Making money, a pile of it, out of human suffering is one of the most lucrative businesses on the planet. The pharmaceutical industry is worth nearly $500 billion a year. In Fortune 500, a list of the richest firms compiled by Fortune magazine, the drug companies outdo the others by generating double the profits. But these vast sums of money hide many secrets, many of which the industry try their best to conceal from the public.

Joel Bakan, a filmmaker and author, recently wrote in the Guardian: “If a corporation were a person, it would be a psychopath – cheating, lying and even killing to serve the interests of its shareholders.” But pharma companies are not murderers as such. Rather, they allow people to die by not investing money where research is most needed or by charging astronomical prices. Indeed, Brazil, India and South Africa have been locked in interminable legal battles with one company or another over the issue of generic drugs.

At the moment, a pharmaceutical company is given a 20-year patent, over a particular product, under the patent laws of the World Trade Organisation. However, depending on their technological knowhow, individual countries can choose whether they take out a patent on the drugs. India, for example, has taken a process-only patent. It can make the drug locally as long as it does not copy the method of production. Thus, India can deliver the cheaper generic drugs to its population instead of relying on the expensive brand name variety. But the companies have tried to sue, claiming that it is breaking patent laws. Both India and Brazil have had to fight costly lawsuits over generic drugs.

These behemoths of the health industry insist that generic drugs prevent Research and Development on (R&D). The same explanation is given for the high price of patented drugs. But where is the truth? It is simple once we break down the expenditure of drug firms. They claim to spend 17% of their drug sales in R&D, but this is two and a half to three times less than what they spend on advertising. This is according to a research paper, Will lower drug prices jeopardize drug research? published this year in The American Journal of Bioethics.

The paper also explains some troubling facts about the industry. Only 18% of the R&D budget is actually used to find new drugs. The other 82% is used to find variations of existing substances for ailments already being treated by other drugs. In the jargon of pharmaceuticals, this is known as ‘me – too’. That is, if a company finds a drug to treat certain disease, another will rush in to find a derivative to capture a share of the market. But the cynical world of this monolithic business does not stop short at heretic practices.

The Blockbuster Syndrome is the real modulator of all commercial activity. A blockbuster drug is one that will yield more than $1 billion a year in sales. Thus, pharma companies devote themselves to finding this Holy Grail. Funds are diverted towards research projects for the disorders of rich societies and for money-making products rather than the most pressing life-saving ones. Subsequently, the drug firms can cash in for a number of years. Figures by Intercontinental Marketing Services (IMS) Health, a company that does market research and business analysis, shows that the top ten selling drugs brought in $48.3 billion in 2003.

The International Policy Network (IPN), a right-wing think tank, stresses that countries like Mauritius drive up the price of drugs on a local level. A report in 2003, also published by the World Health Organisation (WHO), shows that taxes and duties, plus wholesale and retail profit, hike up the Mauritian pharmacy bills by 55%. In Brazil and South Africa, this can reach 82% and 74% respectively. But the high cost is at the manufacturers’ end of the scale and the corporations cannot be absolved of blame. Without tariffs on medicine, governments would find their finances significantly depleted. Also, why should governments reduce their intake when a private company, more concerned about lining the pockets of shareholders, can take in billions on just one product?

Neglected diseases

Drug franchises hide another ugly side. According to Médecins sans Frontières (MSF), “out of the 1,393 new drugs approved between 1975 and 1999, just over 1% were specifically developed for tropical diseases and tuberculosis.” This organisation estimates that only 5% of R&D is being spent on the health problems of 93% of the world’s population. The MSF report shows a bias towards rich countries’ health problems. If we consider the top ten best selling therapies, as compiled by the ISM, we notice that antidepressants, anitpsychotics, anti-epileptics, and cholesterol reducers figure prominently. These are hardly the health issues of poor Africans and Asians. As Mauritius slowly copies affluent countries and inherits their health problems, we can expect our medicine costs to increase significantly in the future.

Critics further castigate the drug industry. The WHO argues that pharmaceutical companies donations can sometimes be dubious. 10-40% of all drug donations, between 1994 and 1999, are useless, as they do not figure on the national essential drug list, nor on the organisation’s own model of necessary medications. Shockingly, 30% of the ‘gifts’ had a shelf-life of a year or less. At other times, the companies continue to market substances that have shown harmful side effects, as was the case in India.

The problems of Mauritian chemists seem all the more credible in the face of monopolistic tendencies on the global stage. But until countries are prepared to fight patent laws that drive up the cost of drugs, small businesses will have to bear the burden of corporate greed.

<B>Diren

VALAYDEN

Outlook Correspondent in Dublin</B>