The Last Word - Forget the bathwater and save the baby
I’m not the kind of person who wishes ill on others; but when I read the latest bashing of pharma and the Orphan Drug Act, I’m tempted to wonder what tune the authors would sing if they were diagnosed with a rare disease. Consider a recent piece in the New York Times by Steven Rattner, “An Orphan Jackpot.” Instead of marveling at the amazing job pharma has done in developing life-enhancing drugs for uncommon conditions, Mr. Rattner complains that the industry is making a profit.
You’d think that pharma was the only industry that has the gall to want to be paid for its products. And not just that – it even has the nerve to hire accountants to study the IRS codes and lower its taxes. It actually hires lobbyists!
Pharma detractors like Mr. Rattner not only dwell on what they hate about our industry, but they also suffer collective amnesia about the good. How else can you explain why they never mention that 20th and 21st century medicine has extended our collective lifespans by decades?
And why in heaven’s name would anyone disparage the Orphan Drug Act, arguably one of the best pieces of pharmaceutical legislation ever enacted? Passed by Congress and signed by Ronald Reagan in 1983, the Orphan Drug Act has been copied around the world, with one nation after another passing its own version tailored to its individual needs and population. As you probably know, the impetus behind the ODA was not because pharma was “ignoring” rare diseases (as some suggest), but because Federal regulations and patent laws had made the development of drugs for uncommon conditions financially unfeasible.
Pharma opponents like Mr. Rattner point out that some orphan drugs generate large profits because the company has an exclusive right to the indication and can therefore charge whatever they wish. To this I’m tempted to say, so what? But even if you agree, this “problem” is easily addressed.
For example, some countries have enacted a provision that if an orphan drug earns a defined level of profits after a certain number of years, the exclusivity period or financial incentives are adjusted. No big deal. In fact, the U.S. Congress passed such an amendment to the Orphan Drug Act a few years ago; but President George W. Bush cast a veto. Was he right or wrong? I’m sure there were merits on both sides of the case, but the important fact is that whatever glitches you can identify in the Orphan Drug Act, they are fixable and zilch compared with the overall value it adds to society.
Perhaps the bashers’ most shameful tactic is how they belittle the drugs themselves. For example, Mr. Rattner mentions Xyrem, which he calls a “good drug,” but then delivers a backhand slap, noting that it “doesn’t cure any deadly disease or even directly prolong life.” No, Xyrem only treats narcolepsy – which merely compromises a patient’s ability to drive a car, hold a job, or function in society. No big deal!
And for that, Mr. Rattner complains, the manufacturer, Jazz Pharmaceuticals, charges a whopping $65,000 a year! Who can afford that? Think of all those people who are deprived of the drug! But as Mr. Rattner eventually admits: “Nearly every patient gets the drug pretty cheaply – Jazz subsidizes co-payments above $35 per month – so few users care what Jazz charges.”
What’s that? Well, if the patients aren’t upset, the insurance companies must be up in arms. But it turns out, they aren’t either. The cost of orphan drugs may seem exorbitant to the indignant press, but to most payers, they’re manageable because of the small sizes of the patient population (not to mention the benefit they deliver.)
So who’s really angry about Xyrem? Mr. Rattner.
But forget about Xyrem – many of the orphan drugs in the “orphan jackpot” actually do prolong life. Do you know anyone with MS? Or leukemia? How about multiple myeloma? You’ve certainly heard the names. Geraldine Ferraro courageously fought multiple myeloma for years with the aid of orphan drugs like thalidomide. Montel Williams and others with MS have used injectable orphan drugs like Avonex, Rebif, and Tysabri to slow disease progress and control symptoms. And now a new generation of oral MS drugs may bring even more hope.
These drugs would never have been possible without the Orphan Drug Act. Mindless criticism of this legislation is not only unfair but reckless. Despite popular belief, legislators do read the papers. In the last few years, complaints about government waste led to the gutting of the NIH and a massive shutdown in scientific research. Tomorrow, orphan drug development could face the same fate. I wish that Mr. Rattner and his colleagues would take a few moments to realize that someday they, or a loved one, may be facing a rare disease – and that it may be their turn to pray that pharma can come through with a treatment in time. So, please just dial down the dialogue a bit. Let’s save the baby.
Sander Flaum is prinicpal, Flaum Navigators, and chairman, Fordham Leadership Forum, Fordham University Graduate School of Business Administration.
Posted: September 2013