Public Ranks Drug Industry at Bottom With Oil, HMOs, Tobacco_Harris Poll

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> JustSayNo

> Sat, 10 Jul 2004 01:30:00 -0000

> [sSRI-Research] Public Ranks Drug Industry

> at Bottom With Oil, HMOs, Tobacco_Harris Poll

>

> The New York Times reports: " No industry has fallen

> as far or as fast

> in public esteem in recent years as the

> pharmaceutical industry,

> according to the Harris Poll. "

>

> The American public is repelled by this industry's

> corrupt practices

> and unconscionable price gouging.

>

> According to the Harris Poll " respondents who say

> they have a

> positive attitude about the pharmaceutical industry

> has fallen 35

> points since 1997, more than for any other industry.

> Drug makers now

> share the bottom of the rankings with oil, managed

> care and tobacco

> companies. "

>

> The Times reports: " The industry's growing

> unpopularity has caught

> many executives off guard. " This validates

> Congressman Gutknecht's

> conclusion: " The pharmaceutical companies are living

> in a fool's

> paradise.They cannot continue to expect to enjoy

> free market pricing

> in what is, in reality, a captive market. "

>

> To the surprise of pharmaceutical executives, who

> fully expected that

> the promotional fairy tale ads concocted by their PR

> firms would

> protect their profit margins and approval ratings,

> this industry's

> corrupt practices have finally aroused public wrath.

>

> Drug manufactures are being called to task for

> setting highest price

> on essential, life-sustaining drugs those who need

> them to live,

> cannot afford; for concealment of evidence linking

> drugs to hazardous

> effects; for deceiving physicians with false claims

> and partial

> evidence to prescribe drugs whose safety and

> effectiveness is in

> doubt; for fraudulent marketing of ineffective,

> hazardous drugs; for

> using inordinate political influence to craft

> protectionist laws that

> hold the American public hostage to exorbitantly

> priced drugs.

>

> Even Merc's former, chairman, Roy Vagelos, condemns

> drug makers for

> the " exorbitant " prices of new medicines and

> " galloping " annual

> increases of old ones. He predicts, government price

> controls " are

> almost inevitable. "

>

> The Times reports that PhRMA has embarked on " a

> charm offensive to

> try to win back the nation's affection. " We doubt

> they will succeed

> in fooling the American people with distractions

> and penny give-a-

> ways and thousand dollar take-a-ways. The American

> public realizes

> that the Medicare prescription drug program was

> cooked up to ensure

> the drug industry a captive market with no

> competitive bidding, and

> a steady flow of taxpayer funds.

>

>

> Contact: Vera Hassner Sharav

> Tel: 212-595-8974

> e-mail: veracare

>

>

>

http://www.nytimes.com/2004/07/08/business/08drug.html?

> pagewanted=print & posi

> tion=

> THE NEW YORK TIMES

> July 8, 2004

> Drug Companies Seek to Mend Their Image

> By GARDINER HARRIS

>

> With drug prices skyrocketing, the pharmaceutical

> industry has long

> had plenty of critics. And in a measure of just how

> badly tarnished

> the industry's image has become, even some of its

> most prominent

> defenders are turning against it.

>

> That could spell trouble, which is why the drug

> industry is about to

> begin a charm offensive to try to win back the

> nation's affection.

>

> Roy Vagelos, the well-known former chairman of Merck

> & Company and

> one of the industry's most prominent boosters, now

> condemns drug

> makers for the " exorbitant " prices of new medicines

> and " galloping "

> annual increases of old ones. Government price

> controls, he predicts,

> are almost inevitable.

>

> " This industry delivered miracles, and now they're

> throwing it all

> away, " Dr. Vagelos said. " They just don't get it. "

>

> No industry has fallen as far or as fast in public

> esteem in recent

> years as the pharmaceutical industry, according to

> the Harris Poll.

>

> Acknowledging its dismal public standing, Pfizer,

> the nation's

> largest drug company, held a news conference on

> Wednesday to announce

> an effort to provide discounted drugs to the working

> poor and anyone

> without health insurance.

>

> It was the first of what is expected to be a blitz

> of similar

> announcements this summer from drug companies

> worried that their

> unpopularity could lead Congress to pass legislation

> that might

> legalize drug imports or allow government officials

> to bargain for

> discounts - either of which could put a big dent in

> the industry's

> profits and investments.

>

> Pat Kelly, president of Pfizer's American drug

> division, said that he

> was painfully aware of polls showing that Americans

> view drug and

> cigarette makers similarly. " We find it quite

> incredible,'' Mr. Kelly

> said, " that we could be equated with an industry

> that kills people as

> opposed to cures them. "

>

> In a series of presentations, executives at Pfizer,

> which is based in

> New York, said yesterday that they were starting the

> discount

> program - whose cost will not significantly affect

> the company's

> profits, they said - because it was the right thing

> to do. The

> company played videotaped addresses from Senators

> Charles E. Schumer

> and Hillary Rodham Clinton, both Democrats,

> applauding its efforts.

>

> Whether the new program and yesterday's fanfare will

> halt the slide

> in the company's standing with the public or slow

> legislation on

> Capitol Hill that the industry opposes is uncertain.

> Two years ago,

> Pfizer and most other major drug makers announced

> programs to provide

> free or nominally priced drugs to the poor.

>

> The clutter of disparate efforts led to confusion.

> The industry's

> poll numbers continued to decline.

>

> The main reason for the industry's unpopularity,

> pollsters say, is

> that Americans, increasingly aware that drugs are

> much cheaper

> elsewhere, are tired of digging ever deeper to pay

> for prescription

> medicine.

>

> The cost of the drugs needed to treat colon cancer,

> for instance, has

> soared to $250,000 from $500 for the regimen of

> 1999. Prices for the

> most commonly used branded drugs rose 28 percent

> from 2000 to 2003,

> nearly three times the rate of inflation, according

> to AARP.

>

> During that time, Bristol-Myers Squibb raised its

> prices for Plavix

> and Pravachol, popular heart medicines, by 35

> percent. Prices this

> year are rising even faster, AARP found.

>

> Patients say they fear that they may soon face a

> stark choice - their

> money or their lives.

>

> " I see no silver lining to the dark cloud of the

> drug industry, " said

> Gary Schmidgall, a 59-year-old English professor

> interviewed recently

> while he shopped in an Upper West Side supermarket.

>

> Robert Wittes, a former Bristol-Myers Squibb

> researcher who is now

> physician in chief at Memorial Sloan-Kettering

> Cancer Center, said

> that the industry's skyrocketing prices " invite

> government price

> controls " and leave needy patients stranded.

>

> " They are daring the politicians to act, daring the

> payers to act,''

> Dr. Wittes said. " They are making life very

> difficult for patients

> and institutions who want to act responsibly. "

>

> The industry had expected critics to be mollified by

> last year's

> passage of the Medicare drug bill, which provides

> for tens of

> billions of dollars from the government to pay drug

> costs for the

> elderly who are not poor. That has not happened.

>

> So executives undertook what some hoped would be an

> extreme makeover.

> A committee of top executives chaired by Karen

> Katen, president of

> Pfizer's pharmaceutical group, are meeting regularly

> to discuss how

> to improve the industry's image.

>

> The committee is focused on " improving access and

> affordability of

> drugs, " Ms. Katen said. She said they would soon

> announce the

> conclusions and declined to discuss it further. But

> a participant

> said to expect initiatives similar to Pfizer's,

> aimed at providing

> drugs for the uninsured and increasing awareness of

> the industry's

> free drug programs.

>

> If yesterday is any guide, the reception for the

> efforts will be

> mixed.

>

> Within hours of Pfizer's announcement, the Medicare

> Rights Center

> released a statement saying Pfizer's program " will

> help only a small

> fraction of those in need. "

>

> The pharmaceutical industry earns nearly two-thirds

> of its profits in

> the United States since drug prices in the rest of

> the industrialized

> world are largely government controlled. Those

> profits rely almost

> entirely on laws that protect the industry from

> cheap imports, delay

> home-grown knockoffs, give away government medical

> discoveries, allow

> steep tax breaks for research expenditures and

> forbid government

> officials from demanding discounts while requiring

> them to buy

> certain drugs.

>

> But Congress, prodded by unhappy constituents, is

> becoming restive.

> To begin with, proposals to legalize drug imports

> and to allow

> government health officials to negotiate discounts

> are proliferating.

>

> In the past, lawmakers, typically from the

> Republican Party, led the

> effort to protect the industry from such proposals.

> But now, some

> conservative Republicans are among the most vocal

> backers of the

> bills.

>

> Representative Gil Gutknecht, a conservative

> Republican from

> Minnesota, has called the drug industry greedy and

> has been pushing

> to legalize imports.

>

> " The pharmaceutical companies are living in a fool's

> paradise, " Mr.

> Gutknecht said recently. " They cannot continue to

> expect to enjoy

> free market pricing in what is, in reality, a

> captive market. "

>

> While nothing is expected to emerge from Congress

> anytime soon,

> executives say that they have reason to worry.

>

> To forestall government intervention, said Raymond

> V. Gilmartin, Dr.

> Vagelos's successor as Merck's chief executive, the

> industry must do

> more to prove the value of its medicines. " We also

> have to become

> more efficient, " he said, " and drive down our cost

> structure. "

>

> The industry's growing unpopularity has caught many

> executives off

> guard.

>

> Most say they see themselves as dedicated to the

> public good and

> committed to finding cures, an image increasingly at

> odds with those

> held by the rest of the country.

>

> John Landis, senior vice president for

> pharmaceutical sciences at

> Schering-Plough, said he attended a cocktail party

> at a college last

> year that was filled with scientists.

>

> " You would think that a party with scientists and

> their wives would

> be a friendly, safe gathering, " Dr. Landis said.

> " But the

> conversation quickly got around to why the costs of

> medicine are so

> high, why does the drug industry spend so much on

> marketing and why

> is there greater access to medicines outside of the

> United States. "

>

> Dr. Landis explained that drugs were difficult to

> discover and

> expensive to research. His audience was not

> convinced. " I finally had

> to say, 'Soooo, how about that football game?' ''

>

> The share of Harris Poll respondents who say they

> have a positive

> attitude about the pharmaceutical industry has

> fallen 35 points since

> 1997, more than for any other industry. Drug makers

> now share the

> bottom of the rankings with oil, managed care and

> tobacco companies.

>

> Just 13 percent of poll respondents described

> pharmaceutical

> companies as " generally honest and trustworthy. "

> Some 57 percent said

> that drug prices are " unreasonably high " and an

> equal share said that

> the drug industry should be more regulated by the

> federal government,

> even though 7 percent said that they found it " very

> difficult " to pay

> for drugs.

>

> Marcia Donen, who lives on the Upper East Side, said

> that the price

> of her 16-year-old daughter's asthma inhaler went

> from $80.59 in

> December 2002, to $177.99 last June, to $203.99 a

> few days ago. The

> inhaler, called Maxair, is made by 3M.

>

> " I couldn't believe it, " Ms. Donen said. " You need

> this to live. This

> is why people are going to Canada for drugs. "

>

> John Cornwell, a spokesman for 3M, said that the

> company increased

> Maxair's price by almost 10 percent in each of the

> last three years,

> because the increases " were important in order for

> 3M to continue to

> make this product. "

>

>

> Pharmacies or wholesalers may have accounted for any

> increases beyond

> that, Mr. Cornwell said.

>

> Stories of large price increases tend to crystallize

> negative

> sentiment against the industry. When Abbott

> Laboratories decided late

> last year to quintuple the price of its H.I.V. drug,

> Norvir, AIDS

> activists mobilized.

>

> The price increase led to a hearing by the National

> Institutes of

> Health on whether to allow generic versions of the

> drug on the market

> years before its patent expires.

>

> Erbitux, a cancer drug from Bristol-Myers and

> ImClone Systems, costs

> up to $30,240 a patient. Treatment with Avastin,

> another drug for

> cancer from Genentech, costs $46,640.

>

> Bristol-Myers and Genentech explained that the

> prices take into

> account costly research and manufacturing expenses.

> But Dr. Vagelos

> and Dr. Wittes said that the prices of the two

> medicines are

> inexcusable.

>

> In the short-term, most patients who need Erbitux or

> Avastin and are

> insured will be able to get them by paying

> relatively modest co-

> payments, said Joseph Raduazzo, medical director of

> pharmacy programs

> at Tufts Health Plan.

>

>

> But as more such drugs are introduced, something is

> going to give, he

> said. " We're going to have to find a way of

> rewarding the

> pharmaceutical companies for developing these drugs

> in a more

> rational way, " Dr. Raduazzo said.

>

> But for now the industry remains so unpopular that

> Andrew Sandler, a

> cancer researcher for Berlex Laboratories, cannot

> persuade even his

> 68-year-old mother that drug prices are reasonable.

>

> " I tell her that we need that money to invest in

> research, " Dr.

> Sandler said of his frequent phone conversations.

> " She listens, but

> I'm sure she's rolling her eyes.''

>

>

> Copyright 2004 The New York Times Company |

>