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Greg Critser's brilliantly incisive Generation Rx moves the conversation about prescription drugs to where it hits home: our own bodies. How, he asks, has "big pharma" created a nation of pharmaceutical tribes, each with its own unique beliefs, taboos, and brand loyalties? How have powerful chemical compounds for chronic diseases, once controlled by physicians, become substances we feel entitled to, whether we need them or not? How did we come to hate drug companies but love their pills?
Read on in Generation Rx for:
-- exclusive interviews with the strategists, scientists, and current and former heads of GlaxoSmithKline, Eli Lilly, Merck, Roche, and more
-- a first-ever, inside look at the rollicking business story behind pharma's rise to power
-- the dramatic effects our drug culture is having on our major organs, from the liver to the heart to the brain
-- why old bodies and young bodies are the biggest, and riskiest, arenas for our great American prescription pill party
-- how the largely uncharted terrain of polypharmacy (various drugs taken together) has unleashed unanticipated, often deadly, consequences on unwitting patients
Generation Rx will make every American who has ever taken a prescription drug look anew at what’s in our medicine cabinets, and why.
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GREG CRITSER is a longtime chronicler of the modern pharmaceutical industry and the politics of medicine. His columns and essays on the subject have appeared in Harper’s Magazine, USA Today, the Wall Street Journal, the L.A. Times, and elsewhere. Critser is the author of Fat Land: How Americans Became the Fattest People in the World (Houghton Mifflin), which the American Diabetes Association called “the definitive journalistic account of the modern obesity epidemic.” He lives in Pasadena, California, with his wife, Antoinette Mongelli.Excerpt. © Reprinted by permission. All rights reserved.:
Unbound The Strange and Very American Liberation of Big Pharma
THE MAN IN THE ARENA: WHY PHARMACEUTICAL COMPANIES BECAME SO AGGRESSIVE
In the world of bureaucratic Washington, D.C., few if any possess the gravitas and smarts to get away with quoting Teddy Roosevelt. Lewis Engman, Richard Nixon’s 1973 appointee as chairman of the powerful Federal Trade Commission (FTC), was one of the few. A Midwesterner with traditional Republican inclinations, Engman had the gift,” as one friend later put it people simply wanted to be around him. He was a handsome man, with a broad brow and piercing dark eyes, and he was a social creature, stylishly dressed and coiffed and noticeable on the D.C. cocktail circuit, where he could be seen in the company of many of the president’s closest advisers. Engman was a personable, if tightly wound, man as well, comfortable with business types and staff typists alike; when a young FTC appointee named Elizabeth Hanford (later Dole) had a minor accident and ended up in the emergency room on the day she was to be installed, Engman took his entire staff over to the hospital and swore her in while she was still in bed.
More importantly in a town of fiercely guarded opinions and fiefdoms, Lew Engman could take the heat of debate. He seemed to revel in it. Often he intentionally recruited lawyers with whom he did not agree. The notion,” a former staffer recalls, was that the tension would produce the best resolution.” That didn’t mean Engman was thwarted very often; yes, he could be imperious and even arrogant, but he was so personable and passionate that you wanted to agree with the guy.” Frustrated with the slow pace of getting anything done in D.C., Engman loved to invoke TR’s famous Man in the Arena” speech. It is not the critic who counts; not the man who points out how the strong man stumbles or where the doer of deeds could have done better,” he would quote, his brow furrowing. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, but who knows great enthusiasms . . . so that his place shall never be with those cold and timid souls who knew neither victory nor defeat.” It was an appropriate mission statement for a young man charged with running the FTC, which oversaw the business of the world’s most powerful, if at the time troubled, economy. The FTC itself had grown increasingly controversial. For decades the commission had operated somewhat like a European or Japanese finance ministry, not simply policing industry’s outright frauds and cons, but also regulating competition itself. The agencies under its purview, from the Civil Aviation Board (CAB) to the Interstate Commerce Commission (ICC), were so cozy with their respective industries that it was all but impossible for an upstart entrepreneur to compete. Traditionally the FTC chairman, in a tacit admission of the powerful regional political interests that had created that coziness, remained mute on the situation. The policy was never to criticize another government agency,” recalls Art Amolsch, who worked for Engman at the time and went on to become the foremost observer of the agency. That’s why the FTC was always known as the Old Lady of Pennsylvania Avenue. It was averse to almost any change and inclined to say no to anyone who dared suggest otherwise.” For a brief period in the late 1960s and early 1970s, responding to lawsuits and studies by Ralph Nader over everything from unsafe cars to overpriced drugs, the commission had gone on a proconsumer binge under Chairman Miles W. Kirkpatrick, and mainstream business types, the core of the imperiled president’s political base, had railed against him during the 1972 election season. To calm them, in 1973 Nixon appointed Engman; he was supposed to restore order.” In other words, to put things back where they were before the Naderites inside the commission got out of control again.
But Nixon, and whoever had done the personnel file work, misjudged Engman’s consumer credentials.
Although he was a classic 100- percent-free-trade, procompetition Republican, Engman had developed a strong proconsumer bent. As Time magazine would later put it, Engman saw the world as a Ralph Nader out of Adam Smith.” You could best serve the consumer, he deduced, by opening up the marketplace.
With that in mind and the national economy in trouble inflation was up and productivity was down Engman went looking for ways to use the FTC’s power to make the country more competitive and to make American life more affordable. Quickly he diagnosed a novel cancer on the nation’s economic corpus: the regulatory agencies themselves. By making it so hard for small businesspeoppppple to enter their respective industries, the CAB and ICC were hurting the consumer and inhibiting innovation, thereby retarding long-term economic growth and keeping prices unnaturally high. In a brilliant, landmark speech at the normally staid Financial Analysis Conference in 1974, he laid out his thesis: Much of today’s regulatory machinery does little more than shelter producers from the normal competitive consequences of lassitude and inefficiency . . . [it] has simply become perverted.” As a result, the consumer is paying plenty in the form of government- sanctioned price fixing.” It was time, Engman said, to consider serious deregulation.
Engman also went after what he called professional conspiracy.” He sued the American Medical Association over its ban on physician advertising something he believed deprived consumers of the ability to get the best doctor for the best price. He went after state medical societies for their bans on the advertisement of prescription drug and eyeglass prices. In fourteen months he filed thirty-four antitrust actions. The consumer was always the bottom line for Lew,” recalls Bob Lewis, who served on Engman’s staff. Is this going to benefit the consumer?’ That was always the question he asked at the end of the debate about anything.” By the time he left the FTC in 1977, when a Democratic administration was about to take office, Engman had succeeded in making deregulation a mainstream Republican goal. At age forty-two, he was a GOP legend.
And so it was hardly surprising that, in the fall of 1980, with a new president named Ronald Reagan onboard who was committed to getting government out of every aspect of American life, Engman would again be sought for his leadership skills. This time the organization in need of help was the Pharmaceutical Manufacturer Associations. The PMA represented the nation’s biggest brand-name drug makers, who were often referred to simply as big pharma” or simply pharma.” (The organization itself formally changed its name to the Pharmaceutical Research and Manufacturers of America, PhRMA, in 1994.) The PMA believed that the industry was in a crisis, suffering from increasing costs, slipping sales, foreign competition, and government overregulation. It was a crisis so severe as to provoke pharma CEOs to wonder out loud whether there will even be a U.S. pharmaceuticals industry in twenty years.” Then again, just about every major industry wondered something like that in the early 1980s, when it was widely believed that Japan was doing to U.S. industry what it had failed to do with bombs thirty-five years earlier.
Some, if not most, of pharma’s immediate crisis was of its own making, although this was not something most drug CEOs would admit. As a group and individually, they had simply failed to invest in new drug sciences and drug development. Instead, they had relied on (and indeed encouraged) the FDA’s lack of a generic-drug approval process, giving pharmaceutical companies de facto monopolies and huge profit margins on many widely used drugs. This state of affairs had provoked a legal backlash of its own; district courts from New York to California were actively contemplating, and in some cases ruling, that many traditional pharmaceutical patents were invalid. The Supreme Court itself had grown hostile to the very notion of patents. In the pharma executive suite of the time, there was only one word for that: shock.
Yet some pharma problems were largely out of the industry’s direct control. America in the late 1970s and early 1980s was going through one of its cyclical periods of what might be dubbed pharmaceutical stoicism. As a percentage of annual health expenditures, the Rx share was actually shrinking. And while cocaine might be hip, prescription drugs were uncool on a number of levels. On the cultural plane, drug makers were the domain of the blue-chip world, with which the baby boom had yet to fall in love. The growing alternative-medicine movement, with its reliance on herbs and vitamins, appealed to a generation concerned with what was natural. The movie version of One Flew Over the Cuckoo’s Nest rekindled old suspicions about psychiatric medications, one of the industry’s most profitable monopolies. News stories about abuse of Valium, one of the most profitable postwar drugs, led to its reclassification as a controlled substance in 1978, making it harder to prescribe. There were scares over new heart medications and horror stories about pharmaceutical industry negligence, and a new generation of ambitious politicians had no qualms about capitalizing on such fears. When a young congressman named Albert Gore learned from a staffer that a Pfizer attorney had made an off-the-cuff remark about how expensive it was to monitor the adverse events of one of his products ( What, are we supposed to schlep all over the world just to track down one goddamn side effect?” the attorney had sputtered), Gore promptly publicized the incident. Abroad and in D.C., big pharma was, more than ever, big fair game.
Worse from the point of view of pharmaceutical CEOs were attitudes and trends among young physicians and medical students. Many of them were deeply suspicious of the business end of medicine. Some of their attitudes grew from social activism by med students in the early 1970s, who were concerned with overmedication and polypharmacy. (Overmedication is the unnecessary use of medications in general; polypharmacy is the simultaneous use of several medications to treat one or more conditions.) The concern was deepest among young psychiatrists. In our day, it was almost an aesthetic thing to be against polypharmacy,” recalls one. It was more beautiful if you could do it with just one or two pills.” Many believed that growing rates of polypharmacy were fueled by pharma promotional activities, like giving out free samples and stethoscopes. At national meetings, the idea we talked about was to reject the goodies,” recalls Dr. Terry Kupers, who was head of the Medical Committee for Human Rights in the 1970s. [Pharma sales representatives] would show up at grand rounds, and we would confront them and turn down the goodies. We also went to our intern meetings within our institutions and told our supervisors that we did not want [the reps] on grand rounds. It was happening at enlightened medical schools around the country. We did it as a statement.” The statement registered in establishment realms, a further worry to pharma, when, in 1978, a number of influential medical journals began to consider banning prescription drug ads in their pages. As Steve Conafay, then a lobbyist for Pfizer, recalls, There was definitely the feeling that the industry was under attack and that something big had to be done.” Donald Rumsfeld, then the CEO of G. D. Searle, Inc., makers of a wide variety of drugs and chemicals, summed up the general attitude when, upon greeting FDA Commissioner Donald Kennedy, he sat down across from me,” recalls Kennedy, slumped a little, and said, What are we doing wrong?’” With Reaganism ascendant, the question quickly turned into: What is the government doing wrong? For Engman, now ensconced in PMA’s head office, the question should have been: What can I wring out of the new political reality Reagan’s pronounced antiregulatory bent that will directly benefit my membership, the nation’s brand-name drug makers? Certainly many of his members were clamoring for a preemptive strike, with several advocating an assault on the FDA and its much hated efficacy requirements. (Congress had passed a law in 1962, known as the Kefauver Amendments, changing the Food and Drug Act and mandating that makers of new drugs prove not just that their products were safe, but that they actually worked.) The chief of research at Pfizer, then as now one of the more politically active pharmaceutical companies, had been railing against the efficacy rules for years, saying they got in the way of delivering good new drugs.
But Engman didn’t think that way. He wasn’t interested in deregulation for deregulation’s sake.
Perhaps it was that consumer bug, or perhaps it was his heady experience as leader of an agency that served the public.” Whatever the exact source of Engman’s reservations, his eventual choice of legislative priorities finally came down to one issue: patent restoration. The subject had bubbled under the surface of FDA-industry relations for years. Simply put, the industry believed that the FDA was eating up the length of its patents, and profits, because of its slowness in processing new drug applications.
Companies with a new discovery had to file for a patent as soon as possible, to establish ownership of the idea, but then had to wait years for approval. By the time the drug was approved, the company might have as little as half the original seventeen years of patent life usually guaranteed to innovators. That led to higher prices, longer waits for new drugs, and a general disincentive to invest in new medications. It was true that the studies proving the case for patent restoration for laws that would give pharma additional compensatory patent time were weak and inconclusive, but the essence of the industry argument struck a nerve with Engman: here again was a case of overregulation hurting the economy of the nation and depriving the consumer of an improved product.
What should Engman’s PMA do? Sometime during the fall of 1980, he got an idea. He would use his old political contacts to shepherd legislation to extend pharmaceutical patents, adding up to seven years of exclusive marketing time for new drugs that had taken too long to get through the FDA approval process.
For a while, all of the old Engman magic seemed to work. He circulated studies showing exactly how industry suffered from FDA bureaucracy and how few new important drugs made it through the system. He lined up experts from leading medical schools to testify on the subject before Congress. By late 1982, he had managed to push the political process as well. A bill extending patent life was passed by the Senate and referred to the House for an expedited vote.
Yet the world and particularly Washington, D.C. does not lie under the spell of magic for long, and Engman’s bill went down to unexpected defeat. One reason was the weather; a dense winter storm had settled over Foggy Bottom on the morning of the vote, delaying the arrival of several key supporters. Then there was another, less natural phenomenon: a man named Henry Waxman.
Waxman, a short, balding, mustachioed man who represented the Westside of Los Angeles, was the quintessential manifestation of the new post- Vietnam liberal legislator. In just nine years he had risen from relative obscurity to the chairmanship of the powerful Subcommittee on Health and Environment of the House Energy and Commerce Committee. This ascent he accomplished via the unabashed use of a political action committee, by which he funded the campaigns of like-minded fellow Democrats, who would then support his nomination to important comm...
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