Want Healthcare Reform That Works? Get Rid Of Patents

from the and-watch-innovation-flow dept

Economist David Levine (author of the book Against Intellectual Monopoly) has a column up at the Huffington Post, where he explains why abolishing pharma patents would be a great way to reform healthcare. He runs through many of the arguments against such a move, and explains why they don't make much sense:

But, perhaps, without all those extra monopoly profits we wouldn't have such great new products? The fact is there aren't so many great new products - a well known fact among health economists is that while big pharma's spending has soared the last decade, as patent control has tightened, drug discovery has plummeted. Pharmaceutical innovation is not lower in Europe, despite of big pharma's lower monopoly profits. While the market for pharmaceuticals is now largely a global one, so local rules may not be so important, this was less true in the past. Historically, before pharmaceutical patents were introduced in Italy in 1978, that country accounted for about 8% of new pharmaceutical discoveries worldwide. After the industry was strangled by patents, that percentage dropped to practically zero. Switzerland, a powerhouse in the world drug industry, introduced pharmaceutical patents at about the same time. While Switzerland's fall has not been as dramatic as Italy's, it too is much less of a powerhouse today than it was before 1977.

Patents do not seem to lead to the innovation their proponents claim. The list of examples goes on and on: the discovery of the one-dose HIV cocktail that replaced the complicated multi-pill regime? That took place in India a country that at that time did not allow pharmaceutical patents. Of the fifteen great medical milestones recently identified by the British Medical Journal - only two were patented or could be attributed to the "incentive" that patents supposedly provide. Numerous technical studies by economists of the effect of stronger patents on innovation have failed to find any consistent increase. Put it plainly: while the social gains from abolishing patents on drugs are obvious and computable, the losses are dubious and, on the basis of empirical evidence, probably nil.

Pharmaceutical patents and the resulting monopolies have many other corrosive effects, over and above raising the prices of prescription drugs. Pharmaceutical companies spend far more money promoting their products than on R&D. Some of the giants spend as much as four times on marketing as they do on research and development. How do these companies market their products? Most of the money goes to "scientifically convincing" the medical profession to prescribe patented products. How? Well, for example, by inviting doctors and their families to week-long conferences in exclusive resorts, where two hours are for a marketing presentation (the "medical symposium") and the rest for (all-included) leisure. A spectacular - but hardly unique - example of the level of corruption is the conviction of Pfizer for encouraging doctors to bill the government for drugs they were provided for free. These practices not only raise the cost of drugs, but corrode trust in the medical profession.

He also goes on to suggest some other ways to lower the costs of "drug development," as well. There's probably not much new in there if you've read his book, but it's a good, straightforward description of the problem with pharma patents. While the writing is a bit flippant, if you go through the related chapter in Levine's book, and then start reading some of the other source material and studies, it's all backed up quite strongly. There's almost no evidence that patents do anything to promote more drug discovery -- and plenty to suggest it makes medicines significantly more expensive. Ditching pharma patents would make a much more efficient market in drugs that would end up saving a lot of lives.

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Only 8% Of Journalist Coverage Of Healthcare Debate Is Actually About The Healthcare System

from the and-they-want-us-to-pay-for-this? dept

One of the mantras of journalists who insist that paywalls will work, or that the world needs professional journalists is that they do such important work informing the public. And, certainly, sometimes that's true. The problem is that it's so rare. Jay Rosen points us to a report from the Columbia Journalism Review, where it notes that very little of the reporting on what to do about the healthcare system is actually about the healthcare system. Instead, it's mostly reporting on the chatter about the healthcare system:

The Project for Excellence in Journalism, for example, found that so far this year 55 percent of coverage of health care has been about the political battles, 16 percent about the protests, and only 8 percent about substantive issues like how the system works now, what will happen if it remains unchanged, and what proposed changes will mean for ordinary people.

In other words, the press is spending more time on the fighting, rather than on the substance. It's filler and fluff -- that often misleads and distracts from the actual discussion. And we're supposed to value that? There's a tremendous need for thoughtful discussions about healthcare, and it's a spot where professional journalists could be a huge help. But, it's a lot easier to just focus on the play-by-play commentary, rather than actually adding value.

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The Placebo Effect: Things Pharma Prefers You Not Worry About

from the here,-take-this-sugar-pill dept

There's a fascinating article in the latest issue of Wired about the placebo effect and pharmaceutical companies. It's fascinating for a few reasons: First, because it shows the thought process of pharma firms and why "what's best for pharma" is often not what's best for your health (which is a line often trotted out by those who believe in protecting pharma). Second, because it suggests that some (potentially significant) parts of pharmaceutical science -- the stuff we hear over and over again is so important to protect via patents -- is bunk. And, finally, just because it may surprise you to know just how powerful the placebo effect appears to be -- and that it's only getting stronger.

The critical point is that final one. Basically, the placebo effect (the impact had on a patient taking a sugar pill under the false impression that it's medicine) seems to be quite real and, at times, quite powerful and lasting. Even more surprising is that, over time, the placebo effect has only become stronger and stronger.

Now, if pharmaceutical companies were actually interested in your health, then this would be a ripe area of study, well worth exploring to see if the placebo effect could be better understood and somehow harnessed to make people healthy. But, of course, you can't patent a sugar pill, so pharma research dollars have gone into drugs that can be patented.

However, a serious problem has arisen: with the placebo effect getting stronger and stronger, these "wonder drugs" that pharma has been spending millions of dollars "developing" have increasingly been failing clinical trials, because they can't out-perform placebos. The theory behind testing against placebos is that if a drug doesn't outperform the placebo, you have to question what good the actual drug is and why it should be approved. So, if a drug fails to outperform a placebo, then (the thinking goes) the drug is useless. But that's partly based on the idea that the effect of taking a placebo is weak.

This leaves out an important part of the equation: If the placebo is really effective in dealing with certain issues, then why not examine how to utilize that fact to make people healthy? Some in the pharma world have been pushing for this for a long time, and have repeatedly asked the big pharma companies to release their data on clinical trials, in order to better understand the impact of placebos and to see if there's a way to harness their power. But the pharma companies have resisted and don't want to release the data -- in part because they're scared to death of what this all means. If sugar pills are effective, that's a very different business, and the claims of all of the drugs that are on the market would be called into serious question. Instead, they've apparently spent their time writing out detailed marketing plans that convince doctors to prescribe medicine that doesn't work any better than alternatives.

Now, let's be quite clear here: I am not saying that drugs don't do any good. There are plenty of pharmaceuticals that certainly help deal with certain conditions, and there are plenty of people who lead better lives (or are alive at all) solely because of modern medicine. But, these findings about the placebo effect certainly suggest that -- at least in many cases -- rather than dumping chemicals into the human system via a pill, your brain may actually be a lot more effective at concocting the proper chemicals itself.

If we had a healthcare system built on incentives to actually keep people healthy -- rather than just to sell more pills -- this would be the beginning of a very important field of study. Instead, it's been resisted and the data has been hidden away for years.

The incentive system is clearly screwed up. It's based on patents and hoarding information, rather than on actually keeping people as healthy as possible. If you could craft a healthcare system that actually rewards those who keep patients healthy, then perhaps we'd actually know a lot more about the placebo effect and, beyond it, our own brains' ability to produce important, potentially life-saving or life-improving chemicals on its own. In fact, in such a system, the incentives would be less about hoarding information, and more about sharing it, since, through collaboration, it would be more likely that more people could be kept healthier, allowing greater overall profits. The problem today is that the system is based on incentives that are misaligned... and thus, it's a struggle to get anyone to care about the fact that the placebo effect actually seems to help some people.

Update: As pointed out in the comments, Skeptic Magazine recently had an article that provides some more thoughts on placebos.

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Even The Pope Is Worried About The State Of Intellectual Property

from the didn't-see-that-coming dept

The US Constitution clearly states that the sole purpose of intellectual property monopolies is "to promote the progress of science and the useful arts." For quite some time, we've felt that current intellectual property law does not live up to that challenge... and it appears that, of all people, the Pope may agree. Pope Benedict XVI is certainly not subject to the US Constitution, but Roberto Valenzuela alerts us to the Pope's "Caritas in veritate" (Charity in Truth) that just came out today. In it, the Pope discusses what is progress and the importance of economic development, which makes for quite an interesting read, whether you are religious or not. The Pope talks about how economic development, prosperity and economic growth has helped lift many out of poverty and built up nations and created tremendous opportunities for people. However, he is worried about "malfunctions and dramatic problems" in the system. Such as? Well, intellectual property for one thing:

On the part of rich countries there is excessive zeal for protecting knowledge through an unduly rigid assertion of the right to intellectual property, especially in the field of health care

While there's plenty that I don't necessarily agree with, a lot of the talk certainly does appear to be pretty economically literate, suggesting that an overabundant focus on short term profits can do significant harm to long-term economic growth. He talks up the importance of increasing knowledge and research and better sharing the results of that research.

The impact of technology is a constant theme throughout the entire thing, with an entire section focused on technology towards the end, where he does worry that our fascination with technology its own sake often obscures the its overall impact. He talks about the responsible use of technology, but (and perhaps I'm reading too much into it) he doesn't appear to be condemning technological progress, but noting that for its gains to be sustainable, people do need to think about the wider impact. However, I certainly disagree with his assessment that technology for things like social communications can have a direct moral implication, as opposed to being "neutral."

It's a worthwhile (if long) read, no matter where you stand on these issues -- but the very fact that even the Pope is concerned about the excesses of intellectual property being used to harm economic and social development again suggests that this is a problem that is having a pretty wide impact.

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Another Example Of Patents Putting Lives At Risk

from the very-sad dept

This one's a bit old, but I finally got around to reading Joe Mullin's fascinating, but troubling, account which pits a Stanford professor and doctor against a French company, Advanced Biological Laboratories, that claims to own patents on (effectively) using computer data to help doctors make diagnostic decisions. If you want to see the specific patents, they are 6,188,988 and 6,081,786. At issue, is the fact that Dr. Bob Shafer has been working for years (actually, since before either patent was filed) on putting together HIVdb, an exceptionally useful database on HIV details that many researchers rely on to help figure out potential treatments to HIV. Except... of course, ABL claims that it infringes on those patents.

Since Dr. Shafer works for Stanford, ABL threatened Stanford, who brought in some lawyers who pointed out that the patents had very little chance of surviving any sort of review -- but Stanford, apparently anxious to avoid a long, drawn-out or costly lawsuit, agreed to settle the dispute, promising to put a warning note on HIVdb that using the system for commercial purposes might require a license from ABL. Shafer, who didn't know such a settlement was in the works, was quite upset to find out about it -- and refused to put the warning message on the site (eventually he put an edited version, hidden deep within the site, including his own opinion about how silly it was).

Shafer also has hired his own lawyer and is pushing forward to invalidate ABL's patents. He's also been learning more and more about how such patents are all too often used against their stated purpose, and how, rather than encouraging innovation, they're being used to stifle it and (more importantly) to put lives at risk. Shafer and his colleagues are reasonably horrified that Stanford gave in, noting that it only encourages such behavior, and enables ABL and others to pull the same sort of stunt against others.

Given that Shafer refused to live up to the terms of the deal that he had never agreed to in the first place, ABL moved forward and sued Shafer directly, and that case is now ongoing -- even as Shafer hopes to invalidate the patent through the Patent Office itself. The whole thing is yet another story of how patents are being used to stifle innovation -- and sometimes put lives at risk. It's tragic that we've been seeing so many such stories lately. Update: It's been pointed out that some of you might want to look at the great website Shafer has put together, at HarmfulPatents.org if you want to learn more.

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Is Net Neutrality Going To Kill You?

from the be-very-afraid dept

Techdirt does not have much of a history of awarding plaudits to Sonia Arrison. But this time we at least have to give her points for originality: in her latest essay opposing net neutrality she advances the indisputably original argument that net neutrality will kill you.

Well, alright: that's a bit hyperbolic. But she does think that net neutrality legislation could lead to clogged networks that make pervasive health-monitoring applications unsafe, or at least untenable:

Technology like RFID tags connected with wireless networks can help create an "always on" health monitoring system, thereby transitioning society away from a "mainframe" medical model and redirecting it toward a smaller, more personalized, PC-type model. This is a great idea, yet the unspoken truth is that this type of communication requires healthy, innovative networks. That raises a key question about Net neutrality, an issue spun and respun by many.

It's a neat trick, presuming that "non-neutral" and "healthy" are synonymous. But leaving aside that sleight of hand, Ms. Arrison's position ignores an area where regulated networks have historically excelled: providing a minimal but guaranteed level of service. The telephone system's better-than-five-nines level of reliability emerged while Ma Bell was at her most closed and monolithic. The ubiquity of the E911 system is the product of a federal mandate. And the highly-regulated public broadcast spectrum rarely sees dead air.

The best arguments that net neutrality opponents have advanced concern the future of the network, not its present state. They maintain that treating a packet differently based on its business pedigree rather than its functional characteristics will ensure a competitive marketplace that provides new network services -- more bandwidth and lower latency -- and keeps prices low. Whether or not you agree with this conclusion, these posited advantages are exactly what low-bandwidth, latency-insensitive health monitoring systems don't need.

That isn't true of telerobotic surgery, of course, and that application is the other healthcare case that Arrison considers. And although she inexplicably implies that using the public network for it would be anything other than lunacy, she at least acknowledges that dedicated links can and likely would be used by hospitals for this sort of work. But then Arrison bizarrely notes that net neutrality legislation could cripple these privately-owned networks, too.

In 2001, professor Jacques Marescaux, M.D. and his team performed the first clinical robot-assisted remote telepresence surgery, operating on the gallbladder of a patient in Strasbourg, France -- 4,000 miles away from their location in New York. What this type of procedure means to remote patients is life-changing, yet such an operation requires a stable and well-managed network, free from the binding hands of politics. Even if the doctors are using a dedicated network, it is still affected by whatever rules bureaucrats place on network operators as a whole.

I suppose this disastrous outcome is a possibility -- but only in the sense that net neutrality legislation would also be a bad idea if it mandated that ISPs only allow traffic related to Facebook gifts and chain emails, or that cablemodem speeds not exceed 56k. It's hard to imagine why legislators would do anything so daft. "Strengthening the case of anti-neutrality activists" is about the only reason I can come up with.

To be sure, there are real arguments to be made about the future of our networks and the appropriate role of the government, if any, in managing them. But net neutrality is not going to make you sicker.

Tom Lee is an expert at the Insight Community. To get insight and analysis from Tom Lee and other experts on challenges your company faces, click here.

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