E-DRUG: A bad week for drug companies?
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[In the USA,a bill has been introduced into Congress that would require
government agencies to gather evidence comparing effectiveness and cost
effectiveness of the most commonly prescribed drugs. This is a welcome
development! Copied as fair use, WB]
BMJ 2003;327 (20 September)
A bad week for drug companies?
Richard Smith, editor
The United States is hugely important for drug companies. The pharmaceutical
market is worth more than $150bn, and annual spending has been rising by
almost 20% a year (p 642). Prices are not regulated in the way they are in
many other countries, and companies are allowed to advertise directly to
consumers-so boosting consumption. But now the cost of drugs has become an
important political issue, and a bill has been introduced into Congress that
would require government agencies to gather evidence "comparing
effectiveness [and] cost effectiveness" of the most commonly prescribed
drugs "relative to other drugs or treatments for the same disease."
The bill aims to reduce costs, but it could also improve quality. The
proposal is to conduct many more head to head trials of common
treatments-trials like the ALLHAT (antihypertensive and lipid lowering to
prevent heart attack trial), which showed that diuretics are just as good as
much more expensive drugs for treating hypertension. The whole world stands
to benefit from such trials.
The industry is lobbying against the bill, but its problems are much deeper
than congressional irritations. Companies are failing to produce enough new
drugs, and the investment bank Dresdner Kleinwort Wasserstein thinks that
the industry is operating a business model that is unsustainable (Guardian
12 September 2003). Companies have on average been producing three "new
molecular entities" a year, but the bank predicts this will decrease to 0.3
per company. The industry has been increasing sales by 12%-15% for 30 years,
with half of the increase coming from raised prices. Now globalisation and
political endeavours are making such price increases impossible.
The answer, the bank suggests, is further mergers -only mergers with a
difference. Companies should now concentrate on particular therapeutic
areas-cardiovascular, cancer, etc. This could give them "dominance" (which
sounds like a polite word for a monopoly) in those areas. The result could
be just a handful of companies.
The bill before Congress stops short of proposing that a drug would have to
be shown to be better than other drugs before being given a licence. Europe
doesn't require such a demonstration either, but the National Institute for
Clinical Excellence (NICE) in England and Wales looks for evidence that a
treatment is appreciably better than what is already available before
advocating its use in the NHS, which is most of the market in Britain. NICE
has just been independently evaluated by the World Health Organization, and
an important recommendation is that it "break its close links with the drug
industry and make its processes more transparent" (p 637). The institute has
set new standards of transparency, but drug companies have insisted on some
of their material being confidential. The material should be made publicly
available.
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