Brazil and creativity regarding US cotton Subsidies.

[Kidlicious]

Originally posted by DinoDoc
The Brazilian market isn't that large for us. They'd just get ***** slapped in retaliation.

Yep. DD understands how the core semi-periphery relationship works.

[GePap]

Originally posted by Oerdin


There have only been 2-3 diseases eradicated ever in the history of the world and they've all been the same pattern type. Highly virulent but burning out quickly; that meant it was easy to contain those diseases. Diseases like AIDS and other viruses require complex cocktails in order to treat and universities don't have the funds to keep up with private research there. True, there is always a role for government and philanthropy but I already repeatedly acknowledged that. Didn't I?

NO. You state that corporate interest are the most important, but you fail to acknowleged the underlying obvious truth- only is a drug is likely to be profitable will it be created. Malaria is an obvious case of a huge killer which is unprofitable to cure currently. BUt impotence, or male enhancement, there we see billions invested. Universities and the government were crucial in making those drug cocktails work, and of course the government gives out its findings for free.

The basic point is that no private interest could EVER gather capital like the government.

Instead the question is what approach is most likely to lead us to a cure or at least life sustaining treatments? I'm not sure how Lula's plan to legalize software, music, and video piracy will help but it seems like he's just using the odd drug piracy to justify his grander theme of theft. This will not help Brazil, its economy, or the sick people in Brazil. Instead it will result in adverse consequences which will harm Brazil's economy and its ability to treat the sick.

The thing that would lead to a cure most rapidly would be for rich governments in the western world to devote say .5% of GDP towards medical research.

BUt the fact is Lula's actions will not lead to any of the problems you quote realisitcly. I doubt US and European consumers will all of a sudden flock to Brazil to buy drugs there, meaning the cash cows that keep western drug companies the most profitable businesses in the world will continue to rake in the dough to insure Americans are able t have satisfying long term erections. As for Music and movies, like Brazilians will see their society collapse if foreign entertainment all of s sudden isn;t there. I mean, its not like Brazilians can find ways to entertain themselves free of Hollywood, right?

Oh, and since when can the poor in Brazil actually afford the expensive drugs from western companies???

[GePap]

I am trying to compare investment into drugs by government and the private sector. Its not easy.

This is a report a decade old. I am not sure about fundamental changes since then. BUT it is a good summary of the business overall:

http://www.cptech.org/pharm/pryor.html

it's Summary:

Summary of Comments

Our comments today will address the following points.

* According to the National Institutes of Health, the federal government funds 42 percent of all national expenditures on health care research, compared to 47 percent from private industry.

* The federal government's role in the development of new drugs spans a wide range of activities, encompassing nearly all aspects of drug development, such as the discovery of new therapeutic agents, clinical testing of drugs in humans, and the development and refinement of manufacturing techniques. The notable exception concerns the final step of drug development, which is the request for an FDA New Drug Application (NDA), which is required before the drug can be commercially marketed.

* The federal government plays a particularly important role in the highest risk research projects, including basic research, where commercial payoffs are least certain.

* In the area of federal expenditures on human use clinical trials, a relatively advanced area for drug research, the National Institutes of Health (NIH) will spend an estimated $868.8 million in fiscal year 1993, a 75 percent increase over NIH's 1989 expenditures of $495.5 million. By comparison, the members of the Pharmaceutical Manufactures Association (PMA) reported spending $1,555 million in clinical trials in 1989 (the most recent year for which data are available).

* Federal support for the development of new drugs is focused on those drugs which represent the greatest gains in therapeutic value or which are used to treat the most serious illnesses.

* While the FDA approves hundreds of drugs for marketing every year, the number of new or important drugs is relatively small. In 1991 the FDA approved 327 new and generic drugs and biologic products. Thirty of the approvals were for new molecular entities (NMEs) -- drugs distinctly different in structure from those already on the market. Only five of these drugs received an FDA efficacy rating of A, which is reserved for drugs which afford "significant therapeutic gain." Nine of the NMEs received an FDA classification of E, which is reserved for drugs that treat "severely debilitating or life threatening illness," including four of the five Class A drugs. Two drugs received FDA Class AA priority status for the treatment of AIDS.

* All five 1991 FDA Class A drugs were developed with federal funds.

* Six of the nine 1991 FDA Class E drugs were developed with federal funds.

* Both 1991 FDA Class AA drugs for AIDS were developed with federal funds.

page 2

* For the group, seven of the ten 1991 FDA NME priority drugs (Class A,E or AA), were developed with federal funds.

* Among the FDA NME priority drugs approved in 1991, those that were developed with federal funding were priced considerably higher than those developed without federal funding.

* Drugs developed without federal funding were priced at $321 to $2,376 (based upon a full year or completed course of treatment, whichever was less).

* Drugs developed with federal funding were priced at $368 to $546,000 (based upon a full year or completed course of treatment, whichever was less).

* Among the seven priority drugs developed with federal funding, five were priced at more than $7,000 and only one was priced less than $1,000.

* The federal government has played an enormous role in the development of new cancer drugs. There have been 37 new cancer drugs discovered and approved for marketing since the National Cancer Institute's new drug program began in 1955. Of the 37 cancer drugs, 34 were developed with federal funding.

One firm, Bristol-Myers Squibb, has benefitted the most from the NCI new drug program. Of the 34 cancer drugs developed with federal funding, 11 are marketed by Bristol-Myers Squibb, including the recent blockbuster drug Taxol.

In comparing the relative contributions of the government and the private sector in the development of new drugs, it is important to recognize ways that industry spokesman manipulate the data. For example, studies of the industry's costs of developing new drugs typically adjust nominal expenditures for inflation, risk and the opportunity cost of capital. In contrast, the government's costs of drug development are frequently presented in nominal terms, without any adjustments for inflation, risk or the opportunity cost of capital. As a result, many observers have a grossly distorted view of the economic value of the government's drug research investments. For example, some studies report industry Phase I investments at 11 times the initial nominal cash outlays, while government agencies often report drug development costs that only reflect nominal cash outlays to contractors, and ignore the government's costs of intramural research.

While there is ample evidence that private sector prices for drugs are excessive, there is very little data available to the government to determine fair prices. It is easier to determine what is unfair than what is fair. In order to determine fair prices, the government needs better economic data on the pharmaceutical industry, including the costs and risks of development, manufacturing and marketing drugs, and it also needs to develop better methodologies for determining fair prices.

The recent attempt by NCI to determine a fair price for Taxol illustrates the primitive nature of NIH efforts in this regard. Taxol was discovered, manufactured and tested in humans by the National Cancer Institute. NCI gave Bristol-Myers Squibb (BMS) a Cooperative Research and Development Agreement (CRADA) that assigned to the firm the exclusive rights to commercialize all NCI past and future Taxol research. BMS, the NCI's favorite partner in drug development, paid nothing for the CRADA and will pay the government no royalties on its Taxol sales. However, BMS did agree to a "fair pricing" clause in the Taxol CRADA.

BMS's only contribution to the NDA approval for Taxol was to supply NCI with approximately 17 kilos of Taxol, and to process the paperwork for the NDA. When the NDA was approved in December 1992, BMS announced a price of $4.87 per milligram. The cost of a completed Taxol treatment will exceed $10,000 for some patients.

The Taxol price was the product of bizarre negotiations between NCI and BMS. NCI claimed that BMS simply refused to disclose any information on its development, research or marketing costs. NCI then gave BMS a list of the monthly wholesale prices for 15 arbitrarily chosen drugs and told BMS to price Taxol below the median for the group.

To consider the adequacy of the NIH's "fair pricing" methodology, consider the following facts. NCI was able to produce Taxol in small research quantities at $.60 per milligram prior to its 1989 agreement with BMS, using the same third party contractor as is used by BMS. According to the BMS contractor's recent filings with the Securities and Exchange Commission (SEC), it is under contract to produce approximately 400 kilograms of Taxol for BMS by August 1994, for which the firm expects to be paid $100 million. The wholesale value of 400 kilograms of Taxol, on the other hand, is $1.948 billion.

Since BMS is able to manufacture Taxol for about $.25 per milligram -- about 5 percent of the current wholesale price, the company's cost of providing 17 kilograms of Taxol to NCI for research purposes (which BMS owns the rights to) was less than $5 million.

In the face of criticism of the Taxol price from Representative Ron Wyden and the Taxpayer Assets Project, BMS claimed that it had made "huge" investments in the development of Taxol, which were in excessive $114 million. However, while the company refused to provide any accounting of where these "huge" expenditures had gone, the $114 million figure clearly was based upon BMS long term contracts to supply Taxol for manufacturing purpose, and not for the research costs of the drug, which were largely borne by taxpayers. Moreover, NCI's claim that it was denied access to the BMS data reflects its contempt for its responsibilities to determine fair consumer prices for government funded drugs. The fact that BMS refused to provide financial data to NCI was a regrettable but hardly unsurmountable obstacle. While NCI is not run by rocket scientists, a child with a fourth grade education and a pencil and paper could have easily estimated BMS's development and manufacturing costs from a review of publicly available SEC documents.

[Dinner]

Originally posted by GePap
NO. You state that corporate interest are the most important, but you fail to acknowleged the underlying obvious truth- only is a drug is likely to be profitable will it be created.

Which is where government and nonprofits come in; I've already acknowledged this. You know it, I know it, the readers know it.

Just comparing gross dollars from the pharma industry compared to government research grants and/or university funds will prove the private industry is THE big source of money when it comes to new drug research. Killing or even endangering or cutting back that pipeline isn't a smart move. Especially because some third world politician is getting pissy about first world subsidies.

[:) Smiley]

Brazil alone would lose against the US, but who knows this might give other governments ideas.

[Whoha]

"Malaria is an obvious case of a huge killer which is unprofitable to cure currently."

I am under the impression that DDT did some good in that area, both in profitability and performance.

AIDS would require a great deal of political will to deal with that just isn't there.

Polio wasn't erraticated. The muslims in Nigeria managed to preserve it saying that the vaccine "was an evil sterilization plot". It escaped Africa and showed up in Indonesia. We should have just vaporized those villages, again that would have meant having the political will required to do the job.

and back to the central issue, Bush has done nothing to protect other Intellectual property, so the likelyhood of this one causing a response is quite small. It is just going to increase the size and scope of the backlash when it finally does occur.

[GePap]

http://www.innovationlaw.org/pages/hollispaper.pdf

For Oerdin.

I recommend the paper.

It does a fair job, form the perspective of a defender of intellectual property, to show how the current drug market is a broken one.

Spending billions to reserach a drug that is 5% better than it's previous form but for which you charge 50% more is NOT something that will actually cure anything in the long term.

[GePap]

Originally posted by Whoha
"Malaria is an obvious case of a huge killer which is unprofitable to cure currently."

I am under the impression that DDT did some good in that area, both in profitability and performance.

DDT was a pesticide, not a drug. I gope you undertstand the fundamental difference.

[Kuciwalker]

However, IIRC it's been the most successful preventative measure taken against malaria.

[Whoha]

Yes I understand that it was a chemical developed for a different purpose.

[mrmitchell]

Good for the Brazilians, but I don't think the US will comply either way.

Who cares if Brazil joins the list of pirate nations? Already you have Russia, the Ukraine, China, Southeast Asia all full of rabid infringement...

[Sandman]

Originally posted by Oerdin
Except it is theft. Companies invested billions coming up with these drugs and if they don't make the expected returns then fewer people will be willing to invest more billions in the future to come up with more new treatments.

Intellectual property is a pretty nebulous concept. Are you saying that it should trump national sovereignty, utilitarianism or the right to live free of disease? It's worth noting that most Western countries, including America, have legislation in place that will allow them to ignore patents in the event of an emergency. Would that be theft as well?

Drug companies make huge profits, and they'll continue to make huge profits even if some poor people are spared an agonising death. Just use border controls to keep tabs on smuggled generics and it'll be fine.

Anyway, even if we assume that 'generics in some developing country = less medical research', why should the poor people of the world suffer so that 'new treatments' can be made? They won't be able to afford them either.

[Bosh]

Except it is theft.

This coming from a man with an anti-RIAA avatar

[Ramo]

Just comparing gross dollars from the pharma industry compared to government research grants and/or university funds will prove the private industry is THE big source of money when it comes to new drug research.

Not true, given that that the biotech industry spends an enormous portion of its money in advertisements. Furthermore, gov't research grants disproportionately go into fundamental research. And getting back to this case in particular, this research is disproportionately important for a place like Brazil (i.e. it's not going into correcting erectile dysfunction). Putting research into, say, vaccines primarily designed for helping the third world, is not a money maker, and won't be in the near future; to the extent that it is done by big pharma (such as the recent cervical cancer vaccine from Merck), it's primarily an exercise in PR. So, such a facile comparison is patently absurd.

Anyways, good for Brazil. In contrast to skirting absurd IP laws, our agrisubsidies actually do steal (that is, immorally take money). And from poor people barely getting by, rather than big pharma trying to fleece said poor people.

[Dinner]

To clearify I continue to support discounting of drugs to help poor people afford it and I seek for national governments to start paying for more of the costs of their laws. No free rides. Further more Lula's policies about allowing a free for all on software, music, and videos has nothing to do with access to drug treatments and he's just muddying the waters.

I do support try it before you buy it in music and I don't like the monopoly system the RIAA tries to promote. But this is a fundimentally different issue then drugs. For example, I download huge quantities of music but I also buy original copies of the CDs I like, I routinely go to concerts, and I have a closet full of band t-shirts. In other words I still compensate the artists and their greezy middlemen. I just refuse to spend $18.99 on another CD which only has one good song on it.

Stealing drugs is very different. Lula just wants to take them and never pay the original owners in anyway, shape, or form. That's why Lula will find his country on the wrong end of legal action if he goes through with it. There are numerous very enforcable sanctions for nations which don't protect property rights and Lula is going to find he's making life for his people much worse because he wants to get into a pissing match when the other guy has a high pressure fire hose.