Supreme Court of India Rules Against Big Pharma

America spends about $200 billion a year on prescription drugs. It’s becoming part of American culture from preschool, where kids are started on Ritalin for ADHD, to old age where typical seniors are consuming an entire palette of pills for everything from arthritis to high blood pressure to cholesterol. Drugs are the fastest growing part of the health care bill.

In 2002 the average price for the fifty drugs most used by seniors was nearly $1500 for a year’s supply. That’s for each drug. Most seniors are taking an average of six.

Drug prices are highest for people who are the poorest. That’s because they have no insurance, and, therefore, no bargaining power. Drugs are marketed extensively by means of TV ads. Those ads are usually followed by ads for law firms trolling for clients who have been harmed by said drugs.

Drug companies say that they must charge such high prices to pay for all the research and development they do to discover new wonder, lifesaving drugs. The truth is more prosaic. Drug companies’ research budgets are dwarfed by their budgets for marketing, advertising and executive salaries. As in the hospital industry (which we discussed here, here, here and here), drug prices have little to do with production costs.

Most R&D for new drugs is performed by academic institutions or by the government at the National Institutes of Health. The vast majority of “new” drugs are not actually new but are slight modifications of old drugs designed in such a way as to extend the life of their patents and fend off encroachment by cheaper generic drugs.

There are also the “me-too” drugs, slight variations by different drug companies in order to capture a share of the market. We now have six statins on the market to lower cholesterol all of which are variations of the first to be developed – Mevacor, Lipitor, Zocor, Pravachol, Lescol and Crestor.

Such phony tributes to “free choice” are in reality a waste of resources whose sole purpose is to make money for Big Pharma.

Dr. Sharon Levine, associate executive director of Kaiser Permanente Medical Group put it this way: “If I’m a manufacturer and I can change one molecule and get another twenty years of patent rights, and convince physicians to prescribe and consumers to demand the next form of Prilosec, or weekly Prozac instead of daily Prozac, just as my patent expires, then why would I be spending money on a lot less certain endeavor, which is looking for brand-new drugs?”

As a result little effort is put into finding effective flu drugs or new antibiotics because there is little money in it.

An example of the encouragement of chemical dependency of the American people is the marketing of the chemically induced hard-on drugs such as Viagra, Cialis and Levitra. And from the pharmaceutical corporations point of view, it’s not enough to condition American males to take a drug every time they have sex, but it was important to transition them to taking the drug on a daily basis so that they they will always “be ready when the moment is right”. But Big Pharma’s rationale is not hard to fathom – they want American males addicted and dependent on their pill in order to feel confidant enough to have sex. It’s a billion dollar industry.

India Continues to Manufacture Cheaper, Generic Drugs Despite Pressure from Big Pharma

Generic drugs are drugs that are identical to brand name drugs and usually sell for a fraction of the price. They can be sold after patent protection on the brand name drug runs out – usually after 12 years. India is the leading manufacturer of generic drugs selling them to poorer, developing countries.  For example, Thailand has imported millions of doses of a generic version of the blood-thinning drug, Plavix  (used to help prevent heart attacks), at a cost of 3 US cents per dose, from India.

A recent ruling by the Supreme Court of India ensures that India will be able to continue to manufacture generic drugs and sell them to developing countries. Before it went generic in the US Plavix was costing consumers $200. a month or almost $7.00 a dose.

India exports about $10 billion worth of generic medicine every year. India and China together produce more than 80 percent of the active ingredients of all drugs used in the United States. So why should they adhere to US style patent protections when they are actually making the ingredients for the drugs which are not even manufactured in the US?

A New York Times article states:

“Specifically, the decision allows Indian makers of generic drugs to continue making copycat versions of the drug Gleevec, which is made by Novartis. It is spelled Glivec in Europe and elsewhere. The drug provides such effective treatment for some forms of leukemia that the Food and Drug Administration approved the medicine in the United States in 2001 in record time. The ruling will also help India maintain its role as the world’s most important provider of inexpensive medicines, which is critical in the global fight against deadly diseases. Gleevec, for example, can cost as much as $70,000 a year, while Indian generic versions cost about $2,500 a year.”

While India has been fighting to produce generic lifesaving drugs cheaply, Big Pharma, on the other hand, has been lobbying for the stricter patent protections (and hence higher profits) that they currently have in the US. The rest of the world is not buying it, fortunately.

Now Big Pharma wants the US government itself to lobby other countries for stricter patent protection. And why not? Big Pharma gets its way in the US by lobbying Congress. It would just be an extension of the role of the US government to let itself be used as a lobbying tool with respect to other countries.

India is on to the fact that most US drugs under patent protection are slightly altered versions of previous drugs whose patent protection has run out. Sometimes only one molecule has been altered. India is not buying the fact that these drugs deserve patent protection. The US government though has bought this argument hook, line and sinker. That’s why customers in the US pay through the nose for their prescription drugs.

Anand Grover, a lawyer who argued the case on behalf of Cancer Patients Aid Association in India, said that India would prefer to save lives rather than allow US corporations to make higher profits. “What is happening in the United States is that a lot of money is being wasted on new forms of old drugs,” Mr. Grover said. Because of the Indian Supreme Court ruling, “that will not happen in India.”

A majority of drug patents given in the United States are for tiny changes that often provide patients few meaningful benefits but allow drug companies to continue charging high prices for years beyond the original patent life. Take AstraZeneca, for example, which extended for years its franchise for the huge-selling heartburn pill Prilosec by slightly altering the chemical structure and renaming the medicine Nexium.

Other countries are wising up to the malignant policies of Big Pharma which maximizes its profits by having the ingredients for its high priced drugs made in Asian sweatshops while seeking to charge other countries the outrageous prices it charges its US customers under the veil that it needs to charge these prices in order to continue with research and development on new drugs.

But the fact of the matter is that it does little research on new drugs; that is undertaken by academics and the US government. Big Pharma uses its money to advertise on TV and to try and get as many Americans as possible dependent on prescription drugs.

The real question is why US citizens should stand for paying high prices, that have nothing to do with manufacturing costs, to Big Pharma. In some cases these prices are totally extortionary. It’s “your money or your life” for cancer drugs in particular.

This maximization of profits for lifesaving drugs represents one of the worst excesses of capitalism. It represents one of the worst aspects of the capitalistic ethos that nothing will be or should be done to benefit mankind or society unless it is done for profit. That people will only be helped if there is a profit motive for doing so. This is what Ronald Reagan and Ayn Rand preached – that no good shall be done unless it is done for profit. This is totally contrary to the Christian ethic of helping those in need regardless of profit.

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John Lawrence

John Lawrence graduated from Georgia Tech, Stanford and University of California at San Diego. While at UCSD, he was one of the original writer/workers on the San Diego Free Press in the late 1960s. He founded the San Diego Jazz Society in 1984 which had grants from the San Diego Commission for Arts and Culture and presented both local and nationally known jazz artists. John received a Society of Professional Journalists, San Diego chapter, 2014 award. His website is Social Choice and Beyond which exemplifies his interest in Economic Democracy. His book is East West Synthesis. He also blogs at Will Blog For Food. He can be reached at j.c.lawrence@cox.net.

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