Health Affairs, 24, no. 1 (2005): 291-293 doi: 10.1377/hlthaff.24.1.291 © 2005 by Project HOPE	New Online   How Would Obama, McCain Cover The Uninsured?   Debating Cost Of Uninsured   Try Medicare-For-All   HA Blog Top 10

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Book Reviews

Turning Point For The Health Care Blame Cycle?

This is the proverbial book that should not be judged by its cover. The subtle sneer of its title and bold muck-raking promise of its subtitle sound like intellectual ammunition for the loud, if poorly armed, legions of professional and amateur critics of the pharmaceutical industry. But in its belabored attempt to untangle the miasma of science, medicine, politics, money, and luck that is the shared academic, government, and industrial enterprise of drug discovery and development, The $800 Million Pill fails to deliver on its packaging. Merrill Goozner’s interesting if not compelling exploration of pharmaceutical research and development (R&D) is not an academically disciplined, empirically based tirade against one of the oft-repeated sins of the drug industry; rather, it is an inadvertent explanation of spending levels that seem, to the uninformed, to be outright sinful.

Instead of drilling down into the hard numbers of total dollars spent and total drugs invented collectively in the United States during the past few decades, the author, the former chief economics correspondent for the Chicago Tribune, heads down the well-traveled journalist’s road of characterizing an entire industry by reporting a handful of anecdotes. This might work for a relatively homogeneous industry such as oil drilling, mutual funds, or insurance. But for a massive and sprawling industry such as pharmaceuticals and its younger sibling, biotechnology—both of which spend billions of dollars on the crap-shoot of drug development—the condemnation-by-anecdote approach is inappropriate, misleading, and ultimately useless in the formulation of health policy. As the book itself makes plain, that tiny number of potential drug candidates that actually end up working as new medicines are the exceptions, not the rules. They represent happy accidents of science, and, to the great consternation of the drug industry, none of them follows any pattern. Not surprisingly, then, a journalistic approach to what is an intractable system problem leaves us with paltry ideas for fixing it.

In The $800 Million Pill, Goozner embarks on a yeomanlike effort to introduce us to the entangled nexus of science, business, and politics underlying the billions we spend, through both public and private funding, on drug discovery and development—a nexus characterized by thousands of human stories. Most of these stories are as unique as the dense medical mysteries at the heart of each, and all are subject to the ironclad law of serendipity that has come, to the bitter chagrin of drug companies and Wall Street, to characterize drug discovery and development. Illustrating the pervasiveness of that law, if unintentionally, is one of the book’s more notable contributions. In anecdotes ranging from the discovery of erythropoietin (EPO), biotech’s first blockbuster product, to the political theater surrounding the discovery of the three-drug "cocktails" that would finally prove effective against HIV, Goozner maps out the convoluted public/private path that some of our more important drugs have taken on their way to market.

Notwithstanding the invective against the drug industry compelled by the book’s packaging, Goozner’s own integrity gets the best of him. His prose is earnest, almost to a fault, as if he had internalized the personalities of the scientists he portrays in his stories. As a result, the book has the belabored quality of the science writing found in the New Yorker, with little of the grace and none of the wit. In its place we get gratuitous potshots at the drug industry, knee-jerk displeasure with the Food and Drug Administration (FDA) (on one page for moving too quickly to review drugs at the industry’s behest and on another for not moving quickly enough), and a general grumpiness about the messy imperatives and imperfections of capitalism. But in the spirit of good science writing, the book provides thorough, accessible, and remarkably effective compressions of an array of topics relevant to drug discovery and development: the "eureka" moments in the emergence of the biotech industry; the battles over access to clinical trials won by AIDS and cancer patients; two decades of bipartisan struggle embodied in several major pieces of legislation that have given rise to de facto industrial policy regarding the conversion of government research into commercial products; the fools’ gold rush that was the codification of the human genome project; and the prolonged, bitterly frustrating "war on cancer" that we will be fighting for the rest of our lives.

What is missing most from the book, aside from a disciplined analysis of its own economic premise, is passion. Goozner’s attempt to draw human portraits of a handful of the tens of thousands of anonymous scientists working in government, academic, and industry labs falls flat; by default, they all end up as either white hats (government and academic scientists and a few brave researchers in industry who fight their own companies’ skepticism or bureaucracy) or black hats (everyone else in industry, especially those with entrepreneurial ambitions). Given that the bulk of the book is dedicated to animating our wars against various diseases, this failure may be its single greatest shortcoming. Despite the millions of lives and billions of dollars at stake, Goozner voices almost none of the humanitarian outrage of other books that proselytize against hypocrisy institutionalized throughout our health care system, notably Randy Shilts’ The Band Played On, Walt Bogdanovich’s The Great White Lie, and George Anders’ Health Against Wealth. By contrast, it appears that Goozner hopes that the facts speak for themselves, and they do not.

Perhaps this is because Goozner is a journalist seeking to enumerate (rather than to actually animate) a populist economic argument that simply does not hold up to scrutiny. As a result, he is caught between the inflammatory premise of his book’s subject and the complex and subtle reality of that subject’s actual facts. He wants to prove one of the more popular pieces of folklore about the drug industry: that government and academe do the real work, and the drug companies merely market taxpayer-funded research. But the real numbers, all of which are echoed in the book but are never juxtaposed for obvious reasons, tell a vastly different story. In 2002 the National Institutes of Health’s (NIH’s) annual budget was $24 billion.¹ That same year the drug industry’s annual R&D budget was $32 billion.² Goozner himself regrets that the biotech industry spent $16 billion on R&D in 2001 (p. 242). As Goozner also rightly points out, a portion of the drug industry’s R&D budget includes the cost of developing and testing drugs that represent minor modifications of existing drugs. What is the amount, and how much would society save if policymakers found some way to make this perfectly understandable corporate behavior illegal? According to Goozner, we would save $1.5 billion. This is not a trivial amount of money. More importantly, that $1.5 billion in wasteful R&D spending does generate significant spending on the resulting "me-too" drugs—spending that is finally migrating to consumers, where it belongs. This $1.5 billion is also a small figure compared with the more than $70 billion we spend today, through both public and private funding, on drug discovery and development, and it would hardly create a windfall of cash to solve the broader health system problems that everyone seems to want to lay at the doorstep of the drug industry.

Which returns us to the broader problem with The $800 Million Pill. As is typical of almost all recent books that examine the politics and economics of the drug industry (David Cutler’s Your Money or Your Life being a major exception), The $800 Million Pill has at its real heart not a disdain for the specific business practices it examines, but a visceral hatred of the businesses in general that practice them. Throughout the book Goozner includes all of the usual swipes at the drug industry for acting like a for-profit industry: for having the gall to advertise its products; for ignoring small markets with government protection; for pricing its products based on what the "market" will bear; and for using existing federal law to protect its intellectual property. Like so many books critical of various health care business segments, this is a complaint not against the industry but against all industry—against capitalism and its unseemly tendency to reward risk taking, investment, innovation, and luck with profits. (This bias creeps out in Goozner’s annoying use of the word "peddle" for "market" or "sell" more times than one can count.)

The $800 Million Pill may turn out to be especially useful for placing us in the ongoing health care blame cycle, proving to be very much a product of the 2000–2005 period. Along with new books by Jerome Kassirer and Marcia Angell, also reviewed in this issue of Health Affairs, Goozner’s attempted assault on the drug industry’s R&D practices should constitute the inevitable turning point in the current five-year rotation of blame that defines the popular dialogue over what is wrong with the U.S. health care system—the same way a handful of anti–managed care books in the late 1990s represented the high-water mark of blaming everything wrong with health care on the health insurance industry. The next five-year period will no doubt return us to 1990–1995 part of the cycle, with everything wrong with health care attributable to the economically self-serving behavior of hospitals and doctors.

For the seeming majority of health system observers who, after the fashion of the day, wish to blame all of the health system’s problems on the drug industry, The $800 Million Pill appears to be wonderful cannon fodder. The book, however, is anything but, and in fact it should provide unlikely cover fire for an industry seeking to explain its Herculean labors and mind-boggling expenditures to an angry public. Indeed, readers with minds open enough and eyes sharp enough to read past the book’s packaging and Goozner’s obligatory sniping at the drug industry will notice the one overarching truth about the discovery and development of drugs: The practice is as fickle, complex, capricious, and enigmatic as disease itself.

J.D. Kleinke

Editor's Notes

J.D. Kleinke (jdk{at}jdkonline.com) is executive director of Omnimedix Institute, a nonprofit health care research organization funded by foundations, corporations, and private individuals. He also provides health care business strategy consulting and education services, through Health Strategies Network Inc., to health information technology companies, health plans, hospitals, pharmaceutical companies, investment banks, and health care foundations and is on the board of directors of HealthGrades Inc., a publicly traded health information company based in Lakewood, Colorado.

NOTES

1. See National Institutes of Health, "Press Release for the FY 2003 President’s Budget," 4 February 2002, NIH Budget at a Glance (FY 2002 figures), www.nih.gov/news/budgetfy2003/2003NIHpresbudget.htm (30 November 2004).
2. J.D. Kleinke, "Access versus Excess: Value-based Cost Sharing for Prescription Drugs," Health Affairs 23, no. 1 (2004): 34–47.[Abstract/Free Full Text]

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