Ebola and the FDA

by on August 5, 2014 at 7:20 am in Economics, Medicine | Permalink

The Telegraph reports:

The two American doctors who have caught Ebola have been treated with a new “secret serum” which could potentially save their lives.

…A source close to the Atlanta hospital, where Dr Brantly is being treated, told CNN: “Within an hour of receiving the medication, Brantly’s condition was nearly reversed. His breathing improved; the rash over his trunk faded away.”

One of his doctors reportedly described the events as “miraculous.”

…Dr Writebol was also administrated with the drug, which was transported to Liberia in a special sub-zero container. She showed a less remarkable recovery, but is hoped to travel to the US on Tuesday to continue her treatment.

According to CNN, the drug was developed by the biotech firm Mapp Biopharmaceutical, based in California. The patients were told that this treatment had never been tried before in a human being but had shown promise in small experiments with monkeys.

…health workers said drugs that could fight Ebola are not particularly complicated but pharmaceutical firms see no economic reason to invest in making them because the virus’ few victims are poor Africans.

Of course, pharmaceutical firms are not going to invest millions in getting a drug through FDA trials for a disease that has only killed a few thousand people since being discovered in 1976. Nevertheless, some people find this simple logic difficult to accept.

 Prof John Ashton, Britain’s leading public health doctor, termed the “moral bankruptcy” of profit-driven drugs developers.

The logic of profit-driven drug developers is no different than the logic of profit driving automobile manufactures. It isn’t profitable to make cars for people who can’t afford them but the auto firms are rarely called morally bankrupt for not giving cars away to the poor. Moreover, it’s not at all obvious why the burden of producing unprofitable drugs should fall on the drug manufacturers. To the extent that there is an ethical case for developing drugs for the poor it’s a burden that falls on all of us.

As Eric Crampton notes there are at least two possible solutions. Either ensure at taxpayer expense a return on investment by subsidizing, offering prizes (as I suggested in Launching) or publicly investing in orphan drugs or

ease up the FDA trials for drugs in this kind of category. Does it really make sense to mandate placebo trials for drugs hitting diseases with 60% fatality rates? We are condemning people to a very high risk of death for the sake of ensuring that there aren’t drug side effects and that the drugs are more effective than placebos (pretty easy to tell quickly where the fatality rate is otherwise 60%!).

charlie August 5, 2014 at 7:22 am

Hmm, more pharma stock promoters around?

And nothing about the military funding this research? Tsk tsk.

andrew' August 5, 2014 at 8:16 am

The military doesn’t fund anything.

ivvenalis August 5, 2014 at 8:28 am

The military administers vaccines and prophylactic drugs en masse to soldiers against region-specific infectious diseases and possible biological warfare agents on a routine basis and maintains stocks of chemical warfare agent antidotes, in addition to all sorts of standard medical material for its own internal health system. They also conduct research at e.g. USAMRIID. I assume, at some point, they pay for these things or, if you want to be pedantic about it, ask for and generally receive money to be allotted by Congress for this purpose.

Andrew' August 5, 2014 at 8:43 am

It is not pedantic. It is central to the point I think Charlie is trying to insinuate.

In fact, if the development of the antidote is part of a weapons program, the truth might be the opposite of what Charlie seems to be trying to insinuate.

Andrew' August 5, 2014 at 8:44 am

See below the comment about resources being directed away from cancer toward Ebola.

An Ebola vaccine is likely only utilitarian if there is a natural or man-made pandemic.

So far, all it has done is probably caused us to import Ebola to our shores.

Pedantic?

ivvenalis August 5, 2014 at 9:01 am

Charlie implied the drug was developed as a result of military research into likely biological weapons. It’s circumstantially likely and he’s gone ahead and shown some more evidence below. I don’t see how “the Department of Defense spends money researching drugs to counteract biological weapons” is any different than “the Department of Defense asks Congress for money to spend on research, they’re given the money, then they spend it” or changes anything about Charlie’s statement.

Unless he’s trying to say that the military asks for money for one reason, then secretly spends it on developing Ebola bombs and as a side effect discovers counteracting drugs, but I’m going to assume good faith here.

Andrew' August 5, 2014 at 1:43 pm

The military allocates the funding provided them. Sometimes in bizarre ways. As a public goods investment, and as a national defense function, using a lot of money for ebola is debatable at best.

I am glad we get something. But I’m not going to lead the parade.

charlie August 5, 2014 at 8:47 am

“The product first described yesterday by CNN is the result of a convoluted convergence of U.S. and Canadian federal agencies and industrial partners that’s typical for treatments of potential value against biowarfare and bioterrorism.

As with other companies working on small molecules and biologicals against Ebola and other hemorrhagic fever viruses, MappBio was the beneficiary of grants and contracts from federal agencies that include the National Institute of Allergy and Infectious Disease (NIAID), the Department of Defense Advanced Research Projects (DARPA), and the Defense Threat Reduction Agency (DTRA).

The U.S. Army Medical Research Institute of Infectious Diseases (USAMRIID) has been a critical driver of much of this work as they maintain biosafety level-4 facilities in Frederick, Maryland, an have extensive expertise with non-human primates as a model for human infectious diseases.”

prior_approval August 5, 2014 at 9:44 am

‘The military doesn’t fund anything.’

Admiral Crowe (ret.) would disagree – ‘He also served on the board of Emergent BioSolutions (then Bioport), a company that provided controversial anthrax vaccinations to the U.S. military in the 1990s. The deal was approved by the Clinton administration, with which Crowe had a previous relationship’ http://en.wikipedia.org/wiki/William_J._Crowe#Later_life_and_death

Jay August 5, 2014 at 7:27 am

If you read enough of the garbage spewed by Proggers you realize they believe that negative events should NEVER happen. That means reducing something to a six sigma event is insufficient “Progress” for Proggers. They demand you spend trillions of dollars to ensure that the P(negative event) = 0%, which is logically impossible to reach but has never stopped Proggers from spending other people’s money trying.

dead serious August 5, 2014 at 7:46 am

People like you will be the first in line to sue when your kid/wife/parent is diagnosed with liver cancer due to some not-well-tested drug.

Right-wingers are the worst kind of insufferable hypocrite.

andrew' August 5, 2014 at 8:18 am

Not if we legalize organ sales, for which livers may work well because they have regeneration ability.

Slappy McFee August 5, 2014 at 9:19 am

Interesting theory. Does FDA approval provide immunity against lawsuits?

Andrew' August 5, 2014 at 1:47 pm

I wonder if they ensure safety.

I’d be up for informed consent for fast-track drugs where you sign away known drug risks.

dead serious August 5, 2014 at 2:26 pm

I agree, but would prefer a “life-saving” qualifier.

Andrew' August 5, 2014 at 2:43 pm

You had me at Ebola

Careless August 5, 2014 at 6:59 pm

No.

Explodicle August 6, 2014 at 8:12 am

I must be too far gone because I honestly can’t see how that’s hypocritical. Why wouldn’t one sign away their right to sue for untested side effects of Ebola drugs?

What kind of person would kill thousands of Africans to prevent a handful of frivolous lawsuits?

mofo. August 5, 2014 at 8:46 am

Fundamentally, proggers dont understand opportunity cost. They dont understand that the cost of researching an Ebola cure is not researching a cure for something else. So to them, the only reason why no one researches a cure for X disease is that you dont care about the people who suffer for it. That, or like dead serious, they have a strong desire to feel morally superior to you and dont think beyond that.

dead serious August 5, 2014 at 8:59 am

Swing and a miss.

Dude is giving his best anti-FDA screed (to which my response is directed) and you’re spewing econ 101 principles.

TMC August 5, 2014 at 11:20 am

“econ 101 principles.”

a. Occam’s Razor.
b. So you could understand… Maybe.. Probably not.

China Cat August 5, 2014 at 11:43 am

That you are smug is now taught in econ 101?

Jan August 5, 2014 at 9:05 am

Or the cost is allowing the federal government to negotiate drug prices, just like every other country in the world does, which conservatives can’t bring themselves to do. To conservatives, the reason we shouldn’t do this is a principle that the free market will lower prices, and they have deluded themselves into thinking that health care and drugs are free market goods. They take this principled stand against something that would save us tens of billions of dollars per year while we subsidize the rest of the world’s drug development costs. They can’t see beyond their own idealized free market utopia, so they end up skipping reality. Either that or they are the drug companies’ last friends, so feel compelled to keep giving them sweetheart deals on US taxpayer markets.

Dan Weber August 5, 2014 at 9:24 am

Many individual American insurance companies have larger insurance rolls than entire European countries. If it was just “negotiating power” they would have lower prices than Europe. But what they don’t have is the capacity to violate property rights.

prior_approval August 5, 2014 at 10:20 am

The property rights you are talking about are granted and enforced by governments.

And can be taken away at need – see the response to possible terrorism involving anthrax –

‘But now we are seeing a downside of one company having control over a particularly lucrative drug. On NBC’s Today show Oct. 17, Health and Human Services Secretary Tommy G. Thompson Tommy G. Thompson said the U.S. government is nudging German drug and chemical giant Bayer to relax the patent on Cipro, an antibiotic that is commonly used to treat anthrax.

As soon as the first cases of anthrax resulting from suspicious mail occurred, there were wide reports of a run on the drug.

……………

That has meant increased demand for Cipro. Leverkusen, Germany-based Bayer has increased production by 25% at factories in America and Germany to make sure there is no shortage of the drug. The company says it is prepared to ship 15 million tablets of Cipro a week for the next three months. “Right now we really can’t comment on the generic component of this,” says Bayer director of communications Ellena Friedman. “At this point, we’ve been able to fill the orders, and we’ve been able to fulfill the need of the requests that have been made.”

Bayer has reason to be eager about filling the demand. Cipro has been a blockbuster drug for Bayer, with $1 billion in U.S. sales last year.

…………………………….

But Cipro was set to lose its patent protection in 2003. According to Reuters, there are at least 78 Indian generic drugmakers who already produce the antibiotic but cannot sell it in America until that time. Dr. Reddy’s Laboratories has already applied with the Food and Drug Administration to sell the drug in the U.S. when Bayer’s patent expires, and other drugmakers in India, like Cipla and Ranbaxy Labs, might jump at the chance to meet U.S. supply needs. In India, where patent laws are different, ciprofloxacin costs one-thirtieth of what it does in the U.S.–competition between all the companies making the drug has driven down the price.’ http://www.forbes.com/2001/10/17/1017cipro.html

Luckily, the author of the article concludes so – ‘Unfortunately, in order to get cheap ciproflaxacin from India, the U.S. would have to find a way to circumvent the same patent laws that have given us very expensive but life-saving drugs ranging from Novartis cancer drug Gleevec to Merck‘s cholesterol-fighting drug Zocor. As elsewhere, it is important not to damage the U.S. system with overly far-reaching emergency measures.

If Bayer can indeed meet demand, the U.S. may be best off sticking to the tried and true.’

And some people wonder why the U.S. is the source of such fat profits for companies like Bayer AG – for pharmaceutical companies, making huge profits in America is just business as usual. And Forbes, for one example of a capitalist tool, would be unlikely to support any change to that extremely profitable structure.

Jan August 5, 2014 at 1:09 pm

No, they follow what Medicare does. If you don’t have the threat of not covering a drug then you have no negotiating clout. These companies all follow Medicare, which covers everything so there is no threat and only minimal discounts.

Also negotiated prices are only one piece it. Many countries have actual price controls.

Cliff August 6, 2014 at 3:33 pm

Nobody thinks that not negotiating drug prices at a federal level leads to lower prices. How could it, when the government can just dictate whatever price it wants? People do not want to do it because it would very negatively affect drug development.

Alexei Sadeski August 5, 2014 at 9:09 am

In the Workers Paradise, all vaccines will be researched all of the time! And they will be made free to every human in the world!

Opportunity cost is nothing but capitalist propaganda.

Dave Anthony August 5, 2014 at 9:27 am

“they have a strong desire to feel morally superior to you and dont think beyond that”

That is the majority of it — which explains their obsession with privilege and acting like they care about poor people while implementing policies that keep them poor and dependent on government welfare. They care only about intent, and not much for actual outcomes.

Hazel Meade August 5, 2014 at 10:02 am

To be fair, it’s completely subconscious.
I don’t think they realize how much their sanctimonious moralizing resembles the batty religiosity of church-ladies of the early 20th century.
There must be some deep psychological need that is served by religion, which secular progressives can’t satisfy except by excorciating people about profits and GMOs and vegetarianism.
Personally, I don’t really get it.

dead serious August 5, 2014 at 10:51 am

You’re just not very smart. It’s okay.

mofo. August 5, 2014 at 11:00 am

Oh schnap! He just called you a big dummy head. BURN!

Yancey Ward August 5, 2014 at 11:11 am

I agree, it is subconscious. For all intents and purposes, it is religious fervor and without any characteristics that really distinguish it from what one might have seen 200 years ago. I don’t know if it is hard-wired into some people, or is a result of nurture- I have seen enough of the purely religious variety to think it might be some sort of organic mental aberration. However, the passionate intensity is always disconcerting.

dead serious August 5, 2014 at 11:42 am

Look at all the wingnuts beating up that straw man. Impressive what a lather you guys can self-create.

mpowell August 5, 2014 at 12:17 pm

It’s true that there are a lot of idiot progressives out there. There are a lot of idiotic libertarians too. In the defense of progressives I will point out that at least they mostly appear to be motivated by helping poor people and the broader public. I wouldn’t really agree that is true as often with libertarians. But trying to paint entire movements with such a broad brush is not really that useful. There are lots of different people with lots of different motivations and perspectives in any movement. On the other hand, I think that segmentation that has developed in the blogging world over the past decade or so has encouraged the kind of group think that is driving more uniform thinking within sub groups and primarily in the left-right divide. It is unfortunate.

Careless August 5, 2014 at 7:05 pm

That’s not at all what a “straw man” is, DS. But you’re so smart, you must have known that.

Nyongesa August 6, 2014 at 2:45 am

Well said Mpowell… much respect. The lack of skepticism in one’s own opinion is my canary in any comment section. The moment short hand put downs such as progger or wingnut start flying around, i start quaking in my mouse boots. The increasing tendency to cajole and bully others for in-group, out-group corralling has become problem on the site. Skepticism of ones own opinions is sorely, sorely….SORELY needed by western populations to match it’s overabundance towards everyone else.

Kevin C. August 6, 2014 at 12:22 am

“They care only about intent, and not much for actual outcomes.”

In other words, sola fide, yes?

Jay August 5, 2014 at 12:32 pm

Proggers don’t care about opportunity cost because they believe that they can butt rape (tax) the Koch brothers enough for the government to solve all the world’s problems.

Rich Berger August 5, 2014 at 1:39 pm

This is as close as Tyler gets to outrage. Here we have an eminent British physician who does not understand the necessity that a drug company make a profit to stay in business and attract investment. For him, profit is a bad word and the company should produce drugs at a loss. Good luck with that!

Given that a smart fellow like Ashton maintains this folk belief, it is not surprising that some of the less sophisticated commenters here hold similar views. This folk belief is really based on ignorance of the fundamentals of economics.

Thomas August 5, 2014 at 6:47 pm

Caplan demonstrated this in “The Myth of the Rational Voter”.

Pshrnk August 5, 2014 at 4:42 pm

Sooo many diseases i have not researched and developed cures for. Obviously I don’t care and will go to hell.

Willitts August 5, 2014 at 12:52 pm

They are obviously not paying enough in taxes and charity.

mb August 5, 2014 at 7:30 am

I would add profit seeking professors, like Prof John Ashton, that stay in their comfortable home country while poor uneducated Africans languish.

dearieme August 5, 2014 at 8:12 am

“Prof John Ashton, Britain’s leading public health doctor, termed the “moral bankruptcy” of profit-driven drugs developers.” I am confident that Ashton lives his life poor as a church mouse, diverting all his salary and consulting fees to the poor. Else he’s a hypocritical bastard.

Eric s. August 5, 2014 at 7:59 am

Moral bankruptcy – F-that. Cancer, alzheimer’s, and HIV cause a whole lot more human misery than Ebola. Who does Mapp think they are devoting precious resources to Ebola vaccines? Seriously.

ivvenalis August 5, 2014 at 8:35 am

Not that you don’t have a point but, on the other hand, cancer and Alzheimer’s (and a lot of other common causes of non-traumatic death) mostly affect people who are going to die soon one way or the other anyway, and HIV has turned out to be a bit of a bust. Yeah, Ebola’s a pretty rare disease now, but if it turns in to the Red Death, it’s going to do a lot more damage than a bunch of people dying of cancer instead of heart disease. Ebola is much more lethal than AIDS, and at least appears to be much more contagious, so it’s a bit silly to wait until it gets out of control to start developing drugs.

mofo. August 5, 2014 at 8:48 am

Ill bet more people die from childhood cancer each year than have ever died from Ebola.

dead serious August 5, 2014 at 9:01 am

Everyone stop what you’re doing and start working on solving this childhood cancer menace.

Because opportunity cost.

mofo. August 5, 2014 at 9:20 am

Everyone stop what you’re doing and start working on solving Ebola because that is what the left momentarily pretending to care about today.

Jan August 5, 2014 at 9:06 am

We should compare the incidence of childhood cancer and funding for its research with that of ebola. Which do you think gets proportionally more funding?

Dave Anthony August 5, 2014 at 9:30 am

The one that people care more about — childhood cancer. So what?

Jan August 5, 2014 at 1:12 pm

So I demolished the previous commenters argument. That’s all.

Andrew' August 5, 2014 at 6:17 pm

In the absence of distortion, I would not be concerned. But do we have distortion.

If one is going to claim credit for military allocating funding to a success they also must acknowledge the opportunity cost.

Exactly how the ledger adds up I don’t know.

JustSomeGuy August 5, 2014 at 9:40 am

yes, but cancer is not contagious, and one kid going to school with cancer is not going to spread the disease and cause the death of the entire town.

Pshrnk August 5, 2014 at 4:44 pm

Are you sure there are no contagious cancers?

Andrew' August 5, 2014 at 6:18 pm

Ebola might not harm the school, unless the first world treatment center is located in the town, then it might.

Brian Donohue August 5, 2014 at 10:53 am

But but but….diseases that kill quickly are unlikely to develop into epidemics. Smart pathogens know better- they keep hosts alive long enough to spread effectively.

Boonton August 5, 2014 at 11:26 am

We are acting on faith then that the ebola pathogen won’t ‘get smarter’?

Brian Donohue August 5, 2014 at 11:32 am

The Precautionary Principle- is there anything it can’t do, especially in a world of unlimited resources where no choices ever have to be made?

Also, ‘smarter’ means less immediately lethal, by definition. What freaks people out the most about Ebola is the same thing that means it won’t spread rapidly.

Mo August 5, 2014 at 1:08 pm

Ebola is already “getting smarter”. Ebola has already gotten less immediately lethal than it was before. That’s the problem with this current outbreak. It’s one of the least lethal ebola outbreaks on record.

albatross August 5, 2014 at 1:28 pm

AIDS has managed to kill a hell of a lot of people. It’s not so scary in the US anymore (unless you’re a gay man, in which case you should still be pretty worried) because it doesn’t seem to spread well among heterosexual Europeans living in first-world conditions, but it looks to be able to spread just fine in a lot of Africa.

Michael Foody August 5, 2014 at 8:10 am

It’s not an indictment of the pharma firms per se, but it might be an indictment of relying so overwhelming on assigning property rights to ideas to generate artificial scarcity to incentivize innovation. It might be worth evaluating whether publicly funded open source medical research should be a bigger part of the pie than privately funded research. Markets are great at managing scarcity, but they might not be so great that it is worth introducing scarcity just to use them.

Dan Weber August 5, 2014 at 8:14 am

Do you have any evidence that property rights retarded others’ efforts to make this drug?

Yancey Ward August 5, 2014 at 11:17 am

Having worked in the field, one advantage of the private model that I can note is that it eventually gives up on dead ends because they are losing money. I can imagine that after 30 years or so, you would end up with a public system of drug research with dead weight that could never be cut off, and would never be successful no matter how much money you continued to throw at it.

China Cat August 5, 2014 at 11:49 am

Nice point. Like Head Start.

Pshrnk August 5, 2014 at 4:45 pm

I can’t wait for fusion power.

Andrew' August 5, 2014 at 6:19 pm

If you want fusion power, go download some Stanley Clarke.

dearieme August 5, 2014 at 8:12 am

Why the lunacy of flying the patient to the drug rather than vice versa?

Dan Weber August 5, 2014 at 8:17 am

Because they had no idea if it would work, and in any case you would want him in America so he could receive first-world medical treatment.

Now that they had some data it works, as the quoted portion said, they are moving some quantity of the drug to Liberia.

Bob Knaus August 5, 2014 at 8:19 am

The drugs were flown to Africa to stabilize the patients so they could be transported to the US. It’s in the article…

Alexei Sadeski August 5, 2014 at 9:11 am

PR?

Yancey Ward August 5, 2014 at 11:21 am

Maybe it was a bit of PR, but as far as I can tell from the stories, the costs are being picked up by the charitable organization that employs them. Since they are US citizens, I don’t really have a problem bringing them back to the US for the best treatment, even if the costs had to be picked up by the US government.

In any case, Ebola was already past the border since research on the virus is being conducted in the US.

Mo August 5, 2014 at 1:09 pm

Ebola isn’t airborne. If you properly quarantine the patient and avoid sharing bodily fluids, the disease won’t spread.

Jamie_NYC August 5, 2014 at 5:02 pm

Then how did the two doctors get infected? Did they drink blood or something?

Explodicle August 6, 2014 at 8:18 am

Probably accidental needle sticks, not using gloves, someone spat in the air, etc…

Alan August 5, 2014 at 8:16 am

Today I learned that convenient transport and staying alive are morally equivalent.

Benny Lava August 5, 2014 at 8:24 am

Yes that is the interesting moral calculus Alex makes. Buying a car = buying a lifesaving drug. I often accused libertarians of making this moral calculus and they always denied it. Good to see Alex finally make the case. If you can’t afford it then you deserve to die. What’s a few thousand people?

ivvenalis August 5, 2014 at 8:38 am

Obviously there is no tradeoff or upper limit to expenditure when keeping someone alive, because individual human lives are infinitely valuable. If I require a new liver, heart, and kidney every six months to keep me alive, well then you’re a bad person if you don’t give them to me for free.

Alexei Sadeski August 5, 2014 at 9:12 am

In Communist America, no one will die.

Alexei Sadeski August 5, 2014 at 9:12 am

…unless they are in the 1%!

prior_approval August 5, 2014 at 9:37 am

Please – in God fearing America, no one will ever be allowed to die, though in today’s secular humanist America hell, death remains possible, if one works hard enough at it – ‘In all, the Schiavo case involved 14 appeals and numerous motions, petitions, and hearings in the Florida courts; five suits in federal district court; Florida legislation struck down by the Supreme Court of Florida; federal legislation (the Palm Sunday Compromise); and four denials of certiorari from the Supreme Court of the United States.[3] The case also spurred highly visible activism from the pro-life movement and disability rights groups.’ http://en.wikipedia.org/wiki/Terri_Schiavo_case

Dave Anthony August 5, 2014 at 9:32 am

I wish there was a like button for this.

Jim Nazium August 5, 2014 at 9:51 am

Thank you.

Jim Nazium August 5, 2014 at 9:55 am

Also, remember that health care is a right, not a privilege. If you think that medical treatment is a limited resource, and that prices convey useful information about how society wants to allocate those scarce resources, then you don’t care about sick people.

Benny Lava August 5, 2014 at 10:45 am

Obviously this communist nonsense about helping people is piffle. The most efficient solution is for a few wealthy people to buy up all the medine and horde them so that the unproductive parasite of poverty will naturally die off. The market solution is for poor people to die off since they don’t deserve medicine, that is only for the makers of society. Charity is an enabler that perverts society, and human life definitely has a dollar value. For most that value is low and for some that value is negative.

TMC August 5, 2014 at 12:02 pm

“communist nonsense about helping people is piffle”

Good sentence (frament). I’d add socialist too.

dead serious August 5, 2014 at 12:23 pm

Right wingers typically lack the ability to feel compassion. Many would consider this a sort of birth defect, but it has its merits. Negative psychopathic connotations aside, the lack of this gene, or part of the brain – scientists haven’t yet pinpointed exactly where the disconnect lies – affords a sort of mental shield from the realities of the world in which the rest of us live.

This psychopathy in the end provides for a safe, soft cocoon-like existence in which “they” – any out-group member not within the right winger’s incredibly small, diaphonous inner circle – are seen as enemies, not to be trusted or, if possible, even acknowledged.

This allows the right winger to focus on a completely selfish life agenda, freeing up time usually spent interacting with and possibly even caring about others, to litter airwaves and blog comment sections alike with ideological tilting.

Thomas August 5, 2014 at 6:53 pm

Nothing is more compassionate than threatening to murder your neighbor if he doesn’t give you his property so that you can donate it to the local thespian’s club.

Explodicle August 6, 2014 at 8:22 am

Calling it threats won’t work because in his eyes, that property already belongs to the state. After all, rights and property are determined by voting.

dead serious August 6, 2014 at 12:40 pm

So this tired old bullshit again.

Go build your own roads, fund your own military, raise your own police forces. Then you get to start complaining about “theft.”

Better yet, go live on an island somewhere so you won’t be robbed with the much better side effect that normal people no longer have to listen to you morons.

Cliff August 6, 2014 at 3:41 pm

Classic example of mood affiliation by dead serious. All conservatives have mental defects and care only for themselves!

dead serious August 6, 2014 at 5:39 pm

A bit ludicrous, right?

Dead serious was not being serious, but rather turning the mirror back around at those summarizing what progressives think and feel.

Careless August 7, 2014 at 2:55 pm

Yep, DS, and that’s not a “straw man”

Eric H August 10, 2014 at 8:54 am

I would like to see dead serious apply his analysis to this assertion. I will guess that he is willing to tolerate such statements from his fellow travelers while imagining that only non-progressives believe in unrealistic models of human behavior and economic calculus.

prior_approval August 5, 2014 at 9:18 am

The bump in the road that the Bartley J. Madden Chair in Economics at the Mercatus Center is willing to accept while taking those small steps to a much better world?

Thomas August 5, 2014 at 6:51 pm

All automobiles could be constructed like tanks with a million air bags and safety devices and no one would ever die in an automobile accident. You failed calculus, didn’t you?

Brian Donohue August 5, 2014 at 10:58 am

Today I learned that 490 people have been killed in motor vehicle accidents in Illinois so far this year.

Cars 490, Ebola 0.

Pharmaceutical executives need to get in line behind automakers.

Pshrnk August 5, 2014 at 4:47 pm

Without convenient transport how ya gonna get to da hospital in time? How ya gonna get the cryonicly preserved drug to Liberia?

Eric H August 10, 2014 at 8:50 am

I think you and Benny Lava are reading more into the OP than there is. He said, “The logic of profit-driven drug developers is no different than the logic of profit driving automobile manufactures.” It does not say anything about morality. The OP is about producing those thing, not buying them as Benny has read it. Confirmation bias?

andrew' August 5, 2014 at 8:22 am

Does the fda really not have distinguishing mechanisms between mass market and clearly not mass market treatments?

If not what explains this failure?

Jan August 5, 2014 at 8:55 am

The FDA does have different mechanisms for these types of conditions, and Alex constantly ignores it. I don’t know if he just hasn’t read a damn thing about the FDA (which would be weird, considering it is his hobby horse) or he is dishonestly using this as an example to push for lower evidentiary standards for all drugs, which would be inappropriate.

http://www.fda.gov/forindustry/DevelopingProductsforrareDiseasesConditions/default.htm

http://www.fda.gov/forconsumers/byaudience/forpatientadvocates/speedingaccesstoimportantnewtherapies/ucm128291.htm

http://www.fda.gov/drugs/resourcesforyou/healthprofessionals/ucm313768.htm

http://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM358301.pdf

Alexei Sadeski August 5, 2014 at 9:13 am

…or the FDA’s special track isn’t sufficiently quick and cheap to make a difference.

Jan August 5, 2014 at 1:15 pm

Well if you read industry surveys and reports about these programs you’ll see they are very well received. And if you look at the numbers, you’ll see that the programs are utilized on a very large scale.

Alexei Sadeski August 5, 2014 at 2:13 pm

Far be it from me to suggest that, perhaps, established industry members may be thrilled to have onerous FDA regulations effectively bar upstart competitors from competing to their fullest extent.

Far be it from me to suggest that, perhaps, what one person considers “a very large scale” another may consider “a very small scale”.

Jan August 5, 2014 at 2:33 pm

Well these programs aren’t targeted to particular companies. They address orphan conditions and entire drug classes as a whole. If literally all drugs in a class are able to take advantage of these programs, how can they be expanded? Should, for example, FDA be setting targets of xx number of new antibiotics 10 years? It seems that setting the regulatory barriers as low as possible without forgoing necessary assurances of minimal safety (and often effectiveness) is about as much as Congress and FDA ought to be expected to do. How would you measure success?

prior_approval August 5, 2014 at 9:24 am

‘and Alex constantly ignores it.’

Such familiarity – the Bartley J. Madden Chair in Economics at the Mercatus Center is proud to independently follow the work of the distinguished person who funded the Bartley J. Madden Chair in Economics at the Mercatus Center.

Such as ‘Free To Choose Medicine: Better Drugs Sooner at Lower Cost.’ An article concerning the issue can be found at http://www.fed-soc.org/publications/detail/free-to-choose-medicine

Click quick though – you wouldn’t want to miss the opportunity.

frank August 5, 2014 at 11:50 am

Such familiarity – it’s almost as if you “used to work at GMU.” From now on, I’ll include “Disgruntled & Underappreciated GMU Bathroom Custodian Emeritus, Current MR Conspiracy Theory Troll” after all of your comments so people will understand your incentives in the same sneering and self-assured but fatuous way you suggest you understand these bloggers’. For transparency. You’re welcome.

Dave Anthony August 5, 2014 at 9:35 am

“an example to push for lower evidentiary standards for all drugs, which would be inappropriate.”

Would it? Are you saying that all of the FDA’s current standards are perfect? I would certainly question whether their standards are currently “just right”.

We are still waiting on approval for new sunblock formulations that Europe has had for over a decade. So that by itself is pretty good evidence that at least SOME standards need to be lowered (or bureaucratic roadblocks need to be removed).

Jan August 5, 2014 at 1:21 pm

You’re jumping the shark here. The trend has been toward lower standards and more guidance for industry. You explain to me what just right is and we’ll send a letter to FDA. Meanwhile they are still approving drugs faster than other agencies, especially cancer meds. I see your point about sunblock, but I honestly couldn’t care less about that particular issue.

Thomas August 5, 2014 at 6:56 pm

“Moar Raygulashuns, Moar Bettar” – Jan

Jan August 5, 2014 at 10:39 pm

Did I say that? These drugs are already regulated. I’m in fact against more regulations for drugs, ya moron.

Andrew' August 5, 2014 at 1:51 pm

“Not a problem because we have addressed the problem”

There is virtually zero risk of ebola drugs being marketed to inappropriate patients. I’m not sure why the FDA has any “mechanism” other than carte blanche.

Eric H August 10, 2014 at 9:05 am

Thank you for this post. The signal to noise is very low in this comment thread, especially from those who seem to believe that Alex is somehow wrong but don’t seem to have any suggestion for fixing the situation. This at least is real data that suggests Alex may have overstepped his argument. I will say, however, that I would not rely on the reports of how well-received these are by the industry for a gauge of how good they are. Publicly, Bootleggers love Baptists. Also, though it has been some time since I looked into it, I have my doubts about your assertion that the FDA approves drugs faster than other agencies. As I recall, the FDA is less inclined to accept other countries’ test data than they are of each others’ or the FDA’s data.

Axa August 5, 2014 at 8:23 am

@Alex, since when the FDA can prosecute a company for selling drugs in Africa that are not approved in the US? FDA has rules on this topic: F. Exports of Unapproved New Drugs and Biological Products to an Unlisted Country – Section 802(b)(2) and (b)(3) of the Act http://www.fda.gov/RegulatoryInformation/Guidances/ucm125799.htm#exports

Briefly, if the drug developer presents “credible scientific evidence” of drug effectiveness under the importing country conditions, and as long as the importing country health authority approves the drug, the export can be made. The drug does not need to be FDA approved to be exported.

Also, on moral bankruptcy…….even poverty focused NGOs like Oxfam ignores ebola. Oxfam alone fundraised 751 million euros in 2013, that’s 1 billion USD per year. It’s easy to blame drug developers, what about the unwillingness from people that specialize in fundraising money to help people in poor countries to fund drug development?

albatross August 5, 2014 at 1:25 pm

If you were trying to maximize the improvement in human well-being with your money, research into ebola treatments or vaccines would not make it anywhere into the top thousand ways to do good via spending. Probably you’d spend the money on DDT-soaked mosquito nets.

If you were trying to maximize the improvement in human well-being with your money by doing drug development, likewise ebola would not make it anywhere into your top thousand ways to do good. There is a vast number of diseases out there which do enormously more damage. Perhaps you’d be working on developing new versions of common vaccines that don’t need a cold chain and can be given by minimally-trained people, or cheaply-producable treatments for widespread diseases that kill and sicken a lot of poor children (anti-parasite drugs, I imagine). Treatments for cancer or heart disease would probably be relatively far down the list, since most of the victims of those things are relatively old when they die–in terms of years of life saved, finding a complete 100% cure for (say) pancreatic cancer would ultimately have a pretty small effect.

Andrew' August 5, 2014 at 2:47 pm

To a first approximation, you can’t make money from Africans.

So, you develop a drug, then the FDA has you over a barrel if and when you want to sell it where you can make money.

And that is after giving your competition years of catchup.

Jim August 5, 2014 at 8:25 am

The real question here is why does the us make all the new drugs?

Where is China, India, Germany, Australia, Indonesia….

Maybe that morally bankrupt profit motive is related somehow….

Jan August 5, 2014 at 9:10 am

Because we subsidize the world’s drug development costs by not negotiating drug prices or otherwise regulating prices. Is it that hard to figure out? Europe wins, we lose, and we all get the occasional new drug, which costs much more in the US than it does in Europe. See Sovaldi.

Slappy McFee August 5, 2014 at 9:24 am

You have to work on your satire. See Alexei. He/she is hot today!!!

Alexei Sadeski August 5, 2014 at 2:14 pm

In Communist America, genders do not exist!

prior_approval August 5, 2014 at 9:32 am

‘Germany’

I guess Bayer AG – http://en.wikipedia.org/wiki/Bayer – is too busy doing something like this? – ‘Work is also focused on the development of tracers for positron emission tomography (PET). The PET tracer florbetaben F18 in Bayer’s pipeline makes it possible to recognize beta amyloid, one of the pathological hallmarks of Alzheimer’s disease, with high accuracy very early on and while the patient is still alive.’

Or you can read their top 10 pharmaceuticals here – http://www.bayerpharma.com/en/company/about-us/top10-products/index.php

Dan Weber August 5, 2014 at 9:57 am

http://pipeline.corante.com/archives/2010/11/09/where_drugs_come_from_by_country.php

America discovers almost half the drugs that are brought to market. Other countries make stuff, but they fund themselves by selling to American customers.

On a per-drug basis, the drugs the US labs make are also more likely than other countries to be innovative (new categories) and to be in the unmet-medical-needs category.

prior_approval August 5, 2014 at 10:51 am

‘On a per-drug basis, the drugs the US labs make are also more likely than other countries to be innovative’

You do realize that of the world’s 10 largest pharma companies, 6 aren’t American, right? http://en.wikipedia.org/wiki/List_of_pharmaceutical_companies Obviously, size is not a true measure of innovation – but it is a good indication of where the profits from the American market are going. And it isn’t to finance American drug companies.

‘Other countries make stuff, but they fund themselves by selling to American customers.’

As an American noted, “There’s a sucker born every minute”. The suckers aren’t the ones selling their pharmaceuticals to Americans, however.

Michael B Sullivan August 5, 2014 at 1:03 pm

You’re agreeing with Dan Weber, though you seem to think you’re disagreeing with him. Both of you are saying that America subsidizes the cheaper drugs in other countries, by delivering much larger profits to the makers of the drugs.

Perhaps the source of your disagreement is that you think that if those profits disappeared, everything else in the world would continue on exactly the same way it has?

John Smith August 5, 2014 at 2:02 pm

+1000 MBS!!!

PA, Jan, Oakplug, and the whole gang advocate for single payer at every corner, yet completely REFUSE to acknowledge such a move would kill the golden goose of medical innovation.

Unless we’re limiting our discussion to how dumb US citizens are for paying much higher prices, then we can talk about profit motive.

Jan August 5, 2014 at 4:10 pm

Did I advocate for single payer? Is subsidizing medical innovation for the world the sole responsibility of the US? Just asking.

John Smith August 5, 2014 at 4:38 pm

Between your talk of healthcare not being a market good and the need to “not pay more than we have to”, your writing sure seems to align with single payer. But maybe I missed something…

What is your preferred method for not paying more than we have to for medical therapies? Just asking.

It is no more our responsibility to subsidize the world with drugs than it is to protect it from evil. But both of these things we do, for good or bad. I personally think it sucks that assholes like PA are able to move in Germany and still benefit from an American military ready to protect him and made-for-America drugs ready to save him.

The fact that he speaks with condescension rather than gratitude just makes it that much more obnoxious.

Dan Weber August 5, 2014 at 7:37 pm

I think it’s “unfair” that the US basically subsidizes drug discovery for the world, but without convincing other countries to increase their medical spending, the US is stuck. Either it keeps on paying, or it stops paying, which is likely to drastically diminish drug discovery.

So, rest of the world: you’re welcome. Bastards.

Jan August 5, 2014 at 10:44 pm

Js, do you think we cant have rational payment policy without single payer? I included a number of policy prescriptions throughout the comments. Please read.

John Smith August 6, 2014 at 12:28 am

Jan, is it better to lie than just answer my question?

This is the closest I found you talking about reigning in drug costs: “Or the cost is allowing the federal government to negotiate drug prices, just like every other country in the world does, which conservatives can’t bring themselves to do. To conservatives, the reason we shouldn’t do this is a principle that the free market will lower prices, and they have deluded themselves into thinking that health care and drugs are free market goods. They take this principled stand against something that would save us tens of billions of dollars per year while we subsidize the rest of the world’s drug development costs. They can’t see beyond their own idealized free market utopia, so they end up skipping reality. Either that or they are the drug companies’ last friends, so feel compelled to keep giving them sweetheart deals on US taxpayer markets.”

Not only does that sound like advocating for single payer – like every other country in the world does – it’s also the only place you remotely mention a policy for cost containment. The rest of your comments all pertain to FDA policy or your hard-on for Sovaldi.

Yes, I think we can have a rational payment policy without single payer.

Jan August 6, 2014 at 10:18 am

So then we need to do what I have recommended. Paying for value is basically what it comes down to.

Dan Weber August 6, 2014 at 7:45 pm

Not only does that sound like advocating for single payer – like every other country in the world does

There are as many ways of running a health care system as there are countries. Only a fraction fall under the header of “single payer.”

Klein has an essay “what liberals don’t get about single-payer” that tries to disabuse the left[1] of the notion that there are just two kinds of health care system: the good cheap public kind everyone else uses, and the bad expensive private kind the US uses.

[1] conservatives have their own myths that are pretty similar, and the essay is still good for them

Shane M August 5, 2014 at 5:53 pm

And more pharmaceutical and biotech companies are leaving the U.S. every year to take advantage of tax law.

http://online.wsj.com/articles/u-s-treasury-exploring-ways-to-deter-tax-inversions-without-congress-1407265800

Maybe it’ll be easier to negotiate better prices if they’re not American firms? Or will they still be large campaign contributors to the political parties?

The Other Jim August 5, 2014 at 12:04 pm

Because making new drugs is difficult, expensive work.

Much better to free-ride off of all the Americans’ work, and then have the Americans subsidize your purchase of the drugs when they are for sale.

Ed August 5, 2014 at 8:50 am

I found the fly the Ebola patient to the US the most interesting part. Its not germane to the post, but how was that not a lunatic decision?

Dave Anthony August 5, 2014 at 9:38 am

Because Ebola isn’t that contagious. It kills up to 90% of those infected but so far only 900 have died in a pretty populous region of Africa.

Dan Weber August 5, 2014 at 9:42 am

Life isn’t a movie plot. If it was, flying the guy here would give us all Ebola. But on the plus side, giving the guy a secret serum would create a superhero.

randomworker August 5, 2014 at 8:53 am

All? Not all.

Global Drug Discovery: Europe is Ahead

http://content.healthaffairs.org/content/28/5/w969/T1.expansion.html

mofo. August 5, 2014 at 8:53 am

Honestly, Pharma companies should re-organize around a not-for-profit model, or at least form a non-profit sub company that they can all support. That kind of mostly empty symbolic gesture pays huge dividends among the vacuous, moralizing left.

dead serious August 5, 2014 at 9:04 am

I think even *you* don’t know what you’re arguing for or against.

But you’re a real modern-day Don Quixote, aren’t ya. Keep up the good work.

mofo. August 5, 2014 at 9:17 am

My point is that to dim wits like you, nothing is more important than feeling superior to others. You have no desire to think beyond that so the only solution is to undercut your phony moral stance.

dead serious August 5, 2014 at 10:59 am

If I feel superior, it’s only because I am far smarter than you. Don’t be a hater – it’s unbecoming.

I’m also morally superior, but on this issue I understand that there are limited resources and not everyone can be saved all the time. So while I’m pretty much superior on all fronts, it’s not important to me to feel that way.

Feel better, junior?

mofo. August 5, 2014 at 11:07 am

Better? I was never feeling bad in the first place. Im happy to see the pretense drop so we can all see the undeserved arrogance at the core of you.

Jan August 5, 2014 at 9:22 am

Why would they do that? Buying a drug for $11 billion with a $300 billion US market is working just fine, thank you. And the vacuous, moralizing left hasn’t seemed to make them budge on charging $84,000 per US treatment and $900 in Egypt for the same drug. They are immune to public opinion, even Congressional inquiries.

http://www.forbes.com/sites/theapothecary/2014/06/17/the-sovaldi-tax-gilead-cant-justify-the-price-its-asking-americans-to-pay/

http://www.grassley.senate.gov/news/news-releases/senators-seek-details-sovaldi-pricing

Dan Weber August 5, 2014 at 9:43 am

Charging less money to poor people? ASSHOLES!

Brian Donohue August 5, 2014 at 11:26 am

Zing!

Jan August 5, 2014 at 12:58 pm

Ha, no, its because that is what Egypt will pay, not because of any sort of compassion for poor people. You do realize that, right? They charge the most they can get in any market.

Thomas August 5, 2014 at 7:01 pm

No, you got called out. So incredibly dense.

Jan August 6, 2014 at 10:17 am

No, it is because that is what the market will pay in each country. If you don’t understand that you are a moron.

mofo. August 5, 2014 at 9:52 am

So now we are beating our chests about the cost differential of drugs? Why do you hate poor people Jan? Why do you want to increase the price of drugs to the point where Egyptians cant afford it? To save a few dollars for American insurance companies? I guess you just hate Egyptians.

Jan August 5, 2014 at 1:02 pm

It’s not about making others pay more, it’s about us not paying more than we have to. A company will charge whatever they can get out of us, but they will also continue to do business so long as they make any profit, even if it is slightly lower.

Dan Weber August 5, 2014 at 3:20 pm

I’m sure they are out for every dollar.

They also use the lure of dollars to pursue things. There’s not really much money in Ebola, as has been pointed out repeatedly all over this page.

Price discovery is good. How much is curing hepatitis worth? How much is curing diabetes? How much is curing Ebola?

Our current method definitely isn’t the only method for drug discovery. But before you screw up the current method, you should have your alternative model ready to go[1]. If you declare that there is “too much money” to be made curing hepatitis, you will only discourage further research into hepatitis. I don’t know, and especially you don’t know, exactly what the cut-offs are where we lose things, because avenues of consideration will simply be ignored completely.

[1] Prizes can be a decent mechanism. But Alex will never build a coalition for them with his “let’s destroy patents” bandwagon.

I also think it would be a very useful political exercise for the USG to declare up-front how much it will pay for each dose of, say, a cure for pancreatic cancer. Let’s watch as the people with pancreatic cancer work, a priori, to make that number as big as possible in order to encourage people to find a cure.

mpowell August 5, 2014 at 12:26 pm

Jan, at this point it really is unclear what you are after. Should we stop developing these drugs? Should we insist that they charge the Europeans and Egyptians $84,000? What is it that you want? Do you really believe that you can get the drugs without someone spending the money? Yeah, the pharmas make money, but it’s not like their net margins are huge or anything. Public funding could maybe be 20 or 30% less expensive, but then you’d lose market discipline. Is your preferred solution helping the corporations (many of which are not US based) to force Europeans to pay more? That would probably be fair, it just seems really implausible.

Jan August 5, 2014 at 12:56 pm

We should pay for what we need, not whatever pharma develops. We should do that through better targeting of fast review programs and greater incentives for the most needed therapies. We should also pair this with more European style negotiation and limited coverage of drugs that have competitors within their class. In some cases we should also directly fund more research.

Dan Weber August 5, 2014 at 3:29 pm

I assume you have run the numbers for how much pharma “really needs” in order to continue drug R&D and have figured out how much the US can “save” and concluded that the reduced revenue won’t discourage any drug discovery. Please share with the class.

Jan August 5, 2014 at 4:09 pm

Nobody knows how much pharma really needs–not even their trade associations. But I submit that they can most certainly do with slightly lower revenue. One indication are the studies that find pharma spends more on advertising than R&D. Even if the estimate is a little off, the fact that this industry spends anything close to as much on on ads as R&D tells me there is much room for improvement. Anyway, most the large companies have switched to a model where they buy innovations from smaller developers and just do clinical trials and file FDA applications. That is not the business model they were built on.

Do you know how much pharma really needs? Are you saying there are no savings? Does the US perhaps need to spend even more for innovation? How much more? Do you include copycat drugs? What about third and fourth in class therapies that confer no additional benefit? Show your work.

Dan Weber August 5, 2014 at 7:55 pm

I’m not the one advocating trashing the current system. The default is what we have right now, and it’s what we’ll keep on having. Chesterson’s fence.

One indication are the studies that find pharma spends more on advertising than R&D

You probably mean “marketing”, which includes both ads as well as market research, to find out where the biggest markets are for drugs. The CBO says that DTC advertising is only 1/4 of marketing spending. Gilead, which you excoriated upthread, spends less on total marketing than on R&D.

Anyway, most the large companies have switched to a model where they buy innovations from smaller developers and just do clinical trials and file FDA applications

Yes, but it’s still the same basic economics. Instead of the big companies doing a bunch of research, and then funding what works, a bunch of smaller companies do research, with most of them failing but the one that gets it right gets bought out for same price. The people who finance those small companies aren’t idiots, and they make sure the payoff for the winner covers all the losers.

Do you include copycat drugs?

That’s funny. If copycat drugs were so useless they wouldn’t even make it past FDA approval. See also http://pipeline.corante.com/archives/2011/01/26/those_metoo_drugs.php

Jan August 5, 2014 at 10:54 pm

FDA has no say in whether a copycat drug is useful or not. As long as it is safe and effective it gets approved, even if there isnt a need for it.This is where marketing comes in. Tell me why Nexium was needed and why it made so much money.

Gilead has a drug that cures hep c. No marketing needed. They just had to buy it from an innovative firm.

Dan Weber August 6, 2014 at 2:56 pm

FDA has no say in whether a copycat drug is useful or not. As long as it is safe and effective

Are we talking about me-too drugs, where (in some people’s minds) one company just waits for another company to find the drug, and then tries to make something similar? You have to be better than the existing treatment to get FDA approval.

Timothy August 5, 2014 at 8:55 am

“The process by which the medication was made available to Dr Brantly and Dr Writebol is highly unusual. ”

Well.

mofo. August 5, 2014 at 9:11 am

Here is the VOX equivalent:

http://www.vox.com/2014/8/4/5963751/the-real-cause-of-the-ebola-outbreak-its-not-what-you-think

Same shit, but slightly better arguments.

China Cat August 5, 2014 at 12:16 pm

Thanks, meng. That was a hoot.

“Namely, the global institutions we designed to promote health innovation, trade, and investment perpetuate its spread and prevent its resolution.” below a photo of 3 women, one with her hand in her pants, the other two standing in a pool of used handwashing water. This is the temporary handwashing station set up outside the Sino-Guinean hospital after they have an outbreak.

Can’t make this stuff up.

Jan August 5, 2014 at 9:16 am

Moreover, it’s not at all obvious why the burden of producing unprofitable drugs should fall on the drug manufactures. To the extent that there is an ethical case for developing drugs for the poor it’s a burden that falls on all of us..

Poor drug companies! But wait, the drug manufacturers don’t shoulder all the burden of developing new drugs. The public sector has played a significant role in developing an exceptionally large share of new drugs over the past few decades.

http://www.nejm.org/doi/full/10.1056/Nejmsa1008268

Dan Weber August 5, 2014 at 10:02 am

That paper calls MIT a public-sector research institution. Okay, I guess. MIT sure made lots of royalties off of licensing their stuff, so it’s not like they didn’t get paid.

Universities discover a whopping 24% of new drugs: http://pipeline.corante.com/archives/2010/11/04/where_drugs_come_from_the_numbers.php

This reviews where drugs that are actually brought to market were first discovered. They are broken

prior_approval August 5, 2014 at 10:39 am

From your link – ‘Well, we can answer it for the period from 1998 on, at any rate. A new paper in Nature Reviews Drug Discovery takes on all 252 drugs approved by the FDA from then through 2007, and traces each of them back to their origins.’

As has been pointed out, the FDA only regulates the American market. These numbers are limited to the U.S., whose health care market is truly exceptional – at least when it comes to things like sun blocking lotions, or total parenteral nutrition, or drug shortages – ‘This isn’t the first drug shortage the FDA has been forced to deal with. In fact, the Washington Post says, shortages have increased dramatically over the past six years, particularly for drugs that are used in great numbers in hospitals — including some antibiotics, painkillers, and anesthetics — but that don’t make much money for the companies that manufacture them. There have also been shortages of certain cancer drugs.

The FDA is allowing imports from outside the U.S. in larger numbers to address the shortages, the Washington Post adds. The agency estimates there are now 129 drug shortages in total in the U.S.’ http://www.medicaldaily.com/theyll-starve-death-fda-oks-drug-imports-address-nutritional-medicine-shortage-sick-babies-246338

albatross August 5, 2014 at 1:34 pm

I’m no expert, but I’m pretty sure the original discovery isn’t the expensive part of bringing a drug to market. The problem is that a *lot* of things look promising and exciting in the lab, but most of them don’t make it through the whole process to get approval–they work in the model animal but not in people, or they cause bad enough side effects that they do more harm than good, or whatever. That original discovery is really important, but it’s only the first step, and most of the original discoveries never make it to being approved as drugs.

Dan Weber August 5, 2014 at 7:57 pm

Sure. And less than a quarter of the drugs even start in research institutes.

Jan August 5, 2014 at 2:50 pm

Where do you think MIT gets most of its research money? The fact that they get royalties from their developments is irrelevant in tis case. They are discoveries made possible by Uncle Sam. US government doesn’t require that revenue generated by research done under NIH grants be given back to the government.

Dan Weber August 5, 2014 at 9:20 pm

Where do you think MIT gets most of its research money?

That’s a good question. Industry is a big supporter at MIT. Someone should do the research to find out who supported the grant research to discover those various molecules.

Jan August 6, 2014 at 10:15 am

$58 million from NIH in FY2014 alone. ;-)

Dan Weber August 6, 2014 at 7:47 pm

And lots from industry. Not to the $50 million mark, though. Some health care researcher who wants to dig through a bunch of stuff could probably find out who was the funder of each individual drug that started at a university instead of just assuming “university == federal support.”

ZZZ August 5, 2014 at 9:25 am

“According to CNN, the drug was developed by the biotech firm Mapp Biopharmaceutical, based in California.

…health workers said drugs that could fight Ebola are not particularly complicated but pharmaceutical firms see no economic reason to invest in making them because the virus’ few victims are poor Africans.”

Can someone please explain these two sentences in a way that doesn’t imply the author is an idiot, because I can’t.

Dave Anthony August 5, 2014 at 9:41 am

I guess their point was that the drug didn’t go through all of the extremely expensive steps the FDA requires in order to bring the drug to market, because their is no profitable reason to. But clearly they did do SOME investment in working on a cure — which may have come from NIH grants (who knows, the article doesn’t specify).

Yancey Ward August 5, 2014 at 11:29 am

Exactly. In the case of a disease with the mortality of Ebola, the expensive part would be all the downstream efforts that come after the discovery of an agent that can ameliorate the disease in vivo.

Wolf August 5, 2014 at 9:29 am

As if far right religious fanatics never moralize.

Hazel Meade August 5, 2014 at 10:04 am

On the other hand, nobody takes the far rights fanatics’ moralizing seriously anymore.

Dan Weber August 5, 2014 at 10:16 am

Doonesbury sure seems worried enough about it to keep on bringing it up.

Thor August 5, 2014 at 12:38 pm

Still? I gave up on D years ago precisely for that reason.

mofo. August 5, 2014 at 11:18 am

FWIW, i put ‘far right’ moralizers in the same category as ‘lefty’ moralizers.

Hazel Meade August 5, 2014 at 9:54 am

Even if all medical research were nationalized, it’s unlikely that significant resources would be invested in fighting Ebola. A pure utilitarian calculus would lend itself towards more investment in breast cancer and diabetes treatment. Unsurprisingly, you can also make more money curing diseases that lots of people suffer from.
People under estimate the extent to which economicically rational calculations mirror socially utilitarian calculations in a free market.

Sanjay August 5, 2014 at 10:01 am

Crampton/Tabarrok’s final point confuses me though — for this type of disease, with few opportunities fr large-scale trials, there is a well-established procedure for giving IND vaccines and drugs, and indeed I’ve received a few of them myself, some of which have been administered to researchers for decades. Presuably that’s what was done here, and you ould in theory do it for whomever although the informed consent issue is the hard bit. That, not changing the FDA process, seems like the right solution, since otherwise you _do_ have that informed consent problem.

Nick L August 5, 2014 at 10:04 am

I bet if those few thousand people that have died since 1976 lived in the US instead of Africa we’d see Mapp Pharmaceutical investing heavily in research for this drug.

Hazel Meade August 5, 2014 at 10:09 am

And if America was a socialist country, the central committee would decide that spending money on non-Americans treatment was not something that was worth of the People’s investment.

In what universe do people spend a lot of money researching cure for diseases that only afflict a few thousand people in other countries thousands of miles away? Did the Soviet Union or communist China ever spend significant amounts of money on Ebola research?

prior_approval August 5, 2014 at 10:43 am

‘And if America was a socialist country, the central committee would decide that spending money on non-Americans treatment was not something that was worth of the People’s investment.’

But in a social democratic country like Germany, with its completely free market pharma companies and completely private health care providers (assuming one considers a hospital owning organization like the Catholic Church private), nothing like that happens at all.

XVO August 5, 2014 at 5:10 pm

Then why didn’t the Germans develop the drug for the Africans?

Jamie_NYC August 5, 2014 at 5:21 pm

“Did the Soviet Union or communist China ever spend significant amounts of money on Ebola research?” Possibly. Soviet Union had an extensive bio-wepons research program.

David C August 5, 2014 at 10:08 am

FDA trials for a drug like this would never be placebo controlled. Its unethical, and wouldn’t be approved by an Institutional Review Board. In a case like this, the drug being tested would be added to the current best standard of care in one group, and standard-of-care-only would be used in the other group. A likelier issue in this case is the amount of animal safety data that was collected and reviewed by regulators before dosing the patients. It sounds like things are going well for these patients, but the reporting would be very different if they had suffered serious and unexpected side effects.

Eric Rasmusen August 5, 2014 at 10:10 am

The comments on this post are more interesting than usual– maybe the post should have an addendum with the good bits. Two more:

1. Ebola vaccine is an interesting business proposition. Here is the problem, I think. The vaccine has a 99% chance of being unprofitable because there’s no epidemic. It has a 1% chance of being wildly profitable because a million people die. First off, this means it is too chancy for an undiversified small firm— it has to be a big company. Worse, though, with high probability if the epidemic does occur, the government will act to prevent the company from “profiteering”, perhaps even requiring them to set the price at average cost. That would be a 99% chance of negative profits and 1% of zero profits.

2. Some commenters mentioned the military. Are they exempt from FDA requirements? Or could they do their research abroad? This coudl be a great “backdoor” way to develop these low-profit drugs– even ones that have no military use. Once they’re developed, demand would arise, and hence political pressure. Patients could fly to teh Cayman Islands or some such place to be treated. The military coudl even make some profits off of it.

3. Note that it’s more likely this military research is for medical rather than weapons use. Already, there are diseases such as anthrax for weapons use, if we want to start up. But if the US army ever fights a war in Africa, disease is probably going to cause more casualties than bullets. Malaria alone will incapacitate more soldiers than the enemy will.

asdf August 5, 2014 at 2:51 pm

Yes, this is the point. What people are afraid of is that if there is an outbreak that its too late to research a drug then. There is a market demand for something that will stop a global epidemic that kills millions or worse, but it can’t be properly monetized in a free market.

What we’d like is that we had a pipeline/inventoried drugs capable to dealing with epidemic type diseases that could flare up suddenly but are not the kind of chronic condition diseases drug companies can easily monetize.

Rahul August 5, 2014 at 10:12 am

Why does FDA need to be involved in an Ebola drug trial anyways? Most of the affected are Africans, the potential beneficiaries will be them too, so wouldn’t a trial on African soil make more sense? (subject to whatever rules those nations’ authorities might mandate) If the drug looks good there and someone wants to market it in the US the FDA can step in at that stage.

Besides, I don’t see Eric Crampton’s objections to a placebo trial. No body is saying you try it out on *healthy* volunteers. You just ship the candidate drug to an ebola outbreak zone and randomly inject some patients with it and the others not. Why would that be so controversial? (In any case I doubt you are going to get enough initial funding for enough doses of new drug for 100% affected zone coverage anyways; so some patients not getting this new drug is predestined. Might as well exploit the RCT aspect of it)

Obviously there is already *some* existing treatment / management protocol so those that don’t get the trial drug get put on that. Guys pushing for a non-placebo route forget that there’s still the (small) chance that wonder-drug pushes that 60% fatality rate to a 80% rate.

Crampton comes alive August 5, 2014 at 10:15 am

After reading this thread, I feel kind of silly for defending this site’s commentors yesterday.

Mark Thorson August 5, 2014 at 10:52 am

I’m developing a drug to treat that condition, but I need more funding for clinical trials.

David August 5, 2014 at 11:01 am

Soooo… the analogy is: If we’re ok with a company refusing to take a loss on giving giving cars to the poor, we should be ok with companies refusing to take a loss on medicine for poor people who will otherwise die a horrible yet preventable death. Do you really stand by the aptness of that analogy?

Dan Weber August 5, 2014 at 11:26 am

Why should drug companies take the loss? Why not, say, Apple Computer? Have them fund the stuff.

When Bill Gates wanted a drug company to develop some medication to be sold cheaply to the third-world, he didn’t harangue them about being evil. He paid them a bunch of money because he wanted the job done and the job done right.

There’s nothing stopping you from paying to develop Ebola drugs.

Yancey Ward August 5, 2014 at 11:33 am

Exactly, and it is dispiriting that so many overlook this incredibly obvious point.

dead serious August 5, 2014 at 12:07 pm

It is obvious. Because one idiot in Great Britain says something, all progressives necessarily believe it? Let the government of GB fund it, is what I say.

What’s most telling to me is all the typical echo chamber reactionary dreck bubbling up here like Old Faithful. All the assumptions and declarations about ‘what progressives believe.’

Even worse: the market aspect of the issue gets conflated by some with the ‘FDA is evil’ talking point.

prior_approval August 5, 2014 at 1:35 pm

Well, considering that the first full sentence from the Bartley J. Madden Chair in Economics at the Mercatus Center was ‘Of course, pharmaceutical firms are not going to invest millions in getting a drug through FDA trials for a disease that has only killed a few thousand people since being discovered in 1976.’, it seems fair to note that the confusion was to found right at the opening. That is, assuming one believes that the Bartley J. Madden Chair in Economics at the Mercatus Center is ever confused when it comes to the FDA or the market for pharmaceuticals.

David August 6, 2014 at 9:00 am

Let me try my own analogy then:

If you’re OK with a drug company not taking a small loss to save the life of someone who will otherwise die horribly and preventably, then you’re OK with me refusing to take a loss to give away my Pepsi, when you are in diabetic shock somewhere on a trail and that is the only way to save your life. (You can substitute a more medically plausible situation if you like.)

And by “you’re OK with” I mean “you find this morally defensible” or “you find this to be consistent with all relevant ethical obligations.”

Dan Weber August 6, 2014 at 2:58 pm

That’s a pretty stupid analogy.

It’s not like the existing drug companies have a lock-up on all the protein sequencers and either they make it or no one else does. There are a bunch of abandoned drug research facilities if you want to buy one up.

Is Whole Foods responsible for someone starving in Canada, because they sell food?

Thomas August 5, 2014 at 7:11 pm

Yes, David, people die in automobile accidents everyday. Automobile manufacturers could take a loss on every vehicle sold in order to make it safer. They don’t. No surprise you didn’t pick up on that.

JasonL August 5, 2014 at 11:16 am

I don’t get it. I thought all the meaningful research was done by various national governments through university and lab funding. If it was so damn easy to release an ebola treatment, why didn’t a benevolent government somewhere do it?

Hazel Meade August 7, 2014 at 11:49 am

This. Because benevolent governments are driven by the political demands of people in their country.
Not a lot of Ebola cases in Western Democracies.

Anne August 5, 2014 at 11:24 am

This ebola treatment is so experimental that discussing FDA-approval requirements is premature to say the least. This was the first time it had been given to humans – this wasn’t even phase I.

Second, FDA is an American regulatory agency – it doesn’t make approval decisions for the whole world – each country has it’s own medical regulatory agency. Furthermore, the first patient with ebola showed up in the United States only a few days ago, and this “worst” outbreak only has 800-some reported deaths. 2,200 people in the US die EACH day from cardiovascular disease. So let’s get some perspective here.

Dan Weber August 5, 2014 at 11:27 am

The FDA is a sideshow. I’m disagreeing with Jan a lot on this thread but he got that part of his critique of this post correct.

Shaun P August 5, 2014 at 11:48 am

Of course buying a car is like contracting a life threatening disease. That’s why that analogy is so solid. Good job Alex.

The Other Jim August 5, 2014 at 12:11 pm

> no economic reason to invest in making them because the virus’ few victims are poor Africans.

It’s rare to see idiocy so perfectly encapsulated. This dope could have said “the virus has few victims” and been stating an obvious truth, but instead had to say the few victims “are poor Africans.” Jesus.

Reminds me of the last time I needed an oil change. I called up Petco for an appointment, but I ended up not going because they don’t do oil changes. Also the guy on the phone sounded Hispanic.

albatross August 5, 2014 at 2:23 pm

To be fair, a disease that had few victims, but they were all billionaires, would probably be economically sensible to develop treatments for. (Like the old Tom Leher joke about the doctor who specialized in treating diseases of the rich.) Although if you were a middle-class person with that disease, you’d be *really* hoping for some price discrimination in that case. (“The treatment for billionaireitis costs a million dollars per dose, and you’ll need a 30 day course of treatment.”)

Vu Cai August 6, 2014 at 3:51 pm

I share a similar view with many of the commentators here on this blog. The Ebola outbreak situation is quite complicated. So far the outbreak has not directly affected American soil, we are however, not immune to the virus and have very little to combat the virus if it were to strike us in America. I understand that there are hundreds of deaths attributed by Ebola, which is far less than many of the deaths by other diseases. That being said, fatality by any number should be sufficient for awareness. It is not a bad idea that we prepare for this epidemic, it does not have to necessarily be our sole priority, but Ebola vaccination should definitely be on our list.

We can first start with small trials in affected areas in Africa in order to test our current knowledge and treatment for the Ebola virus. I am not implying that we put all of our efforts into this, but it would be an experiment well worth partaking. It is not right to ignore the fact there is an epidemic and we refuse to spend money on learning more and establishing proper treatment/vaccination for the virus.

“There is nothing so patient, in this world or any other, as a virus searching for a host.”
― Mira Grant, Countdown

Boris Yakubchik August 6, 2014 at 5:57 pm

How about the solution proposed by Thomas Pogge, namely the Health Impact Fund (HIF) – http://healthimpactfund.org/

“The Health Impact Fund (HIF) proposal is promoted by Incentives for Global Health, a non-profit organization devoted to advancing market-based solutions to global health challenges.The HIF proposes a new way of paying for pharmaceutical innovation by incentivizing the development and delivery of new medicines through pay-for-performance mechanisms. All pharmaceutical firms worldwide would have the option of registering new medicines with the HIF. By registering, a firm would agree to provide its drug at cost anywhere it is needed, and in exchange for foregoing the normal profits from drug sales, the firm would be rewarded based on the HIF’s assessment of the actual global health impact of the drug. Governments and other donors would finance the HIF.”

http://www.saletrail.org/ads/weight-reduction-surgery-and-organic-ways-to-shed-weight August 7, 2014 at 2:12 am

Aw, this was an incredibly good post. Finding the time and
actual effort to make a great article… but what can I say… I hesitate a whole lot and don’t manage to get nearly anything
done.

Jack Roberts August 11, 2014 at 5:53 pm

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