piece, namely that a paradigm shift in the Pharma industry is due, Dan’s response was that such a change is already underway.
The question is: what constitutes a paradigm shift in the context of the Pharma industry? To be sure, major changes are underway – clearly the era of the blockbuster brand is coming to an end. From the NYT article cited above:
“We have to fix our innovative core,” Pfizer’s new president, Ian C. Read, said in an interview recently. To do that, the company is refocusing on smaller niches in cancer, inflammation, neuroscience and branded generics — and slashing as much as 30 percent of its own research and development spending in the next two years as its scientists work on only the most potentially profitable prospects.
Does cherry-picking only the most profitable therapeutic areas and drugs constitute a paradigm shift in the industry?
An article on the same topic in Motley Fool sees the industry shifting wholesale from pharmaceuticals to biologics, and a re-focus on emerging markets:
So is this an industry doomed to a slow, lingering death? Well, actually, no. There is a future for the pharmaceutical sector. But it will be a future quite different from its past.
The future lies in biologics. Whereas most drugs of today are chemical medicines, biologics are biological medicines such as, for example, antibody treatments, vaccines, and stem cells.
These drugs are expensive to produce but they are highly effective and are often used to treat diseases with no cheaper alternative. They tend to be sold at a very high price, and thus at a considerable margin.
Does switching from pharmaceutical products to biologics, which attract much higher margins and – quite helpfully – are not straight-forward to copy by competitors once your patent expires (note the lack of any change in the underlying business model here) constitute a paradigm shift in the industry?
Perhaps the rapid and quite exciting changes that we are seeing in terms of how social media is redefining the healthcare landscape constitute a paradigm shift? Well, maybe, but I am not convinced that things will change that much while we still have a monolithic, state-run healthcare system like we have in the UK; by its very nature the system prevents patients from exercising the personal choice in how they want to be treated that will result from the increased education and awareness that social media is fostering among patients.
In my opinion, none of the above constitutes a paradigm shift in Pharma, or the healthcare industry in general for that matter. Obviously, this is the place where I would jump up and say “I have the answer!!”, which would be a big lie. That said, there are some people out there who have questioned the status quo. For starters, what would happen if we got rid of patent law?
What about pharmaceuticals? Some people argue that we need pharmaceutical patents because drugs require expensive R&D to develop, but then can be cheaply reverse engineered. So, the thinking goes, if we don’t give drug makers patent protection, they won’t bother to produce drugs in the first place.
Numerous facts undermine this argument. Boldrin and Levine have found that the pharmaceutical industry historically grew “faster in those countries where patents were fewer and weaker.” Italy, for one, provided no patent protection for pharmaceuticals before 1978, but had a thriving pharmaceutical industry.
Another fact the conventional view overlooks is that patentable drugs are not the only medical innovations possible. Boldrin and Levine looked to a poll of the British Medical Journal’s readers on the top medical milestones in history, and found that almost none had anything to do with patents. Penicillin, x-rays, tissue culture, anesthetic, chlorpromazine, public sanitation, germ theory, evidence-based medicine, vaccines, the birth-control pill, computers, oral rehydration theory, DNA structure, monoclonal antibody technology, and the discovery of the health risks of smoking — of these top 15 entries, only two had anything to do with patents. Similarly, nothing on the US Centers for Disease Control’s list of the top ten public-health achievements of the 20th century had any connection to patents.
Patent law does create one incentive for researchers: to pursue more of the kind of research that will lead to patentable drugs, and less of the kind of research that might lead to other types of breakthroughs that cannot be patented — even though, as we’ve just seen, the latter kind may be some of the most important. If patent law were abolished, we would probably see fewer artificial chemical drugs and more discoveries related to remedies from natural substances such as vitamins, minerals, and plants. Given the harmful side effects of many prescription drugs, it is not at all obvious that this would be a bad thing.
Boldrin and Levine also show that patents are not essential to success in the pharmaceutical industry by pointing to the analogous paint and dye industries (which also depended on chemical formulas) in the 19th century. Germany offered no patent protection for paints and dyes at all until 1877, and even then only for the process involved in producing them, not for the products themselves. Nonetheless, German companies’ market share rose from next to nothing in 1862 to 50 percent in 1873 and 80 percent in 1913. Britain and France, on the other hand, had patent protection for both products and processes all along and saw their market shares fall from about 50 percent and 40 percent, respectively, in 1862 to between 13 and 17 percent in 1873.
Much more topical bearing in mind what is going on in the US with Obamacare at the moment, and the raging controversy in the UK over the proposed reforms of the NHS, is the proposal to actually create a proper free healthcare market (i.e. with no Government regulation, with the customer as ‘king’).
All quite challenging ideas, I’m sure you’ll agree, but perhaps necessary to include in the ongoing debate about where our industry goes from here. The status quo perhaps does not cut it any more…