health care ethics

“Honor Amongst Thieves” — A Perspective on the Access to Medicine Index

iStock_000004475255MediumEach year, the Access to Medicine Foundation publishes a hierarchical list of pharmaceutical companies ranked on their efforts to improve access to medicine in developing countries.”  See: Without wanting to diminish the good intention of this group, the index, from my cynical perspective, may denote little more than the level of “honor” amongst thieves.

Gilead — the Poster Child:

 While seemingly noble on the surface, one does not need to dig deeply to discover the degree to which these companies are vastly more concerned with quarterly returns to shareholders than altruistic actions that benefit global health. Take Gilead Science, for instance, and the company’s perceived, initial reluctance to discount Sovaldi – a breakthrough drug in the treatment of Hepatitis C. The undiscounted cost for a course of treatment is approximately $85,000. According to a June article in Forbes, “Sovaldi costs about $130 to manufacture, reinforcing how outrageous its pricing is.”

Yet, it was only after being cast as the poster-child for egregious profiteering that Gilead reassessed its stance on the cost and availability of Sovaldi. The organizations that spoke out about Gilead’s pricing were formidable, as evidenced by an article appearing in the April 11, 2014 edition of Bloomberg News stating: “The WHO yesterday called for ‘‘a concerted effort’’ by various stakeholders to lower the cost of the drug.”

Implicit in the WHO comments was a threat that generic versions could be produced independently of Gilead: “In addition to tiered pricing, voluntary and compulsory licensing, where generic-drug makers are given permission to produce more affordable versions of a medicine, can also help achieve affordability, the WHO said.”

Bowing to Pressure:

In response to increasing public pressure and the potential loss of control of their golden goose, Gilead slashed the costs of Sovaldi to selective countries, such as Egypt and India, where there are large populations of infected individuals that lack the resources to pay for the drug. Yet, they did little to address the drug’s unaffordability to the myriad of indigent patients in economically developed countries.

It’s worth noting that Gilead acquired the ability to manufacture Sovaldi through the purchase of Pharmasset at the cost of $11 billion. Amazingly, “Gilead is on pace to recoup the full cost of its $11 billion investment in just over one year. That is unprecedented,” according to the Forbes article.

Deanna Beasley, writing for Reuters, quoted Brendan Buck, a spokesperson for America’ Health Insurance Plans, as stating: “The blank check mindset we’ve seen from Gilead is a threat to our entire health care system, and we hope they will pursue more sustainable pricing in the future.” Gilead ranks fifth from the top (out of twenty) on the Access to Medicine list.

18/20 Companies Guility

It is unfair to single-out Gilead as the greedy one amongst pharmaceutical and biotech firms. As a recent New York Times article pointed out, “Eighteen of the 20 companies in the index have settled or been convicted of unethical marketing, unfair competition or bribery in the last two years.”

Again, I applaud the foundation’s efforts. Whether its list  is a noble attempt to improve transparency within the pharmaceutical industry and catalyst for greater altruism or simply lipstick on the pig, I will leave up to you…my reader.  


iStock_000014969854SmallThere is a fascinating article in a recently published, special edition of Forbes detailing efforts by Novartis to become the leading force in cancer therapeutics. The article begins with a powerful and poignant story in which a breakthrough therapy brings a new lease on life to a young girl (as well as numerous other individuals who were involved in an early-stage trial).

Applauding Medical Breakthroughs:

No one, with a shred of compassion, would find anything but joy in the revelation that great strides are being made in treating previously devastating cancers; and there need to be incentives in place for corporations to pursue such work – since our economy is not driven by altruism. But there are troubling aspects to this story as well…as evidenced by comments made to Forbes by Novartis CEO, Joseph Jimenez.  

Separating Science from Sales:

As Forbes notes, cancer drugs currently account for just under 20 percent of Novartis’ total sales – bringing in $11.2 billion annually. Now, according to Mr. Jimenez, “He’s ‘doubling down’ on the cancer business” – an expression I would normally reserve for a bet at the blackjack table.

Where’s the proof? “In April he did a deal that essentially traded Novartis’ unprofitable vaccine and consumer businesses and up to $9 billion in cash to GlaxoSmithKline in return for Glaxo’s cancer drugs, which currently generate $1.6 billion sales but which Jimenez says include three pills he can turn into $1 billion sellers.”  

From Consumer Goods to Cancer Cures:

From a profit-making perspective, Mr. Jimenez strategy to become the leading force in the emerging field of personalized medicine seems astute. He is, after all, a “Marketer by trade who, until he came to Novartis in 2007, managed brands like Clorox and Peter Pan Peanut Butter before running the North America business for Heinz, the ketchupmaker.”

But we are not talking about whitening our clothes, satisfying a sweet tooth, or putting a topping on a burger. We’re talking about life and death stakes for millions of cancer patients in the future.

As Mr. Jimenez executes his market strategy and potentially gains increasing clout in controlling what may prove to be true cures for cancer, what will prevent Novartis from leveraging its power over the lives of cancer patients by raising the prices of newly developed products to the very edge of what the market can bear…and is there a precedent for concern?

Reasons for Concern:

Novartis already produces a “miracle drug” known as Gleevec. It has made a life and death difference for some patients. Forbes notes, “Patients stay on it for years, and it is so valuable that Novartis has quadrupled its annual price from $24,000 per year in 20001 to more than $90,000 today.” The article goes on to state: “What the marketers thought was a $400 million drug, Jimenez notes, is now a $4.6 billion one…”

What will Novartis do in the future…what is morally right or what the market will bear? Mr. Jimenez, I’m truly grateful for the research you are funding, but wonder who will be whispering in your ear, “Are we doing the right thing for both our shareholders and our patients?