An Extreme Of Capitalism?

Anyone who reads my blog regularly and has drawn the conclusion that I am anti-capitalism would be completely wrong. I have nothing against business, entrepreneurship, nor corporations, per se. And I do believe that those who take risks should be appropriately rewarded.

What I am against, however, is extreme imbalance. I have nothing but withering contempt for the winner-take-all attitude that sees life as a zero-sum game. Such thinking betrays an unschooled mind and a woefully underdeveloped character, in my view. And that is exactly the mentality pervasive in so many realms today, be they political, economic, social, business, etc. Capitalism, yes. unfettered capitalism, no.

During the weekend I read a story in The Star about the development of drugs to treat what are known as orphan diseases, those maladies that afflict a relatively low number of people. Traditionally avoided due to high development costs and low market potential, pharmaceutical firms are now turning increasingly to them as a potential source of new profits.

Patents expire on drugs that have become standard treatments for afflictions such as heart disease, diabetes, etc., and drugs to replace tried and true therapies are not needed. The revenues arising from treating those standard diseases, while still substantial, have limited growth potential, something that is anathema in a fiscal culture that demands continual corporate profit growth.

The beauty of orphan diseases, from a profit perspective, is that the majority of them are genetically-caused, which means that those for whom the drugs are developed will be life-long customers. It is this fact that makes the development of such drug treatments not only a literal life saver for some, but also an everlasting curse for the governments that will be called upon to fund them.

“There is a big crunch coming in terms of the new (orphan) products being developed and in terms of cost,” says Dr. Michael Rieder, who holds a research chair in pediatric pharmacology at Western University’s Schulich School of Medicine and Dentistry.

“We’ve only seen the tip of the iceberg and it’s not going to go away.”

The issue came to the forefront again last week when young Madi Vanstone and her mother, Beth, visited Ontario Premier Kathleen Wynne to seek assistance in getting Madi's drug, Kalydeco, listed so that her costly treatments would be covered under the province's drug plan. It was approved by Health Canada in late 2012, but costs $300,000 a year per person and works only for a certain genetic variant of cystic fibrosis. It’s estimated about 20 people in Ontario need it but do not have private coverage.

Fifteen countries cover the medication, but so far Ontario’s drug-purchasing consortium has failed to negotiate what it sees as a “fair” price with manufacturer Vertex Pharmaceuticals.

Consequently, Madi's family currently must rely on fund-raising for the treatment which has left her symptom-free.

The problem, as you can see, lies in the extreme pricing that big pharma attaches to what can be sometime regarded as miracle drugs. These exorbitant rates are justified by what they claim are the high development costs of the therapies, coupled with their limited market.

Jared Rhines, vice-president of scientific and strategic affairs for the group Rx&D, which represents Canada’s research-based pharmaceutical companies, says,

“The development process from discovery to development to clinical research is the same, whether it’s a drug that treats a high number of patients or a drug that treats a rare population,” Rhines says. “And when you get to orphan drugs, it’s all those same requirements and development costs and profits spread over hundreds of patients versus what is a traditional drug that treats tens of thousands of patients.”

By the way, the industry claims, but refuses to offer any supporting documentation for 'competitive reasons,' that the average cost of drug is $1.3 billion.

This is a figure hotly contested by some:

Some experts, however, say drug companies grossly inflate their R&D costs, with the oft-cited $1.3 billion-per-drug figure out of whack with reality.

Trudo Lemmens, chair of health law and policy at the University of Toronto law school, says industry uses these claims to justify “unconscionable prices.”

He says that a credible New Jersey study claims that average drug development costs could actually be in the $45 million to $55 million range.

“The claim of $1.3 billion or higher costs of drug development is industry mantra,” he says. “But it’s based on things that the industry keeps close to its (chest) and it’s very hard to critically analyze.”

As well, such claims are misleading, if not downright untruthful, for other reasons:

Jillian Kohler, director of global health at the U of T’s Leslie Dan Faculty of Pharmacy, has this to say about the issue:

... these numbers, for people who are actually in the field, are highly controversial and industry doesn’t like to be honest about what goes into their R&D.”

Kohler says drug companies may routinely pack marketing costs into their estimates as well as lost investment returns — opportunity costs — from the money they actually do sink into research.

“They (also) don’t talk about the public funding that contributes to some of the development of these (drugs),” she says.

And so to conclude, I repeat what I said at the outset: I am not opposed to capitalism, only the unfettered kind which, it would seem, the charges attached to the treatment of orphan diseases are but egregious examples.

More Food For Thought

I am still working on my flooring, and as someone to whom the term handyman has little application, I am working very slowly. Therefore, in lieu of a post, I offer this wisdom from George Orwell:

A Question To Ask Any Day Of The Week

I'm working on installing some flooring in the house today, so for now, here is a question that deserves to be asked by all critical thinkers:

The Window Of Opportunity Is Growing Increasingly Short

So says Rajendra Pachauri, chair of the Intergovernmental Panel on Climate Change, if we are to take action to limit the global average temperature increase to two degrees Celsius:

Six years ago we said that emissions would have to peak by 2015 if we wanted to hold them to 2C. The cost rises the later you do it. Countries have to decide what would be the implications of inaction."

You can watch the brief video explanation here.

A Timely Reminder

In light of the National Energy Board's rubber stamping of the Enbridge Line 9 reversal with very few safeguards, here is a timely reminder of the inherent dangers of pipelines:

Post by West Coast Native News.

A New Motto For The Liberals and The NDP?

Many political observers and bloggers, including me, have lamented the fact that outside of style, little separates the policies of either the NDP or the Liberals from those of the Harper regime. Given their timidity when it comes to policy proclamations, the biggest clue to their abandonment of a progressive vision for the country lies in their use of language.

The following succinct letter from a Star reader speaks directly to that fact as it pertains to Mr. Trudeau's leadership, but of course is equally applicable to Mr. Mulcair:

Young Mr. Trudeau continually makes reference to the middle class when pronouncing his grand scheme of things. When did the term working class become derogatory?

The political magicians have used their smoke and mirrors to convince ordinary Canadians that everyone can climb through the glass ceiling into the world of the corporate elite. No one wants to label himself as a worker; it has become something very undesirable.

There is nothing wrong with honest work and getting one’s hands dirty; it is time we all pulled together so that no one needs to be without adequate food, clothing or shelter. Social democracy is not a dirty concept nor something to be feared. It is the way of the future.

Larry Rendall, Grimsby

Put another way, as John Kenneth Galbraith once said, Though power corrupts, the expectation of power paralyzes.

UPDATED: David Christopherson Rebukes Disruptive Tory Tactics; Pierre Poilievre Reassures All

Although the Opposition had been guaranteed uninterrupted testimony from Chief Electoral Officer Marc Mayrand on the 'Fair' Elections Act, they didn't get it.

David Christopherson, NDP MP from Hamilton Centre, offered this trenchant rebuke:




Meanwhile, on Power and Politics, Minister of State for Democratic Reform Pierre Poilevre made it clear that Mayrand's testimony, in which he stated his objections to the Act and proffered suggestions for amendments, fell on deaf ears. His response to all of them was essentially, "Everything is fine. Marc Maynard is wrong. No need for amendments."


UPDATE: In the above clip, among other things, Evan Solomon tries to point out that that there is absolutely no proof of electoral fraud having occurred. Therefore, the disallowance of Voter Identification Cards and vouching as acceptable forms of identification at the ballot box is unwarranted. In typically oily manner, Pierre Poilivre insists that a report commissioned by Elections Canada to review the problem of non-compliance with the rules for casting ballots pointed to wide-scale fraud. The author of the report, Harry Neufeld, former chief electoral officer for British Columbia, says that Poilievre is misrepresenting his report. You can read his rebuttal here.