29 December 2012

Jack Klugman Did the Wrong Thing for the Right Reasons

When actor Jack Klugman died recently, much was said about his career, but special note was given to his role in the passage of the Orphan Drug Act of 1983.

There can be no doubt here that his motives were good.  He wanted to see that diseases for which there was a limited number of sufferers, and hence limited profit, had drugs developed and produced.

Unfortunately, what seemed like a wonderful idea, subsidies and exclusivity granted to pharma, which had the added allure of providing a free market aura, has made things worse.

About ⅚ of the money spent on medical research is government money.  When one considers the subsidies present under the Orphan Drug Act, that number undoubtedly tops ⁹⁄₁₀ of the funds being from the taxpayers.

BTW, some of the Orphan drugs in questions are such "blockbusters" as, " Abilify, Provigil, Vioxx, Botox, and Cialis."

You see a similar effect with the Drug Price Competition and Patent Term Restoration Act and Colcicine, where a drug that had been in use for 3500 years (no that number is not a typo, the first documented use of the drug is from ≈1500 BCE) went from 9¢ to $4.85 a pill, a 5200+% increase.

The underlying flaw here is the idea that private business is an unalloyed good, so if there is something it will not do, the solution is to subsidize private businesses to do it, even when all indications are that having the government provide this function would provide the most benefit.

This is wrong, and we have seen nearly 40 years of this philosophy, it really became mainstream during the Carter years, has harmed society as a whole.

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