In recent years, the delicate equilibrium between private profit and public benefit which was once central to the drug industry has shifted.
by Billy Kenber
Following excerpts adapted from the author’s book, “Sick Money: The Truth About the Global Pharmaceutical Industry” published by Canon Gate
The first reports to reach the Western public were buried towards the back of newspapers. Terse accounts told of a mysterious pneumonia outbreak afflicting a couple of dozen people in the industrial city of Wuhan, China. It was a New Year curiosity but no real cause for alarm. Then the mysterious virus started to escalate. Hundreds of people coming down with respiratory problems and a fever. Hospital beds filling fast. The death toll rising. Wuhan was closed to outsiders as government officials oversaw the rushed construction of new medical facilities.
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| Miniature figures with pills. [Etactics Inc/Unsplash] |
The novel coronavirus – named SARS-CoV-2 – was believed to have originated in bats before making the jump to humans. By mid-January 2020 scientists had decoded the virus’s genome sequence and published it but they could do little to stop its spread. Soon it was in Europe, fast infecting thousands in the chalets and après-ski bars of the Italian Alps. By late March the world had shut down.
With economies paralysed and healthcare systems at risk of being overwhelmed by the influx of previously healthy patients struck down with the new virus, all eyes turned to science and the hope that treatments could be identified and developed. Above all, over the months that followed, the world held its breath for a vaccine: the only clear route to returning life to its normal axis.
Instrumental to this effort would be the vast $1 trillion global industry dedicated to the discovery, production and sale of medicines. The pandemic vividly illustrated the importance of these companies – from large drugmakers producing billions of vaccine doses to the smaller biotechs who helped develop groundbreaking new vaccine technologies. It was an indication of the debt society owes to the grit and ingenuity of scientists and the machinery that helps translate their efforts into medicines. But it also exposed the industry’s flaws and served as a reminder of some of its worst impulses.
The pharmaceutical industry’s success in helping to deliver vaccines was largely the result of governments in the US and Europe committing billions in public funding to make up for drug companies’ reluctance to invest in areas long considered insufficiently profitable. Meanwhile, the public-spirited actions of some drugmakers, coaxed by university scientists into selling vaccines at cost, served only to highlight the contrast with the rest of the industry’s avaricious business-as-usual approach. Even those large drug companies who promised to eschew profits from a vaccine made it clear this would only be while the pandemic raged, reserving the right to make a fortune in future if, as expected, it were to become a seasonal virus.
For others, a global health emergency was as good a time as any to make a killing. The head of one large pharmaceutical company boasted to investors that a coronavirus vaccine generating monthly sales of more than $1 billion would see price rises once the initial crisis was averted. Another drugmaker charged up to $3,000 per patient for an existing drug repurposed as a five-day treatment for Covid-19 that shortened hospital stays but had no impact on mortality rates. Rich countries were allowed to buy up the vast majority of early vaccine stocks while drug companies declined to share manufacturing know-how and intellectual property rights with less well-off nations.
The sense of duty to the common good displayed by a handful of drug companies marked only a brief suspension of the slavish adherence to the best interests of shareholders and the ideology which normally governs decision-making: maximise profits, no matter the cost.
Since the Second World War a succession of pharmacological revolutions have transformed healthcare, dramatically improving life expectancy and saving countless lives. For much of that time, large pharmaceutical companies and the scientists who led them were revered; viewed as both vital engines of economic growth and as corporations with a sense of moral purpose. Underlying this was a simple premise: a social contract where society traded a period of exclusivity guaranteed by patent law as the reward for expensive but worthy research into discovering novel drug therapies, followed by medicines becoming cheap commodities readily prescribed by doctors around the globe. The deal guaranteed healthy compensation for those companies which navigated the long odds of drug development – where nine out of ten drugs fail in clinical trials – and expected, in return, that this would not be exploited by profiteering.
But in recent years, the delicate equilibrium between private profit and public benefit which was once central to the drug industry has shifted. The social contract has broken and the giants of Big Pharma have fallen from their perch as some of the most respected companies in the world to become the comic-book villains of Hollywood films and hit television series.
While the industry hopes that its role in developing Covid-19 vaccines will help to restore its standing, the reputational collapse it suffered happened for good reason. On the other side of the ledger to the innovative products the pharmaceutical industry brings to market sits a lengthy charge sheet: the drugs with minimal clinical benefits; the lawsuits and lobbying; the marketing abuses and bribes paid to doctors; the tricks and tactics used to artificially extend patent lengths and, above all, the often sky-high prices charged for medicines.
In many countries, drug prices have never been higher and have never risen faster. During the 2010s, inflation-adjusted drug prices in the United States rose at a faster rate than in any other decade. Across Europe, patients are being denied drugs that could save their lives because the health systems of some of the richest countries on earth can’t afford to meet the prices demanded. In Africa and vast swathes of the subcontinent, billions have become accustomed to having no access to many modern medications.
This drug-pricing crisis is not limited to the newest drugs protected by patents. It afflicts old medicines too, as was conspicuously demonstrated by pyrimethamine, a small white pill the same size and shape as the aspirin or paracetamol tablets found in every bathroom cabinet. The drug, developed by scientists in the 1950s as an antimalarial, is used to treat a parasitic infection which can cause serious health issues for pregnant women and those with compromised immune systems, including patients with AIDS. In 2015, Martin Shkreli, a former hedge-fund manager, drew front-page headlines when he hiked the price of the drug from $17.50 to $750 per pill. Far from shrinking from the sudden scrutiny, Shkreli revelled in the notoriety it brought. Did he regret raising the price? No, he said. If anything, he wished he’d raised it more.
The established players of Big Pharma were quick to distance themselves and denounce Shkreli’s behaviour. But whilst his actions – and those of other price-hiking businessmen – were extreme, the reality is they were symptoms of the industry’s wider transformation over the preceding decades. These research-free, profiteering companies were the legacy of how detached many drugmakers had become from the science-led forebears who had focused on developing useful treatments and selling them at a reasonable price.
You don’t need to discover drugs to get rich from them any more. Access to medicine is a fundamental human right but for many executives pharmaceuticals have become little more than financial assets, to be flipped, dealt, exploited and manipulated in a myriad of creative and profitable ways. For some, this is an opportunistic response to flawed markets and a lack of resistance from health systems and insurers. For others, particularly the large research-driven companies of Big Pharma, it is driven by shifting attitudes in board-rooms, new ideas about how to run a company and price medicines and by the legitimate challenges of translating scientific knowledge into clinically useful products.
Copyright © Billy Kenber
Billy Kenber is an investigative journalist at The Times and has worked at the newspaper since 2010. He has won several accolades including prizes at the UK Press Awards, the British Journalism Awards and two prizes from the Medical Journalists’ Association including the 2017 award for Outstanding Contribution to Health or Medical Journalism. In 2013 he won the Laurence Stern Fellowship and worked for the Washington Post for three months. He lives in London.
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