Los Angeles Business Journal

The following Op-Ed commentary by Jerry Flanagan, FTCR’s Healthcare policy director, was published in the Los Angeles Business Journal on Monday, August 29, 2005:

It used to be that when patients had a prescription filled they assumed that the medication had been tested by drug companies, approved by regulators and vetted by doctors. But Vioxx and its maker Merck remind us that the drug industry’s lust for profit has eviscerated all levels of security, except one: the court of law.

Last week a Texas jury declared a $253 million verdict for the widow of a man who died after taking Merck’s signature painkiller, Vioxx. Worldwide, the Vioxx death toll is estimated at 60,000. More scrutiny by future jurors will be necessary to turn Merck and its brethren into responsible corporate citizens.

The first of the Vioxx lawsuits revealed that Merck knew, yet kept secret, that use of the drug led to increased risk of heart attacks, exposing a near system-wide failure to protect the health of Americans. The FDA and other government agencies responsible for protecting us from dangerous drugs are infected by deep conflicts-of-interest between regulators and the drug companies themselves. The breadth of these conflicts suggest that regulators have become accomplices of an industry whose only motive is increased profitability.

For example, 10 of the 32 FDA scientists who approved Vioxx and other Cox-2 inhibitors (Celebrex & Bextra) had financial ties to the manufacturers of those drugs. Had scientists with conflicts of interest been excluded from the vote, Vioxx would have been removed from the market.

Drug companies have also been successful in buying-off politicians. In the run-up to the 2004 presidential elections, the drug industry contributed $1 million to president Bush, $570,000 to Senator John Kerry, and $16 million to members of Congress.

With the politicians and bureaucrats in their pockets, drug companies amassed profits 4-7 times greater than the Fortune 500 average. Vioxx generated $2.5 billion in sales for Merck last year alone.

If the government isn’t looking out for you, surely your doctor will tell you if a drug is dangerous, right? Think again. In 2000, drug companies spent $13.2 billion advertising drugs to doctors ‘ more than five times what they spent on patient advertising ‘ including $4.8 billion to send armies of salespeople into doctors’ offices to convince them to prescribe their product. These white-collar drug pushers are not required to disclose a drug’s side effects.

Only when drug companies are brought to court are they forced to clean up their act. A lawsuit brought by private attorneys prompted the U.S. Attorney General to intervene and settle a case that alleged Pfizer had fraudulently promoted its seizure medication, Neurontin, for treatments not approved by the FDA. Neurontin, erroneously promoted as a painkiller, has been linked to depression and suicide. Among other things, government prosecutors alleged that Pfizer paid doctors more that $250,000 each to promote non-FDA-approved uses of the drug to other doctors. Approximately 90% of Neurontin’s $2.7 billion in sales in 2003 were for non-approved uses.

With regulators as accomplices, doctors out of the loop, and heartless corporations in pursuit of profit at any cost, the legal system is the only tool left to protect us from corporate malfeasance. However, judicial oversight is threatened by a blistering attack from insurers and companies like Merck. In Congress, legislation is pending that would limit to $250,000 the damages for pain and suffering that victims of dangerous drugs can recover. It is a painful irony that a company that makes billions selling a drug to ease pain is pushing for limits on its victims’ pain and suffering compensation. Indeed, industry-backed limitations already in place in Texas, will likely slash last week’s Vioxx verdict by 90%.

Drug companies might try to evoke sympathy from future jurors by claiming that big verdicts will cut into research and development funds. But that would be another cover-up: an analysis of drug company SEC filings shows that they spend 2-3 times more on marketing and administration than on developing new drugs. Merck spent just 5% of its $47 billion revenue on research and development in 2001, while 15% went to profit.

Will the first Vioxx settlement be enough to scare the drug industry straight? No, but its a good start.