01/2002: The Galen Report

Published January 1, 2002

Those anticipating the next generation of miracle medicines should be appalled by the results of the World Trade Organization meeting in Doha last November.

Activists won a “victory” in allowing poor nations to seize patents on drugs for everything from AIDS to asthma. While the pharmaceutical industry says legal protections for their patents still exist, the overwhelming perception is that intellectual property rights have suffered a severe blow.

Over and over, the activists reminded WTO representatives that U.S. Health and Human Services Secretary Tommy Thompson threatened to violate Bayer’s patent for Cipro if the company didn’t agree to cut the price. If the U.S. can do it, why can’t we? the activists argued.

The Wall Street Journal names the drug industry as the loser in the negotiations, but the real losers are the patients whose illnesses and diseases could be cured by medicines they may never see because companies fear their investments of hundreds of millions of dollars could be stolen with little or no defense by the U.S. government.

Prescription Drug Security

Domestically, key members of the American Legislative Exchange Council (ALEC) have been working hard to turn The Galen Institute’s Prescription Drug Security Card idea into model legislation for the states.

ALEC’s Prescription Drug Working Group met in Austin last November, under the leadership of Senator Steve Newman of Virginia with staff assistance from Jennifer King of ALEC. I traveled to Austin to provide advice, and several of us worked until midnight to reshape and improve the plan.

From the seed of an idea to provide a market-based prescription drug benefit to low-income seniors, it is evolving into a detailed plan, largely as a result of excellent ideas and input from a number of experts.

Our version of the PDS plan would provide an upfront sum of $600 a year to help seniors with routine drug purchases, then would provide private catastrophic coverage for large bills. The government would pay all or part of the premium for low-income seniors, but others could participate in the plan as well. Seniors not only would get help with routine drug purchases and be protected from large drug bills, but also would most likely join a plan offering discounts and drug consultation.

— Grace Marie-Turner


Small Vote for Universal Care Is Seen as Carrying a Lot of Weight
Pam Belluck
The New York Times, 11/16/01

A study reported in the November/December issue of Health Affairs (“Americans’ Health Priorities Revisited After September 11,” Blendon et al.) found that Americans see health care as a much lower national priority than they did before the attacks of September 11.

But while Americans may now be more concerned about terrorism and national defense, an article in the November 16 edition of The New York Times about the nonbinding resolution to universalize health care in Maine illustrates this is not a time to lose focus in the fight for free-market health care reform. Pam Belluck reports the passage of the proposal in Portland “reawakened interest in universal health care, and, more important, the amount spent to defeat it shows how seriously the health care industry is taking the new movement.”

Sources: http://www.nytimes.com/2001/11/16/national/16MAIN.html

Bioterrorism and Pharmaceuticals: The Influence of Secretary Thompson’s Cipro Negotiations
John E. Calfee
American Enterprise Institute, 11/1/2001

“The stakes in the Cipro patent abridgement threat are enormous,” Calfee writes. He quotes Thompson’s congressional testimony last month under questioning by Rep. Bernie Sanders: Sanders: “But you are prepared, if Bayer does not cooperate with you, to [go to generic companies]?” Thompson: “Yes, I am.”

“This dispute is not just about Cipro and Bayer; it is about what the research industry can expect our government to do in the future. Who is going to do the research necessary to create a really good anthrax or smallpox vaccine, or create a way to bring new treatments for anthrax or the plague to market as soon as a new strain appears—if they think that when the research is done and manufacturing is underway, Congress or HHS may exercise its right to open the market up to generic manufacturers?” Calfee asks.

“Secretary Thompson and HHS should immediately issue a definitive statement saying that they did not ever actually intend to abridge Bayer’s Cipro patent, and would not do so if they again faced even remotely similar situations. They should urge other nations to make similar declarations,” Calfee concludes.

Source: http://www.aei.org/ps/pscalf011101.htm

Lack of Health Care for All Creates U.S. Security Risk
Ted Halstead and Michael Lind
USA Today, 11/12/2001

In an opinion article in USA Today, Ted Halstead and Michael Lind warn the uninsured can pose a security risk to all Americans.

Americans without insurance are less likely to seek treatment and could therefore unknowingly aid the spread of biological agents. Halstead and Lind argue “[t]he nature of America’s new war on terrorism suggests two guiding principles: Universal insurance should be citizen-based, not employer-based. And a single-payer funding method should be avoided because it would be too expensive during this period of military buildup and economic weakness.”

In a time where average job tenure is three to five years and layoffs abound, “a better approach” would be to require all Americans to purchase their own insurance and subsidize coverage for those who are “too poor or sick to pay for coverage.”

Source: http://www.usatoday.com (payment for the article is required)

Canada’s Abysmal Health Technology Record
Nadeem Esmail
Fraser Forum, 11/2001

Per-capita, Canada ranks fifth among OECD countries on health care spending, but it has “relatively few health technologies available for Canadians,” says Nadeem Esmail of The Fraser Institute. Esmail says important diagnostic equipment, including MRI machines and CT scanners, is scarce in Canada as compared to technology available to citizens of other wealthy countries, including the U.S.

Despite Canada’s high spending per person, the country ranks 19th in the number of MRIs and 18th in CT scanners, significantly behind the United States. As a result, Canadians suffer long waits to receive advanced diagnostic testing.

Source: http://www.fraserinstitute.ca/publications/forum/2001/11/section_12.html

The Galen Report is a monthly review of health policy matters provided by The Galen Institute, P.O. Box 19080, Alexandria, VA 22320, Web site http://www.galen.org. Grace Marie-Turner is president. This report is compiled by editor Elizabeth Lamirand, who can be contacted at 703/299-9550.