Last week in Washington, DC, a luncheon at the National Press Club Ballroom was the scene of a unique treat, as members of the US media were on hand to sample the steak salad and crab cake sandwiches and to rake Ian Read, CEO of Pfizer Pharmaceuticals, over the coals.
One of the “stewards of the drug industry,” Read was on hand to defend his company’s practices (price gouging, political lobbying, etc.) and to spread the gospel of good will from Big Pharma. And to take some pot shots at Canada along the way.
For over an hour, Read spoke of the challenges faced by pharmaceutical companies in bringing a new drug to market, insisting that research and development are costly endeavours and that without charging the high fees they do for drugs (he’d call it citizen-funded investment in medical innovation, you may have different names for it), advances in healthcare just wouldn’t happen.
The messaging continued through until near the end of the Q & A when the topic of international trade agreements came up. “We didn’t support [the Trump-scuppered] Trans Pacific Partnership because it was really bad for our intellectual property,” said Read. “Most of these countries, if you look at Canada, if you look at Australia, if you look at New Zealand, all highly developed countries, all free-riding on inventions in the United States” (read “Ian Read, CEO of Pfizer, aka the “Donald Trump of Pharma,” Bashes Global “Freeloading” Off U.S.”; http://sco.lt/7TRiDZ )
Read drove the point home by saying, “Canada is cheaper because of [drug] ration[ing]. And Canada is cheaper because it can, because it free-rides off American innovation.”
The claim has been made before. The idea goes that citizens in countries with universal healthcare pay less for drugs than they do in the US because the governments of Canada, New Zealand and Australia constrain drug companies from charging the full monty for their products. Thus, the poor pharma companies have to make do with less profits in the rest of the world and consequently must rifle all the more vigorously through the pockets of American citizens in order to pay for their R&D.
Freeloaders, Mr. Read? Freeloaders on American innovation! I’m no Einstein, but I think you might have it a little ass backwards, dude. Do you like that smart phone in your pocket, Mr. American businessman? I’d say you owe us and the folks at BlackBerry for that one. The old-fashioned telephone, too, you might remember, was made by a Canadian/Scotsman.
Thomas Edison may get the credit for the light bulb, Mr. Read, but he bought the patent from a couple of Canadians by the name of Woodward and Evans. More co-opting of Canadian ingenuity, the inventor of the AM radio broadcast was Reginald Fessenden, another Canadian trying to make a living down in the States.
Who invented the Java programming language? James Gosling from Calgary. Who invented both the alkaline and lithium batteries? Chemical engineer Lewis Urry from little Pontypool, Ontario. IMAX technology? A Canadian team.
Yes, Mr. Read, some of our inventions may seem a bit pedestrian to you big city types. The paint roller, for one, and instant mashed potatoes. Five pin bowling. But no one can say we aren’t crafty with our surroundings, to wit, the snowblower, the ski-doo, instant replay and the hockey mask.
Finally, allow me to step into your sandbox, Mr. Pfizer, and say one word: insulin.
Now, with that fully out of our systems, let us return to the broader thesis that research and development carried out by pharmaceutical companies requires proper financial investment by countries and their drug-consuming, over-a-barrel citizens.
“Overall, I think it’s fair to say that we’re being responsible when it comes to the pricing of our medicines,” said Read. “We’re producing great value for society and simultaneously taking large financial risks due to the uncertainty of the drug.”
In any given year, companies like Pfizer spend more on sales and marketing of their drugs than on research and development. From 2013, for example, Pfizer spent $6.6 billion on R&D and $11.4 billion on sales and marketing. The same year, Johnson & Johnson spent $8.2 billion on R&D and $17.5 billion on marketing.
That $6.6 billion spent on R&D seems a lot less impressive when stacked up against $22 billion in profit — and, consequently, the whole argument that high drug costs are necessary for innovation seems a whole lot of nonsense…
And yet there he was, blaming Canada and calling it “commercial blackmail” when governments (“monopoly-purchasing governments,” he says) have the audacity to set prices for his drugs. There he was chastising Canada and attacking our government’s utter gall in considering its citizens’ interests, their health and their livelihoods when deciding on drug prices. And calling us a country of innovation freeloaders, to boot!
Before pondering that some more, I think I’ll zip up the ol’ parka, jump on my snowmobile and head to the bar for a Bloody Caesar. Maybe get a butter tart, too.