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September 4, 2019

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Dear Friends and Colleagues:

This morning’s “Examiner” leads with an article that says “Big Pharma” has a lower public opinion rating than almost any other business.

While every industry has its critics, “big” has become a primary pejorative descriptor.  “Big” doesn’t always mean “better,” but in many cases it means necessary.  But, in some minds, “big” erroneously conjures up thoughts of rich folks with palatial mansions and garages filled with Rolls Royces and private jets at the nearest airport.   Using “big” as a pejorative also infers that “big” car companies, or “big” oil, or “big” pharma could somehow be “small,” or that pharmaceuticals might somehow be produced in someone’s garage.

Oh, and just for the record, I have never worked for a pharmaceutical company, nor do I own any of their shares!

Unfortunately, too few give any thought to the stringent requirements and high costs that must be met in order to develop and test and obtain approval for and introduce a new drug or other medicine to the public.  First, the company has to have a well-trained and experienced professional staff – with backgrounds in medicine, pharmacy, chemistry, epidemiology, engineering, mathematics and other technical skills.  These are in addition to other staff, such as HR, accounting, legal, maintenance, etc., that are common to all businesses.  So, high overhead is essential – and costly — long before a drug or medicine is discovered, approved, produced and sold.  And until the time of sale, there is NO income for the company to pay all those staff and overhead costs.

Getting a new drug approved is a long and difficult process.  The pharmaceutical company must conduct trials – with strict controls and high statistical  standards.  Thousands of “volunteers” with a given ailment or disease must be found and agree to participate in the testing – which means using the drug as prescribed with before-and-after and regular periodical physicals to determine the drug’s effectiveness – over time.  Meanwhile, part of the group will also be given a look-alike placebo rather than the drug, and medical conditions of the placebo group will also be tracked in exactly the same way and over the same time period as the real test group.  Only after years of lengthy testing and continued regular and documented follow-ups can the effectiveness of the drug be determined and the entire file submitted to the FDA for approval.

During the testing periods, the drug company also records any side effects and determines all contraindications attaching to the use of the drug.  These are also submitted to the FDA.  The “volunteers” are paid for their time and so are the costs of their medical visits and all monitoring.

All of the above means that the cost of bringing a new, lifesaving cure or a drug that ameliorates chronic symptoms runs into the billions of dollars and years of testing – which sometimes goes for naught if the drug’s anticipated benefits fall short.  Years of cost and effort with nothing to show for it are eaten by the private company…

So how is the pejorative “big” applicable to such massively costly undertakings?  Why?  Qui bono?  And, if new drugs seem expensive, one must ask how a company could recover its costs without charging for the drug?  If the drug treats a disease that affects millions, then the anticipated price for the drug would be less.  On the other hand, if the drug treats a condition that afflicts only a few thousand, the cost will be greater.  Insurance companies struggle with these same issues to a degree, and they are not liked very much, either, by many of the public.  Facts are stubborn things!

Finally, most of the medical breakthroughs and new miracle drugs are developed, tested and produced here in the USA.  There is no substitute for American medical ingenuity or production capabilities.  Drug patents must remain in effect until payback costs are met, and only after that can the patent protections be removed and less costly generic substitutes become available.

And as far the “opioid epidemic” is concerned, the companies that produce those strong painkillers sell only to qualified pharmacies and hospitals.  And, lest we forget, those pain killers are necessary quality-of-life saviors for those suffering from terminal cancer, chronic severe joint pain or other crippling pain.  The abuses leading to the “opioid crisis” are the faults of illicit drug dealers and complicit sales outlets who commit federal and state crimes by dispensing or selling drugs to any persons without valid, current, official prescriptions written by licensed physicians.  The drug companies are not the criminals.  Punish the actual crime and the criminals.

Old Frank

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