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Omeris President Tony Dennis, PhD
AstraZeneca CEO David Brennan
Mr. David Brennan
Remarks on September 4, 2003
THANK YOU, TONY, VERY MUCH. IT IS ALWAYS A PLEASURE TO BE AMONG FRIENDS, AND THAT IS CERTAINLY HOW I FEEL THIS AFTERNOON.
I’VE BEEN EAGERLY LOOKING FORWARD TO MEETING WITH YOU TODAY – IN PART, OF COURSE, BECAUSE OF THE COMMONALITY OF OUR INTERESTS. I LONG AGO DECIDED THAT THOSE OF US WHO WORK IN THE PHARMACEUTICAL AND BIOSCIENCE FIELDS ARE SOME OF THE WORLD’S MOST FORTUNATE PEOPLE. IT ISN’T EVERY CAREER OR OCCUPATION THAT CARRIES WITH IT SUCH A TREMENDOUS SENSE OF MISSION AND SUCH EXTRAORDINARY REWARDS. IT ISN’T EVERY FIELD OF ENDEAVOR IN WHICH YOU CAN SEE INNOVATIVE IDEAS TURNED INTO GROUNDBREAKING PRODUCTS WHICH PROFOUNDLY AFFECT LIVES.
THE 80 ORGANIZATIONS THAT MAKE UP OMERIS ARE LEADERS IN MAKING THESE INCREDIBLE SUCCESSES HAPPEN. YOUR RANKS INCLUDE MIGHTY HEALTH CARE GIANTS LIKE PROCTER AND GAMBLE IN CINCINNATI AND CARDINAL HEALTH IN COLUMBUS, AS WELL AS PROMISING, EXCITING STARTUPS LIKE COPERNICUS THERAPEUTIC, DOING SUCH IMPORTANT WORK ON CYSTIC FIBROSIS, AND IMALUX, WHOSE WORK ON OPTICAL COHERENCE TOMOGRAPHY IS GAINING GREAT ATTENTION. YOU ARE ALL THE LIFEBLOOD OF THIS INDUSTRY.
IN ADDITION TO OUR COMMON INTERESTS, THOUGH, I’M ALSO VERY PLEASED TO BE HERE BECAUSE WE HAVE SOME VERY IMPORTANT MATTERS TO DISCUSS. INSTEAD OF WEARING MY NORMAL ASTRA-ZENECA HAT, I’M HERE TODAY REPRESENTING MY FELLOW MEMBERS OF THE PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA – PHRMA. AND THE TOPIC OF MY REMARKS IS, AS YOU SEE IN YOUR PROGRAM, “THE FUTURE NEEDS OF PHARMACEUTICAL DEVELOPMENT.”
I’LL TELL YOU WHAT, THOUGH. LET’S JUST PUT THAT TITLE ASIDE. YES, I AM GOING TO TALK ABOUT THE FUTURE NEEDS OF PHARMACEUTICAL DEVELOPMENT, BUT I THINK THAT TITLE IS A LITTLE TOO LIMITED IN SCOPE. OVER THE TIME WE HAVE TOGETHER THIS AFTERNOON, I WANT TO SHARE SOME THOUGHTS ABOUT SOMETHING MUCH MORE FUNDAMENTAL TO THE FUTURE OF PHARMACEUTICAL DEVELOPMENT. LET’S TALK TODAY ABOUT SOME BASIC, CRITICAL CHOICES THAT OUR COUNTRY MUST MAKE, AND THAT EVERY STATE IN THE UNION – INCLUDING THIS GREAT STATE OF OHIO – MUST MAKE REGARDING THE HEALTH, WELL-BEING AND FUTURE OF ITS CITIZENS.
WE LIVE IN A REMARKABLE AGE. THE DISCOVERIES AND ACHIEVEMENTS IN MEDICINE, IN PHARMACEUTICAL RESEARCH, IN BIOSCIENCE OVER THE PAST TWO DECADES FAR EXCEED ANYTHING THAT HAS BEEN ACCOMPLISHED OR COULD HAVE BEEN IMAGINED OVER THE COURSE OF HUMAN HISTORY. THE FORMER HEAD OF THE MAYO CLINIC ONCE SAID THAT TRYING TO GRASP THE ADVANCES IN HEALTH CARE AND MEDICINE OVER THE PAST QUARTER-CENTURY IS LIKE TRYING TO DRINK WATER FROM A FIREHOSE. IT’S IMPOSSIBLE TO COMPREHEND ALL THAT HAS TAKEN PLACE AND ALL OF THE LEAPS FORWARD WE CONTINUE TO TAKE.
AND YET, WE FIND OURSELVES AT A CRITICAL CROSSROADS. POLICYMAKERS IN WASHINGTON, IN COLUMBUS, IN STATE CAPITALS THROUGHOUT THIS COUNTRY, ARE WRESTLING WITH THE QUESTION OF HOW IMPORTANT IT IS TO CONTINUE THIS PACE OF PROGRESS. THERE IS A WIDE UNDERSTANDING OF WHAT HAS BEEN ACHIEVED IN OUR LIFETIMES. WE ARE NOW ABLE TO TREAT CONDITIONS FROM ASTHMA TO HIGH CHOLESTEROL THAT WERE ONCE CONSIDERED UNTREATABLE. AND WE ARE ON THE DOORSTEP OF MAJOR BREAKTHROUGHS, MAJOR OFFENSIVES AGAINST DISEASES LIKE CANCER AND HEART DISEASE. BUT NOW, U.S. SENATORS AND REPRESENTATIVES, GOVERNORS AND STATE LEGISLATORS ARE DEBATING WHETHER THE TIME HAS COME TO SLOW DOWN THE DEVELOPMENT OF NEW LIFESAVING AND LIFE-ENHANCING BREAKTHROUGHS.
WE CAN ALL UNDERSTAND AND EVEN SYMPATHIZE WITH THE PLIGHT POLICYMAKERS FIND THEMSELVES DEALING WITH TODAY. WE HAVE AN UNFORTUNATE DICHOTOMY IN HEALTH CARE. AS I’VE NOTED, WE LIVE IN AN AGE OF MEDICAL MIRACLES, AND YET TOO MANY AMERICANS DON’T HAVE ACCESS TO THESE MIRACLES. OVER 40 MILLION MEN, WOMEN AND CHILDREN IN THIS COUNTRY DO NOT HAVE HEALTH INSURANCE. MOST OF THE UNINSURED ARE LOW-INCOME WORKERS WHO HAVE A DIFFICULT TIME FINDING THE DOLLARS TO SEE A DOCTOR OR PAY FOR A PRESCRIPTION AT THE DRUGSTORE.
AND WHO HASN’T SEEN THE UNFORTUNATE STORIES ON THE NEWS OF SENIOR CITIZENS WHO HAVE HAD TO CHOOSE BETWEEN EATING A DECENT MEAL AND AFFORDING THE MEDICINES THEY NEED FOR THEIR CHRONIC HEALTH CONDITIONS?
WHY ARE SENIORS FACING THESE DIFFICULT CHOICES? IN SOME CASES SENIORS SIMPLY DO NOT KNOW ABOUT AVAILABLE DRUG COVERAGE THROUGH MEDICAID, THE VETERANS ADMINISTRATION, OR COMMUNITY OR INDUSTRY ASSISTANCE PROGRAMS.
BUT FUNDAMENTALLY, THE PROBLEM STEMS FROM A MEDICARE PROGRAM THAT DOESN’T PROVIDE PRESCRIPTION DRUG COVERAGE.
CONGRESS, INCLUDING SENATORS VOINOVICH AND DEWINE AND YOUR WELL-RESPECTED HOUSE DELEGATION, IS TRYING TO RECTIFY THAT DEFICIENCY, BUT THEY HAVE A TOUGH ROAD AHEAD.
SO, IF YOU’RE HOLDING A LEGISLATIVE OFFICE, SERVING AT THE WILL OF THE PEOPLE, AND YOUR CONSTITUENTS ARE TELLING YOU THAT THEY CAN’T AFFORD THE PRICE OF PRESCRIPTION DRUGS, WHAT DO YOU DO? YOU HAVE NO CHOICE BUT TO RESPOND WITH SOME FORM OF POLICY SOLUTION TO MAKE MEDICINE MORE AFFORDABLE.
AND THAT’S THE ENVIRONMENT THAT BRINGS US TO THE QUESTION OF FUNDAMENTAL, CRITICAL CHOICES.
SOME POLITICIANS BELIEVE THAT THE POLICY APPROACH OF LEAST RESISTANCE AND MINIMAL CONSEQUENCE IS TO IMPOSE PRICE CONTROLS ON PRESCRIPTION DRUGS. WE SEE THIS HAPPENING WITH ALARMING FREQUENCY IN WASHINGTON. IF YOU’VE WATCHED THE MEDICARE DEBATES OVER THE PAST COUPLE OF YEARS, YOU HAVE SEEN AMENDMENT AFTER AMENDMENT INTRODUCED TO USE PRICE CONTROLS AS A PRIMARY MECHANISM TO KEEP COSTS DOWN.
THE MOST POPULAR IDEA DU JOUR IS TO USE DRUG REIMPORTATION TO CONTROL COSTS. THE U.S. HOUSE OF REPRESENTATIVES PASSED LEGISLATION THIS SUMMER THAT WOULD ESSENTIALLY OPEN OUR BORDERS TO PRESCRIPTION DRUGS SHIPPED FROM COUNTRIES THAT DON’T HAVE THE QUALITY CONTROLS, THE SAME KIND OF SAFEGUARDS THAT WE HAVE IN THIS COUNTRY. THE IDEA, OF COURSE, IS TO IMPORT THE PRICE CONTROLS OF CANADA AND EUROPE TO THE UNITED STATES.
THE POLITICAL POPULARITY OF THIS APPROACH IS ACTUALLY QUITE STUNNING. NEVER MIND THE FACT THAT FOOD AND DRUG ADMINISTRATION COMMISSIONERS FROM BOTH DEMOCRATIC AND REPUBLICAN ADMINISTRATIONS HAVE SAID IT’S A BAD, DANGEROUS IDEA. NEVER MIND THE FACT THAT THE WORLD HEALTH ORGANIZATION HAS SAID THAT 10 PERCENT OF THE MEDICINES IN CIRCULATION IN THE WORLD ARE COUNTERFEIT AND POTENTIALLY HARMFUL, AND THAT THE PROBLEM IS GETTING WORSE INSTEAD OF BETTER.
EVEN KNOWING THAT PEOPLE MAY END UP LEAVING THEIR CONDITION UNTREATED BECAUSE THEY’RE TAKING NOTHING BUT THE EQUIVALENT OF SUGAR PILLS, OR EVEN WORSE, TAKING A COUNTERFEIT PILL THAT MAY MAKE THEM VERY ILL, THE HOUSE STILL PASSED DRUG REIMPORTATION BY A WIDE MARGIN.
IMPORTATION WILL NOT SOLVE THE PROBLEM OF ACCESS TO PRESCRIPTION DRUGS. OVER 20 YEARS’ EXPERIENCE IN THE EUROPEAN UNION HAS SHOWN UNEQUIVOCALLY THAT ANY POTENTIAL FINANCIAL SAVINGS ARE NOT PASSED ON TO PATIENTS.
STATES LIKE OHIO HAVE TO MAKE CHOICES, AS WELL. I WANT TO TAKE A MOMENT HERE TO SAY A WORD ABOUT THE OHIO GOVERNOR AND HIS ADMINISTRATION.
GOVERNOR TAFT HAS SHOWN THAT HE UNDERSTANDS THE VALUE OF THE BIOSCIENCES TO THE PEOPLE OF OHIO. HIS THIRD FRONTIER PROJECT IS A REFLECTION OF THIS UNDERSTANDING. BY CREATING A 10-YEAR-PLAN TO ATTRACT MORE SCIENTIFIC, MEDICAL AND TECHNOLOGICAL RESEARCH INVESTMENT TO THE STATE, GOVERNOR TAFT HAS CLEARLY LINKED OHIO’S ECONOMIC FUTURE TO A VIBRANT, THRIVING BIOTECH INDUSTRY.
THE PLAN INCLUDES THE CREATION OF A $500 MILLION BIOMEDICAL RESEARCH AND TECHNOLOGY TRANSFER FUND AS WELL AS ANOTHER $500 MILLION BOND PROGRAM TO RECRUIT STATE-OF-THE-ART RESEARCH FACILITIES TO THE BUCKEYE STATE. IT’S A GOOD IDEA. NO, IT’S A GREAT IDEA. AND I WOULD LIKE NOTHING MORE THAN TO SEE THIS STATE SUCCEED IN MOVING TO THE CUTTING EDGE OF 21ST CENTURY DISCOVERY.
BUT, OHIO HAS ITS OWN CHOICES TO MAKE.
YOU SEE, IF YOU LOOK CLOSELY AT WHAT’S HAPPENING HERE IN OHIO, YOU SEE THE STATE MOVING IN TWO DIAMETRICALLY OPPOSING DIRECTIONS. ON ONE HAND, YOU HAVE A TRULY VISIONARY APPROACH LIKE THE THIRD FRONTIER PROJECT. ON THE OTHER, THOUGH, YOU’RE SEEING THE GROWTH OF A PHILOSOPHY HERE IN OHIO SIMILAR TO THAT TAKING ROOT IN WASHINGTON – THE BELIEF THAT YOU CAN MAKE HEALTH CARE BETTER BY IMPOSING ARTIFICIAL GOVERNMENT CONTROLS ON PHARMACEUTICAL PRICES.
SOME POLITICAL LEADERS AND ORGANIZATIONS ARE ATTEMPTING TO USE THE BALLOT INITIATIVE PROCESS TO INSTITUTE A STATEWIDE PRICE CONTROL SYSTEM THAT WOULD ESSENTIALLY TOSS AWAY MARKETPLACE PRINCIPLES AND TIE PRICES TO THE MEDICAID SYSTEM AND THE FEDERAL SUPPLY SCHEDULE. IN PLAIN LANGUAGE, IT WOULD REQUIRE PHARMACEUTICAL MANUFACTURERS TO SUBSIDIZE RETAIL DRUG PRICES FOR EVERY SINGLE OHIO RESIDENT.
UNFORTUNATELY, SUPPORTERS OF THIS BALLOT INITIATIVE DO NOT UNDERSTAND THE COMPLEXITIES AND THE RISK ASSOCIATED WITH DISCOVERING AND DEVELOPING NEW MEDICATIONS VITAL TO TREATING TODAY’S MEDICAL PROBLEMS AND THE DISEASES OF TOMORROW. IN ADDITION, THE SUPPORTERS OF THIS BALLOT INITIATIVE DO NOT UNDERSTAND HOW PRICE CONTROLS WILL UNDERMINE BIOTECHNOLOGY AND PHARMACEUTICAL RESEARCH FOR PATIENTS AFFLICTED WITH ILLNESSES FOR WHICH NO TREATMENTS EXIST.
BIOTECHNOLOGY FIRMS ARE HIGHLY DEPENDENT ON THEIR ABILITY TO RAISE WORKING CAPITAL FROM VENTURE CAPITALISTS, SOURCES OF MEZZANINE FINANCING AND, ULTIMATELY, IPOS. WE ARE ALL COGNIZANT OF THE DIFFICULTIES OF RAISING CAPITAL AND THE IMPORTANCE OF ECONOMIC POLICY ON THE WILLINGNESS OF PUBLIC MARKETS TO PROVIDE FUNDING. IT SEEMS INCONCEIVABLE THAT A STATE WHICH HAS PROVIDED AN INCUBATOR FOR BIOTECHNOLOGY WOULD ATTEMPT TO CONTROL PRICES.
THIS OHIO PROPOSAL IS VERY SIMILAR IN DETAIL AND SCOPE TO A PRICE CONTROL PROGRAM IN MAINE THAT WAS BEFORE THE U.S. SUPREME COURT WHICH, IN TURN, REMANDED IT BACK TO U.S. DISTRICT COURT WITH SUBSTANTIAL QUESTIONS. IT IS A SURE THING THAT THE MAINE PROGRAM, AFTER THIS JUDICIAL REVIEW, WILL LOOK SUBSTANTIALLY DIFFERENT THAN ITS CREATORS ENVISIONED.
RIGHT NOW, REPRESENTATIVES FROM BOTH SIDES OF THIS ISSUE – INCLUDING PHARMACEUTICAL COMPANIES AND THE OHIO COALITION FOR AFFORDABLE PRESCRIPTION DRUGS -- ARE HAVING MEANINGFUL DISCUSSIONS IN HOPES OF DISCOVERING COMMON GROUND AND DEVELOPING A WORKABLE SOLUTION.
FUNDAMENTAL CHOICES. CRITICAL CROSSROADS. WILL OHIO BE A STATE THAT ENCOURAGES AND NURTURES INNOVATION AND SCIENTIFIC DISCOVERY? OR WILL IT OPT INSTEAD TO STIFLE INNOVATION BY USING GOVERNMENT AS A TRUNCHEON TO BULLY ASIDE THE MARKETPLACE AND CONTROL PRICES?
MAKE NO MISTAKE ABOUT IT. CHOICES ARE NOT WITHOUT RAMIFICATIONS, BOTH POSITIVE AND NEGATIVE. PRICE CONTROL ADVOCATES HAVE TRIED TO PAINT THEIR POSITION AS ONE WITHOUT CONSEQUENCE. LET GOVERNMENT STEP IN TO CONTROL PRICES AND THE ELDERLY, THE UNINSURED, AND THOSE WITH A LOW-INCOME WILL HAVE CHEAPER DRUGS. PRICE CONTROL SUPPORTERS DISMISS CLAIMS FROM DRUG COMPANIES THAT RESEARCH AND DEVELOPMENT WILL BE AFFECTED AS IDLE RHETORIC, NOTHING MORE.
AS YOU KNOW VERY WELL, IN MATTERS OF SCIENCE AND MEDICINE, YOU DON’T DEAL IN RHETORIC, SUPPOSITION AND FALSE CLAIMS. YOU DEAL IN FACTS AND PROVABLE EVIDENCE. AND, IN DISCUSSING A SUBJECT AS IMPORTANT AS THIS ONE, THAT IS EXACTLY THE APPROACH WE SHOULD FOLLOW. OHIOANS NEED TO KNOW THE WHOLE STORY. THEY DESERVE BETTER THAN BUMPER-STICKER SLOGANS AND ROUSING RHETORIC THAT PROMISES LOWER PRICES WITH NO RAMIFICATIONS, NO CONSEQUENCES, NO DISTURBING SIDE EFFECTS. THEY NEED TO KNOW THE FACTS ABOUT THE PEOPLE IN NATIONS THAT HAVE ADOPTED PRICE CONTROLS. YOU CAN FIND THOSE PEOPLE IN OUR AIRPORTS AND ON OUR HIGHWAYS, COMING TO THE UNITED STATES FOR HEALTH CARE AND MEDICINES THEY CAN’T GET IN THEIR OWN COUNTRIES.
IT’S TIME TO PUT THE FACTS ON THE TABLE. LET ME BEGIN THAT PROCESS BY TELLING A BRIEF STORY THAT BEGINS WITH AN UNHAPPY PREMISE, BUT ENDS ON A NOTE OF EXCITING PROMISE.
THIS YEAR, MORE AMERICANS WILL DIE OF LUNG CANCER THAN OF ANY OTHER TYPE OF CANCER – OVER 150,000 DEATHS IN ALL. AND TO MAKE MATTERS WORSE, THIS YEAR ALONE ANOTHER 172,000 PEOPLE ARE EXPECTED TO CONTRACT LUNG CANCER – A DIAGNOSIS THAT HAS BEEN TANTAMOUNT TO A DEATH SENTENCE.
NOW, LET’S GO BACK IN TIME TO THE EARLY 1970’S. RESEARCHERS DISCOVERED ON THE SURFACE OF CELLS A RECEPTOR KNOWN AS EGFR, EPIDERMAL GROWTH FACTOR RECEPTOR. BY THE 1980’S, SCIENTISTS LEARNED THAT EGFR WAS A CONTRIBUTOR TO POOR PROGNOSES IN SEVERAL HUMAN CANCERS.
AND, BY 1988, IT WAS FURTHER LEARNED THAT BLOCKING THE TYROSENE KINASE ENZYME ACTIVITY OF EGFR CELLS COULD ACTUALLY INHIBIT CANCER CELL GROWTH.
IN 1990, ASTRA ZENECA – OR, AS IT WAS CALLED THEN, ICI – BEGAN WORK ON DEVELOPING A COMPOUND THAT COULD BLOCK THESE ENZYMES AND, THUS, HAVE A SIGNIFICANT EFFECT ON THE GROWTH OF CANCER CELLS IN HUMANS.
TO MAKE A LONG STORY SHORT, AFTER EIGHT YEARS OF WORK IN THE LABS, WE BEGAN CONDUCTING PHASE I CLINICAL TRIALS IN 1998. AND, FIVE YEARS AFTER THAT, THIS NEW DRUG, CALLED IRESSA, WAS APPROVED BY THE FOOD AND DRUG ADMINISTRATION ON MAY 5, 2003. IT IS THE ONLY EGFR INHIBITOR WHICH HAS MADE IT TO THE MARKET.
I TELL THE STORY OF IRESSA FOR TWO REASONS. ONE, IT ILLUSTRATES SOMETHING THAT ALL OF YOU KNOW QUITE WELL. THE DISCOVERY OF NEW LIFESAVING DRUGS DOES NOT HAPPEN OVERNIGHT, AND IT DOES NOT HAPPEN WITHOUT GREAT, SOMETIMES ASTRONOMICAL, EXPENSE.
AN INDEPENDENT STUDY AT TUFTS UNIVERSITY FOUND THAT IT COSTS AN AVERAGE $800 MILLION TO DEVELOP A NEW DRUG AND TAKE IT SUCCESSFULLY THROUGH ALL OF THE STEPS OF THE REGULATORY APPROVAL PROCESS. OVER $80O MILLION – FOR JUST ONE DRUG. AND FOR EVERY 10 DRUGS THAT INCUR THIS HUGE EXPENSE, ONLY THREE EVER EARN ENOUGH REVENUE TO MAKE BACK THEIR RESEARCH AND DEVELOPMENT COSTS OR PROVIDE A POSITIVE RETURN FOR COMPANY STOCKHOLDERS.
ONE COMPANY ALONE, ASTRA-ZENECA, SPENDS $11 MILLION EVERY SINGLE WORKING DAY TO RESEARCH AND DEVELOP NEW MEDICATIONS. AND WE’RE JUST ONE PLAYER IN AN INDUSTRY THAT INVESTS OVER $30 BILLION ANNUALLY IN R&D.
EVERY SINGLE ONE OF YOU IN THE BIOTECH FIELD KNOWS THAT THIS IS NOT AN INDUSTRY FOR THE FAINT OF HEART OR FOR THOSE WHO FEEL HALF-HEARTEDLY ABOUT THE MISSION WE SHARE. YOU INVEST HUGE SUMS OF MONEY ON AN IDEA THAT WILL TAKE YEARS TO DEVELOP AND MAY NEVER MAKE IT TO MARKET. AND YET YOU DO IT BECAUSE THE UPSIDE DEFIES DESCRIPTION. ALZHEIMER’S, AIDS, HEART DISEASE, CANCER – WE ARE MAKING BREAKTHROUGHS ON EVERY HUMAN MALADY YOU CAN NAME. AND THAT MAKES THE BILLIONS OF DOLLARS OF INVESTMENT ENTIRELY WORTHWHILE.
BUT, IT’S NOT A QUESTION OF WHAT I BELIEVE, OR WHAT YOU BELIEVE. IT’S WHAT THE PEOPLE WHO MAKE OUR LAWS AND SET OUR POLICY BELIEVE THAT REALLY MATTERS. YOU SEE, THERE IS A DIRECT CORRELATION BETWEEN THE FREE MARKET AND THE ABILITY TO DEVELOP NEW LIFESAVING MEDICINES. RESEARCH FLOURISHES WHEN THE MARKET ALLOWS DOLLARS TO FLOW INTO LABORATORIES. RESEARCH LANGUISHES WHEN GOVERNMENT CHOOSES TO ALTER THE FREE MARKET PARADIGM.
THERE IS NO BETTER PRIMA FACIE EXAMPLE OF THIS AXIOM THAN EUROPE. NOT ALL THAT LONG AGO, THE EUROPEAN CONTINENT WAS THE HOME OF MOST PHARMACEUTICAL INNOVATION. IN 1990, THE LEVEL OF PHARMACEUTICAL RESEARCH IN THE UNITED STATES WAS ONLY 70 PERCENT OF THAT TAKING PLACE IN EUROPE.
TODAY, THE ROLES ARE REVERSED – AND THEN SOME. IT IS NOT AN ACCIDENT THAT MORE THAN 80 PERCENT OF THE WORLD’S NEW DRUG DEVELOPMENT OCCURS IN THE UNITED STATES.
YOU CAN ANALYZE THIS FROM EVERY DIRECTION, BUT THERE IS SIMPLY ONE INESCAPABLE REASON THAT PHARMACEUTICAL DEVELOPMENT IS TAKING PLACE IN LOCALES LIKE MASSACHUSETTS, NEW JERSEY AND NORTH CAROLINA INSTEAD OF FRANCE OR ENGLAND OR GERMANY. THE EUROPEAN COUNTRIES MADE PRICE CONTROLS A CENTRAL COMPONENT OF THEIR ECONOMIC POLICY,
AND IN A HEAD-TO-HEAD COMPARISON WITH THE UNITED STATES FREE MARKET ENVIRONMENT, IT’S A NO-BRAINER OF A COMPARISON. EUROPE IS AS LARGE A MARKET AS THE UNITED STATES. EUROPEANS ARE NO LESS IN NEED OF DRUGS THAN AMERICANS. BUT, HEAVY-HANDED PRICE CONTROLS HAVE MADE EUROPE AN INHOSPITABLE ENVIRONMENT FOR INNOVATION.
AND PEOPLE IN EUROPE AND IN CANADA CAN TELL YOU THE CONSEQUENCE OF PHARMACEUTICAL INNOVATION CENTERING IN THE UNITED STATES. ON ONE HAND, THERE IS AN ECONOMIC IMPACT. THE PHARMACEUTICAL AND BIOTECH INDUSTRIES HAVE ENORMOUS, UNLIMITED POTENTIAL. THEY ARE A BOON TO ANY ECONOMY. EUROPE, BY VIRTUE OF ITS PRICE CONTROLS, HAS ELECTED TO MISS OUT ON THAT ECONOMIC STIMULUS.
BUT THERE’S A HUMAN IMPACT AS WELL. WHEN APPROVED DRUGS GO ON THE MARKET, AMERICAN CONSUMERS CAN HAVE THEM IMMEDIATELY. EUROPEANS MUST WAIT, SOMETIMES FOR YEARS, FOR GOVERNMENTS TO NEGOTIATE PRICES WITH MANUFACTURERS AND DETERMINE WHERE THE PRICE CEILINGS WILL BE SET.
INTERESTINGLY, EUROPE IS REALIZING THAT IT MAY NEED TO CHANGE DIRECTIONS. TWO MONTHS AGO, THE EUROPEAN UNION ISSUED A STATEMENT THAT A DYNAMIC PHARMACEUTICAL INDUSTRY IS CRITICAL IN MEETING THE ECONOMIC, SOCIAL AND PUBLIC HEALTH GOALS OF THE EU. AND, A HIGH-LEVEL WORKING GROUP, CALLED THE G10, HAS RECOMMENDED THAT EUROPE EMBRACE OPEN AND COMPETITIVE MARKETS. PRICE CONTROLS, THEY SAY, SHOULD BE LIMITED TO THOSE MEDICINES PURCHASED OR REIMBURSED BY THE STATE.
FACED WITH A FUNDAMENTAL CHOICE, EUROPE HAS LEARNED BY HARD EXPERIENCE THAT FREE MARKETS AND PHARMACEUTICAL AND BIOTECH INNOVATION ARE SYNONYMOUS. IT WOULD SEEM THEY HAVE LOOKED TO THE AMERICAN EXPERIENCE, TO THE AMERICAN SUCCESS IN ATTRACTING AND GENERATING PHARMACEUTICAL AND BIOSCIENCE INDUSTRY, AND THEY ARE GRADUALLY MOVING TO ABANDON A FAILING POLICY IN FAVOR OF ONE THAT HAS PROVEN SUCCESSFUL.
AND THAT BEGS THE QUESTION, WHY WOULD THE UNITED STATES, WHY WOULD THE STATE OF OHIO, WANT TO MOVE IN THE OPPOSITE DIRECTION?
PRICE CONTROL ADVOCATES WILL TELL YOU THAT WE ABSOLUTELY HAVE TO DO SOMETHING ABOUT COSTS. WE ABSOLUTELY HAVE TO MAKE DRUGS MORE ACCESSIBLE FOR THE PEOPLE WHO CAN’T AFFORD THEM TODAY.
LET’S BRIEFLY EXAMINE THIS ISSUE OF COST, BECAUSE THERE ARE SOME MISCONCEPTIONS TAKING HOLD IN PUBLIC DISCOURSE THAT NEED TO BE ADDRESSED.
THERE IS THIS AXIOM OUT THERE RIGHT NOW THAT PRESCRIPTION DRUGS ARE THE DRIVERS THAT ARE CAUSING HEALTH CARE COSTS TO ESCALATE OUT OF CONTROL. THERE IS NO QUESTION, OF COURSE, THAT WE, AS A PEOPLE, ARE SPENDING MORE ON PHARMACEUTICAL PRODUCTS. AS NEW MIRACLE DRUGS HAVE ENTERED THE MARKETPLACE, MORE PEOPLE ARE TAKING THOSE MEDICINES TO STAY HEALTHY. USAGE IS UP, AND THEREFORE CUMULATIVE SPENDING IS UP.
LET’S LOOK, THOUGH, AT WHAT’S REALLY HAPPENING WITH PATIENTS AND HEALTH CARE CONSUMERS. A COLUMBIA UNIVERSITY STUDY HAS SHOWN THAT, FOR EVERY DOLLAR SPENT ON PRESCRIPTION DRUGS, WE’RE SAVING $6.17 IN OVERALL HEALTH CARE COSTS. THAT MEANS THAT PHARMACEUTICAL INNOVATION HAS FUNDAMENTALLY CHANGED THE FACE OF HEALTH CARE IN THIS COUNTRY. INSTEAD OF SPENDING AS MUCH MONEY ON HOSPITAL BEDS, ON REPEATED TRIPS TO THE DOCTOR, ON TREATMENT IN EMERGENCY ROOMS, WE ARE INSTEAD USING MEDICINES THAT KEEP US OUT OF THE HOSPITAL.
TODAY, INSTEAD OF SPENDING MONEY TO TREAT EPISODES OF ILLNESS, WE ARE INSTEAD SPENDING DOLLARS ON EFFORTS TO MANAGE DISEASE AND PROMOTE BETTER HEALTH.
WITHOUT THE RECENT PHARMACEUTICAL ADVANCES AND THE ASSOCIATED COST-SAVINGS, OVERALL MEDICAL EXPENDITURES WOULD BE EVEN GREATER. THAT IS A DAUNTING THOUGHT FOR MOST PATIENTS, EMPLOYERS AND THE GOVERNMENT… WE COULD ALL BE PAYING EVEN MORE FOR HEALTH CARE IF PRESCRIPTION DRUGS WERE NOT CREATING SAVINGS IN THE OVERALL SYSTEM.
SO, WE ENJOY A HIGHER QUALITY OF HEALTH TODAY IN AMERICA AND, CONTRARY TO POPULAR RHETORIC, WE ARE NOT SPENDING A GREAT DEAL MORE TO ATTAIN IT. IN 1960, 10 CENTS OF EVERY HEALTH CARE DOLLAR WAS SPENT ON PRESCRIPTION DRUGS. TODAY, DRUGS ACCOUNT FOR NINE PERCENT OF ALL HEALTH CARE SPENDING.
ALL OF THESE FACTS NEED TO BE TAKEN INTO CONSIDERATION BY FEDERAL AND STATE POLICYMAKERS WHEN THEY MAKE THEIR FUNDAMENTAL CHOICES.
YES, THERE IS A SOCIAL OBLIGATION TO HELP LOW-INCOME PEOPLE, PEOPLE WITHOUT HEALTH INSURANCE, THE ELDERLY WITHOUT MEDIGAP POLICIES TO GET ACCESS TO PRESCRIPTION MEDICINES. BUT ARE PRICE CONTROLS – AN APPROACH THAT CARRIES TREMENDOUS NEGATIVE CONSEQUENCES, AS OUR EUROPEAN BRETHREN KNOW ALL TOO WELL – THE ONLY ANSWER?
THERE ARE BETTER, WISER ALTERNATIVES. ONE IS IN EFFECT RIGHT HERE IN OHIO. JUST THIS YEAR, HOSPITALS, PATIENT GROUPS, DOCTORS, PHARMACEUTICAL COMPANIES AND OTHER HEALTH CARE ORGANIZATIONS JOINED TOGETHER TO LAUNCH RX-FOR-OHIO. THIS IS A PROGRAM THAT BRINGS TOGETHER 325 DIFFERENT PROGRAMS TO HELP PEOPLE RECEIVE THE MEDICINES THEY NEED. BY CALLING 1-877-RX-4-OHIO OR BY LOGGING ONTO WWW.RXFOROHIO.ORG, ANYONE CAN FIND OUT THEIR ELIGIBILITY FOR ANY OF THESE PROGRAMS.
SINCE RX-FOR-OHIO WAS LAUNCHED ON APRIL 28, OVER 300,000 OHIOANS HAVE QUALIFIED FOR HELP FROM A PROGRAM THAT OFFERS ACCESS TO MORE THAN 1,400 BRAND NAME PRESCRIPTION DRUGS AT LOW COST OR EVEN NO COST.
BUT PROGRAMS LIKE THIS, AS EFFECTIVE AND VALUABLE AS THEY MAY BE, ARE JUST STOPGAP MEASURES TO HELP OUT UNTIL GOVERNMENT STEPS IN WITH REAL SOLUTIONS TO MAKE PRESCRIPTION DRUGS MORE ACCESSIBLE. SOLUTIONS LIKE A PRESCRIPTION DRUG BENEFIT FOR MEDICARE BENEFICIARIES. SOLUTIONS LIKE MAKING HEALTH INSURANCE MORE ACCESSIBLE TO LOW-INCOME WORKING PEOPLE WHO DON’T HAVE COVERAGE.
IT’S OFTEN SAID THAT THE UNITED STATES HAS THE BEST HEALTH CARE SYSTEM IN THE WORLD. I BELIEVE THAT TO BE TRUE, BUT I BELIEVE WE ALSO HAVE SOME IMPROVING TO DO. CERTAINLY WE NEED TO CLOSE THE GAP BETWEEN OUR ABILITY TO CREATE SCIENTIFIC MIRACLES IN MEDICINE AND OUR ABILITY TO DELIVER THOSE MIRACLES TO ALL WHO NEED THEM. BUT, GOVERNMENTS, BOTH STATE AND LOCAL, SHOULD NOT MAKE THE MISTAKE OF THINKING THEY CAN MAKE THOSE MIRACLES MORE ACCESSIBLE WHILE, AT THE SAME TIME, CHOKING OFF THE RESOURCES NECESSARY TO CREATE THEM.
YES, GOVERNMENTS HAVE CHOICES TO MAKE. BUT, SO DO WE IN THE PHARMACEUTICAL AND BIOSCIENCE INDUSTRIES.
IF WE TRULY BELIEVE IN THE VALUE OF THE FREE MARKET IN MAKING RESEARCH AND INNOVATION POSSIBLE, THEN WE NEED TO MAKE OUR VIEWS KNOWN THROUGH OUR WORDS AND, MORE IMPORTANTLY, THROUGH OUR ACTIONS.
THE WALL STREET JOURNAL DID A PIECE LAST YEAR ON NOVARTIS SHIFTING ITS GLOBAL RESEARCH HEADQUARTERS FROM EUROPE TO CAMBRIDGE, MASSACHUSETTS. THE JOURNAL STORY INCLUDED A SENTENCE THAT, I BELIEVE, GOES RIGHT TO THE HEART OF THE MATTER THAT AFFECTS US ALL. THEY WROTE, “COMMUNITIES OF RESEARCH EXCELLENCE TEND TO SPRING UP IN ENVIRONMENTS LIKELY TO REWARD INNOVATION.”
AS WE DETERMINE WHERE TO BUILD OUR COMMUNITIES OF EXCELLENCE, WE NEED TO CONCENTRATE ON THOSE JURISDICTIONS THAT UNDERSTAND THE VALUE OF INNOVATION, THAT UNDERSTAND WHAT IS NECESSARY TO SUSTAIN QUALITY RESEARCH, THAT UNDERSTAND THE VITAL LINKAGE BETWEEN THE MARKETPLACE AND SCIENTIFIC BREAKTHROUGHS.
IF OHIO PURSUES GOVERNOR TAFT’S VISION EMBODIED IN HIS THIRD FRONTIER INITIATIVE, THEN THIS STATE WILL INDEED BE VIEWED AS A HAVEN OF INNOVATION AND EXCELLENCE, AND IT WILL EARN THE CONFIDENCE AND THE INVESTMENT OF RESEARCH-BASED COMPANIES. IF, HOWEVER, THE LEGISLATURE MOVES IN THE DIRECTION OF PRICE CONTROLS, OR THE WAY IS CLEARED FOR A BALLOT INITIATIVE THAT UNDERMINES RESEARCH AND DEVELOPMENT, THEN OHIO WILL BE SENDING AN ENTIRELY DIFFERENT MESSAGE, ONE THAT CARRIES FAR-REACHING AND LONG-TERM EFFECTS.
I AM VERY CONFIDENT THAT THIS STATE WILL CHOOSE THE RIGHT DIRECTION, AND THAT THE MEMBERS OF OMERIS WILL HELP OHIO MAKE THE RIGHT CHOICES.
PRESIDENT JOHN F. KENNEDY ONCE SAID, “MEN MAY DIE, NATIONS MAY RISE AND FALL, BUT AN IDEA LIVES ON.” BECAUSE OF ALL OF YOU AND OTHERS LIKE YOU, NEW IDEAS WILL CONTINUE TO BE BORN, TO FLOURISH AND TO LIVE ON, AND PEOPLE WILL BENEFIT FROM THEM. LET US WORK TOGETHER TO MAKE OUR NATION AND THIS STATE A HOMELAND FOR IDEAS THAT EXCEED THE LIMITS OF THE POSSIBLE AND ACHIEVE THE UNIMAGINABLE. THANK YOU VERY MUCH.
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