The Future of Pharma Profits

When I was talking about pharma's role in innovation, a lot of people confused this with being pro-pharma. The implication was that I should be in favor of anything that's good for Big CDrugs.  This is sort of like thinking that because I like watching Derek Jeter play baseball, I would also enjoy watching him stab a puppy to death.

Hence I am not happy, but outraged, by this:

Time for a brief comment on health care reform, now that Sen. Baucus has presented a bill to the Finance Committee (which, to be sure, I believe has already attracted over 500 proposed amendments). As is well known, the largest drug industry trade group, PhRMA, signed on to the whole idea of a large reform effort early, in exchange for a seat at the table (and a chance to make things go favorably). How's that working out so far?

As Steve Usdin at Biocentury writes, the answer is "fairly blatantly":

The parochial value of PhRMA's controversial decision to cut a deal with the Senate Finance Committee and the White House became clear last week as details of the committee's healthcare reform bill emerged that favor big pharma companies over their biotech siblings. The bill also pounds the medical device industry and slams laboratory service providers, sectors that didn't agree on "voluntary" contributions to healthcare expansion. . .

. . .A 233-page summary of the America's Healthy Future Act released by Finance Committee Chairman Max Baucus (D-Mont.) includes most of PhRMA's healthcare reform wish list and has only one major provision pharma companies hope to kill: a commission with powers to constrain Medicare spending.

The tax put on medical devices by this bill has already been noted widely in the press, and I see that Sen. Kerry is already objecting to that provision - naturally enough, since Massachusetts has some big players in that area. The Senators from Guidant and Medtronics (also known as Indiana and Minnesota) are speaking up as well. The trade association for that industry (AdvaMed) apparently couldn't come to terms with Washington, so this tax is their reward - which, in a nutshell, is the sort of thing that keeps gradually turning me into a libertarian.

Profits are good when they result from providing a service people want.  When they are the result of capturing the government by cutting special deals, they're immoral and inefficient.  And this is just the beginning . . .