By Susan Johnson
Prescription drugs are a part of the health picture for millions of Americans. With new drugs constantly being introduced, Medicare and Medicaid regulations, and direct marketing to both physicians and consumers, finding your way through the U.S. health system is like traveling through a maze, with many side trails and potential pitfalls. What exactly is going on?
Prescription drugs are expensive, and consumers, who often have little chance to comparison shop, hope they are worth it. In The Truth About the Drug Companies: How They Deceive Us and What to Do About It (ISBN 0-375-76094-6, 2004, 2005 Random House Trade Paperback), author Marcia Angell, M.D., says: “Paying for prescription drugs is no longer a problem just for poor people. As the economy continues to struggle, health insurance is shrinking. Employers are requiring workers to pay more of the costs themselves, and many businesses are dropping health benefits altogether.” Now, with the Patient Protection and Affordable Care Act, there will be more regulations.
The pharmaceutical industry takes in more than $200 billion a year. Most of the data quoted by the author are from 2001, the most recent year for which information is complete. Several laws enacted in the 1980s were designed to facilitate tax-supported basic research into new products, called “technology transfer.” The most important law was the Bayh-Dole Act, which enabled universities and small businesses to patent discoveries coming from research sponsored by the National Institutes of Health (NIH), and then to grant exclusive licenses to drug companies. This gave a great boost to the biotechnology industry, as well as to big pharma. Drug companies no longer have to rely on their own research for new drugs, and few of the large ones do. Mostly, they rely on academia, small biotech start-up companies, and the NIH.
Beginning in 1984, with the Hatch-Waxman Act, Congress passed another series of laws that extended monopoly rights for brand-name drugs. After exclusive marketing rights expire, copies (generic drugs) enter the market, and the price may fall to as little as 20 percent of the original price. There are two kinds of monopoly rights — patents granted by the U.S. Patent and Trademark Office (USPTO) and the Food and Drug Administration (FDA).
When their profits skyrocketed during the 1980s and 1990s, the drug companies increased their political clout. They could influence Congress to change things they didn’t like. But in 2000, things began to go wrong. As the economic boom of the late 1990s turned sour, many successful businesses were in trouble. As tax revenues dropped, state governments also had financial problems. And recently, employers and the private health insurers have started to rebel against drug costs. State governments are also looking for ways to cut drug costs. Some state legislatures are crafting measures that would permit them to regulate prescription drug prices for state employees, Medicaid recipients, and the uninsured.
But as patents on drugs expire, companies are hard pressed to make up the loss in profits. Very few new drugs come along to take their place. The great majority of drugs coming out are variations of old ones — the “me-too” drugs. All of these are aggressively promoted to physicians.
Author Angell thoroughly explains how the drug industry has evolved to meet the changing economic business climate. It’s a fascinating, but unsettling, story. She explains how the lines become blurred between education and marketing, what is actually expended in research and development, how legitimate (or not) are clinical trials. If a pharmaceutical company contracts with a university or research institute to conduct studies of its particular product, hoping for positive outcomes, how reliable are the results? If doctors (and their spouses) are taken to a vacation resort to hear speakers at a convention, and you throw in a few hours of golf and meals, does this “education” comply with the regulations of the 2002 PhRMA Code on Interactions with Healthcare Professionals? Maybe physicians are learning about possible “off-label” uses for a drug — purposes other than its original intent. Whether doctors are recruited as speakers for the drug or simply members of the audience doesn’t seem to matter. Is this legal? If the physicians can be classified as “consultants,” it probably is.
Clinical trials are another sticky area, especially the Phase IV trials. In Phases I through III, clinical trials are concerned with getting initial FDA approval and must meet certain scientific standards. But Phase IV trials are studies of drugs already on the market, and for many of these, no standards apply. There are two legitimate reasons for Phase IV studies — to see whether a drug is effective for an additional use and get FDA approval to market it for that, or to look for side effects, or other properties of the drug that were missed in earlier trials.
But the majority of Phase IV studies fall into neither category. The purpose is simply to increase sales — so-called surveillance studies. Sponsors pay doctors to prescribe drugs for patients and answer a few questions on how it worked. There is no randomization and no comparison group, so you cannot draw any reliable conclusions. Since the majority of Phase IV studies will never be submitted to the FDA, they may be totally unregulated, and few are published.
Then, there are the cases where it is questionable whether a drug should be prescribed at all, or whether some lifestyle change, such as diet and exercise, would be a better solution. Also, when people are taking multiple drugs, this is a practice called “polypharmacy,” and side effects can be increased.
The author, who is herself a physician, is also married to one. Together, they wrote an article about the pharmaceutical industry called “America’s Other Drug Problem — The Insatiable Greed of the Pharmaceutical Industry,” published in the Dec. 16, 2002, issue of The New Republic. This book was largely based on that article. Angell and her husband were both editors of The New England Journal of Medicine from 1977 to 2000.
Although this book was published in 2004, it is still relevant to conditions in the pharmaceutical industry today. The author makes several practical suggestions for addressing the problems covered in this book. Especially now, as more Americans are brought into the government insurance program, the need for efficiency and elimination of excessive profits at consumers’ expense will become paramount. Safety needs to take precedence over profit. We can only hope that someone in the healthcare industry is listening.
From the June 26-July 2, 2013, issue