Proponents of alternative medicine have long been ridiculed for their conviction that pharmaceutical companies don’t want to cure diseases for the simple reason that that would reduce their profits. But now they’ve come out and said it.
In its April 10 report “The Genome Revolution” Goldman Sachs asked “Is curing patients a sustainable business model?”
In that paper analyst Salveen Richter warned biotech companies against developing one-off treatments which provide inherently limited revenue streams when compared to long term treatments that manage but do not cure diseases.
“While this proposition [the ‘one shot cure’] carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.” – Salveen Richter, Goldman Sachs
By way of example Richter points to a recent hepatitis C treatment which achieved cure rates of 90%. The companies’ profits from this treatment peaked quickly in 2015, and have been falling ever since. Could there be a clearer demonstration that what is good for the patient and society is at odds with the profit motive? But the worst is yet to come…
In a cynical and chilling corollary, Richter goes on to explain that not only does such a rapid and successful treatment program quickly reduce the pool of available patients, but in so doing it also decreases the transmission rate and so reduces the pool of future patients that would otherwise become infected. That brutally cold logic and callous disregard just curdles my blood!
“In the case of infectious diseases such as hepatitis C, curing existing patients also decreases the number of carriers able to transmit the virus to new patients, thus the incident pool also declines … Where an incident pool remains stable (eg, in cancer) the potential for a cure poses less risk to the sustainability of a franchise.” – Salveen Richter, Goldman Sachs
In a scathing commentary for MedPage Today (Apr 18th) pharmaceutical consultant Dr Milton Packer, points out that many drug companies already know this, so price ‘one shot’ cures accordingly. He cites an example of Spark Therapeutics who earlier this year introduced its new single-dose cure (Luxturna) for a rare form of blindness. The price tag is an eye-watering $425,000 per eye. Yet, he says, even at this exorbitant price the returns on investment are not as good as for long term treatments that manage but don’t cure diseases.
Dr Packer should know what he is talking about, as he has worked for many of the pharmaceutical giants, including AstraZeneca and Bayer, yet he doesn’t pull his punches.
“If you develop a new drug that cures people rapidly, then patients will not need to take the drug on an ongoing basis, and that limits the amount of money a company can make.” – Dr Packer
He points out that this financial reality has narrowed the main fields of drug development to focus on only two therapeutic areas – cancer and rare diseases — as these are the only areas where exorbitant prices required by the business model will be tolerated.
“Want to make money? Develop drugs that cure nothing, but yet promote long-term use and dependency, and shorten life. Bankers and payers will love it. Oops! I forgot. We have those drugs already. They’re called opiates.”
To add insult to injury the British taxpayer is often paying twice to prop up the pharmaceutical industry. Two in five of the NHS’s most expensive drugs — including treatments for cancer, arthritis and multiple sclerosis (MS) — were originally discovered and developed using taxpayer funded-research.
From the article:
“Big pharmaceutical companies are ripping us off by taking over drugs developed primarily with public money and selling the drugs back to the NHS at extortionate prices. This is nothing short of daylight robbery of British taxpayers by some of the most profitable corporations in the world,” – Heidi Chow of Global Justice Now
Fixing this mess is not going to be straight forward, and there’s no quick fix — I certainly don’t have the answers — but with our healthcare heading for financial ruin there’s going to be a huge blister pack of bitter pills that need swallowing…
- CNBC Goldman Sachs asks in biotech research report: ‘Is curing patients a sustainable business model?’ (11 April 2018)
- MedPage Today It’s Official! Curing Patients Is Bad for Business (18 April 2018)
- The Independent NHS pays pharmaceutical companies millions for drugs developed with taxpayers’ money (21 October 2017)