Big Pharma Can Save UsWhen Athens and Sparta, the superpowers of ancient Greece, clashed in 430 B.C., the outcome may have been decided by a third combatant. This one, measured in microns (a unit of measurement a thousandth of a millimeter), carried a plague that decimated Athens and killed its brilliant leader, Pericles. Over 2,000 years later, the Spanish flu claimed more victims than the Great War. For untold millennia, this was the rule, not the exception: Diseases that flowed in the wake of armed conflict would often claim more lives than combat.
Fight swine flu with modern drug companies and capital markets
May 1, 2009
Industrialization—and the globalization of mass markets—means that an enterprising microbe doesn't have to wait for Spanish conquistadores to decimate virgin populations.
Planes, trains and automobiles—byproducts of the Industrial Revolution—are much better, and faster, ways to circulate in the global bloodstream. Turistas in Cancun enjoy their margaritas, but Mayor Bloomberg gets the hangover when they return home with the swine flu.
No amount of infrared scanning at airports can stop the bugs that reside in your bloodstream while the virus is pre-symptomatic. The only sure way to nip the bug before it blooms is to blockade global trade and travel. Unless you're in favor of another Great Depression, that's a cure that is truly worse than the disease.
Luddite fantasies aside, our real hope rests with another by-product of the industrial revolution: the modern corporation and capital markets.
Novartis, Sanofi-Aventis and GlaxoSmithKline (and their investors) have a vested interest in helping us decode and treat new plagues. As long as we keep the industry that makes the cures hale and hearty—abjuring price controls, ruinous lawsuits and unnecessary red tape, the policy equivalent of leeches on innovation—pandemics may emerge, but they need not ravage whole nations.
Pharmaceutical companies—those much reviled things—now have the tools to map the genomes of new viruses and bacteria in hours and days, pinpointing the genes responsible for illness and death and priming antibiotics and vaccines to target the enemy.
We don't know if swine flu will become a pandemic, but companies are already developing cell-based technologies to grow the viruses that are integral components of vaccines, replacing old and unreliable chicken-egg incubators and allowing manufacturers to ramp up production quickly to meet unexpected need.
Companies have also created new generations of vaccines with materials called adjuvants, which both help stimulate the immune system and require less viral material to be injected into the body to guarantee an effective immune response. This loaves-and-fishes approach means that less is more: The same amount of viral material can be spread out into many more effective doses, reducing the need to ration vaccines in the event of a true pandemic.
Adding to the modern armamentarium are a growing number of anti-viral drugs like Tamiflu and Relenza that inhibit viral replication, acting both as prophylactics that can reduce the risk of infection and treatments that reduce disease severity—buying time for vaccines to reach the market and quarantine further outbreaks.
Two decades ago, vaccines looked like a low-end commodity business better suited for Wal-Mart than big pharmaceutical firms. Today, though, the market for new vaccines has stabilized and even improved thanks to two developments.
First, in 1986 Congress created the Vaccine Injury Compensation Program, which gives vaccine manufacturers substantial protection from personal injury lawyers who are every bit as predatory as the bacteria Yersinia pestis. Also, in 2002, Wyeth's Prevnar became the first blockbuster vaccine with over $1 billion in sales, signaling that hi-tech vaccines could fetch a premium price from insurers.
Where public buyers dominate the markets (as they do for seasonal influenza vaccines) wise policies have helped too. In 2005, Congress authorized over $7 billion for pandemic preparedness, including funding for private firms to develop cell-based vaccine production technologies in the U.S. More generally, the move reassured companies that policymakers are serious about underwriting the cost of pandemic vaccine research.
Other vaccine innovations are just over the horizon: multi-purpose vaccines that can thwart not just this season's flu but several different variants; improved adjuvants that help make vaccines even safer and more effective; and vaccines that can help the body thwart its own worst enemy, cancer.
Swine flu is the story today as governments race to stockpile drugs and companies stand poised to produce a swine-flu vaccine—if the World Health Organization asks them to shift production from seasonal flu vaccines to swine flu.
But the real story, as always, isn't this black swan but the next one we don't (and can't) predict. To ensure we're ready for the next pandemic, companies must trust Uncle Sam to honor his promises at market prices and protect them from the inevitable flood of lawsuits after the demon virus or bacteria has been tamed.
It's ironic that the specter of a swine-flu pandemic coincides with the health-care reform debate in the U.S. President Obama and his party want to win the war against swine flu, cancer and Alzheimer's—but they also want price controls on the products devised by drug-company scientists.
When it comes to R&D, the president and his party seem to love the "R" but hate the prices that make the "D" possible. The Democrats are also financially beholden to the plaintiff's bar and are eager to unwind protections against rogue lawsuits, another disincentive for companies to invest in the expensive and highly uncertain pursuit of new cures.
If big pharma doesn't get its profits, all the basic science in the world won't help us fight the next pandemic. And since the U.S. accounts for about 50% of global profits for the industry, when it comes to incentivizing innovation, we are the world.
For now, the swine flu will make its random way through our political and social networks, and drug companies—the equivalent of a national immune system—will race to bombard it with drugs and vaccines.
But this is the original long war, and staying ahead of our very small but rapidly evolving enemies demands that industry remain profitable, flexible and innovative. If not, we may find ourselves the next democracy devastated by an invisible foe.
Paul Howard is a senior fellow and director of the Center for Medical Progress at the Manhattan Institute for Policy Research.