Drug Giant Pledges Cheap Medicine For World's Poor

bmsleight writes in with a Guardian piece on the decision of the world's second biggest pharmaceutical company, GlaxoSmithKline, to radically shift its attitude towards providing cheap drugs to millions of people in the developing world. "[The new CEO] said that GSK will... cut its prices for all drugs in the 50 least developed countries to no more than 25% of the levels in the UK and US — and less if possible — and make drugs more affordable in middle-income countries such as Brazil and India; put any chemicals or processes over which it has intellectual property rights that are relevant to finding drugs for neglected diseases into a 'patent pool,' so they can be explored by other researchers; and reinvest 20% of any profits it makes in the least developed countries in hospitals, clinics, and staff."

Comments

Dude. What about the World's rich?

[BadAnalogyGuy]

Consider that just because a nation's average income is relatively high, it does not follow that everyone in that country is able to buy the products at the higher price. Why should people who had the dumb luck to be born in some shithole country be blessed with lower-priced medicine?

That's not social justice. It's social prejudice.

Re:Dude. What about the World's rich?

[jonaskoelker]

Why should people who had the dumb luck to be born in some shithole country be blessed with lower-priced medicine?

Because in Soviet Russia^W^W^H Capitalist America, you can increase profits that way. And that's encouraged. In a market where you're free to not trade, any trade you do is good for the people who trade (according to simplistic Econ 101 principles, and discounting negative externalities, and ...).

Whether selling cheap medicine in poor countries is a good thing in practice is another question.

That's an attempt at an answer to your question. I want to add to that the following:

I find it strange that you say people are lucky to live in (er, be born in) a shithole; the two don't add up. Even if you isolate their luck to the case of medicine prices, what they have to pay might upset their budget more (or less, could as well be) than you paying what you have to pay where you live.

Spending $AMOUNT $CURRENCY on medicine means you forgo the option of spending $AMOUNT $CURRENCY on something else. How bad that is for you depend on what else you could have gotten and how much you want it. That varies between cultures depending on their shitholiness.

Re:Dude. What about the World's rich?

[spun]

You are forgetting the control aspect. If we socialize medicine, people won't be nearly as afraid of losing their jobs, and might not put up with as much crap. Deep in their hearts, every rich person knows this. Socialized medicine would erode their control. It's not even about money, per se. It's about being able to lord it over others, and them not being able to do anything about it. It's not a planned conspiracy, it's a dark little secret every rich person acts on without even acknowledging that is what they are doing.

Re:Dude. What about the World's rich?

[cirby]

1. Richer countries like the US and UK are subsidizing this drug program. You don't honestly think GSK is going to give up its profits now do you...

They've been doing this sort of thing for decades, and YES, they've been giving up profits.

2. They are putting some of their patents in a "patent pool", whatever that means, instead of doing the real "right thing" and releasing those patents to the public domain. Torpedo patents anyone...

It keeps fly-by-night Third World companies from producing crappy, ineffective versions of the real products. It also reduces (by a large amount) the chance that they'll be sued by some idiot because one of those nobody companies comes out with a harmful version of the drug that ends up killing or injuring a lot of people (yes, that happens, and when it does, there will be people just like you complaining because those Big Pharma folks should have done something).

3. This isn't an attempt to "do good" more than it is an attempt to stop countries from ignoring their patents and developing generics on their own. A little profit is better than no profit in their eyes. Besides, as 1 above suggests, they will make it up off the richer countries.

This whole paragraph is just plain old uninformed bashing of a whole industry, with no proof. I've worked with pretty much all of the big pharmaceutical companies, and they've been doing good of this sort for a long time, selling good medicines to people all over the world - and paying for it with profits made from the rich countries. The money has to come from somewhere. IF they give all of their profits away, NOBODY CAN AFFORD TO DO THE RESEARCH.

This is a multi-billion dollar a year industry we are talking about here. ...creating drugs which literally cost billions of dollars to create. For every drug that makes it to market, there are THOUSANDS of compounds that have to be investigated. Out of those thousands, there are hundreds that take more research to find out if they have obvious harmful side effects. Of those hundreds, there are dozens that may work. When you get down to five or six candidates, you have to spend millions upon millions of dollars to see if they're effective and safe. Then you have to figure out if you can make enough of the stuff, in pure enough form, to be cost-effective. Then (because the patent term has mostly run out while you were doing all of this) you have to sell the new drugs for a lot of money, for a very few years, and hope that it pays for itself before some OTHER company comes out with something similar for half the price, and before the patent runs out.

They have no conscience and no morals. Profit is their only motivator. No company does anything out of the goodness of their heart unless it will lead to greater profits and/or market dominance. This is doubly so with the drug industry.

You really don't know anything about these guys, except what you see in bad Hollywood productions.

I've had the privilege to sit in rooms with hundreds of pharmaceutical employees, from the lowest salesmen to the head of the company, watching dozens of people crying their eyes out because they came out with a new, better treatment for AIDS that would save lives. No, they weren't crying because they were going to make money (the product wasn't going to be that profitable), they were celebrating because they DO GOOD THINGS.

I've listened to CEOs talk, off-the-record, with their top people, happily bragging about a new program to get free drugs to poor people (no, not that "first taste" BS, but long-term free treatment for many hundreds or thousands of people, with no set end date - it's been going on for a long time, too. The under-the-table "free samples for life" thing has been around for years, they just made it official and expanded it).

If you want to see someone with no conscience and no morals, look in a mirror. It takes that sort of person to trash people when you don't know anything about them or about what they actually do for a living - or why they do it.

Re:Dude. What about the World's rich?

[sac13]

If we turned it into a government mess, we would stand a better chance of controlling the costs and cutting down the bureaucracy than we do now. I agree that the insane overhead is the real problem. But the free market has proven itself incapable of removing insane overhead. Every niche, no matter how useless to society as a whole, is exploited and defended. Sure, government protects its entrenched interests too. But this won't be an entrenched interest. So in the process of publicizing health care, we can destroy the current bureaucracy, and with a tiny bit of clever legislation, as well as ongoing citizen oversight, we can keep it from becoming an entrenched government bureaucracy.

Can you name a single government program that has controlled costs and cut down on bureaucracy? It doesn't happen. And health care is certainly not an area where it will happen... at least the way the people want it. The cost reductions come only from rationing, not bureaucratic cuts. To control the costs, you'll have to wade through a bureaucratic mess just to get basic care.

Sure, they could mandate the price of things, but that just means fewer people will go into medicine. We're already experiencing shortages of nurses and some types of doctors because talented people would rather do something else that doesn't require the level of b.s. that has to be dealt with in medicine. So, then you get even more rationing and lower quality of care.

You can't exactly blame the free market for the health care mess... at least the medical side of it. Sure, "insurance" has done more than it's part to screw things up, but that was because it changed the market from a free one to a regulated one. It's just regulated by insurance rather than government. Of course, it's also not free because the government already pays nearly half of all health care costs in the US. We already have a government system. And, it hasn't improved things.

The only way to make things affordable is to destroy the bureaucracy. Government only creates bureaucracy. It never even reduces it.

I can be open to a government provided OPTION for catastrophic care insurance for those that can't afford it. I can even be open to government subsidized primary care for those needing assistance. But, if we continue to allow primary care to be managed by bureaucracy, whether private or government, rather than by patients and doctors themselves, then the costs will grow, the bureaucracy will grow and the mess will only get bigger.

Hold the plaudits, self-interest is driving this

[Bearhouse]

FTA: "Campaigners privately say the move is remarkable, although they worry that it may undermine the generics industry which currently supplies the cheapest drugs in poor countries."

Exactly. Big pharma is in big trouble - blockbuster drugs going off patent, no new ones coming online, Govs. getting more aggressive in fixing prices. So, this is a smart move. While they still can, they can use the one advantage they still have - their size - to buy/crush the small 'generics' producers out.

Still, whatever the underlying motivation, it's encouraging to see big pharma at last getting more involved with the poorer nations of the world, which have been scandalously ignored.

The Plan

[BTWR]

Step 1. Go to so-called "poor country."
Step 2. Buy 10,000 units of drug X at 25% of its cost in the US/Canada/Europe.
Step 3. Sell drug X in US/Canada/Europe at 50% of its normal Drug X cost (i.e. at twice the price you paid), advertising your pharmacy as having the best prices in the country.
Step 4. (Just do step 3 a lot)
Step 5. Profit!

So...

[CountBrass]

Not only do we taxpayers get to carry on subsidising the world's poor and keeping their leaders in designer shoes, now as customers of the drugs companies, we get to subsidise their medicines as well.

I give to charities, domestic and foreign, because I've decided they are deserving of my money. It is not the job of Government to do so on my behalf.

Re:the first tablet

[OeLeWaPpErKe]

Of course, such an arrangement is only possible if people respect the "licence" (contract that is a prerequisite of the sale) of the pills.

That contract is going to specify that export to richer countries is not permitted.

Suppose this after-sale contract were to be ruled void (which is quite possibly the correct way for a judge to rule given current law), and import allowed, the pharma "giant" will be competing against itself, resulting in massive losses.

Those massive losses, that stem from not respecting the "licence" of the pills, will either prevent the pharma company from offering those pills, or they will kill the company.

Great initiative ! I truly hope it will last, but I fear for it's viability.