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Is curing patients a sustainable business model for the pharmaceutical industry?

A recent CNBC piece (1) commented on a note by a Goldman Sachs analyst to clients in the pharmaceutical industry. In a report titled “The Genome Model” the analyst asks “Is curing patients a sustainable business model?” Cures, the analyst opined, might be good for patients but bad for business. What the pharmaceutical industry needs are therapies for chronic incurable – or intentionally uncured – diseases.

I somehow don’t think that this piece was meant to be seen by the general public. After all, we are expected to rely on the pharmaceutical industry, the supposed bastions of evidence-based medicine, to cure us when we are sick. Healing us should be the very purpose of their existence.

I also don’t think that Big Pharma needed that advice – they have long ago figured this out themselves and made it their business model. If you don’t believe that the “health” industry – and that is what the pharmaceutical industry insists it is – would actually harm us for the sake of power and profit, then have a look at a 2012 article in the New England Journal of Medicine titled Punishing health care fraud – is the GSK settlement sufficient? (2).

That article was prompted by the 3 billion dollar fine levied against GlaxoSmithKline for various criminal offenses. It was then a record settlement, but it was just the latest in a string of drug company indictments. Fines in the previous three years had totaled $11 billion in the U.S. for offenses like

  • kickbacks,
  • off-label promotion,
  • failure to provide information about side effects, and
  • false and misleading statements about safety

The failure to provide information about drug safety and side effects has caused, and continues to cause, the deaths of thousands of patients!

How could this happen again and again? For the very simple reason that, so far at least, no Big Pharma executive has ever been held responsible for these crimes; no matter what they do, they get away scot-free. I wasn’t their fault, you see. The company did it!

Corporate fines are no major problems either, since they are typically less than company profits from their illegal activities. Corporate crime is simply good business practice.

One has to wonder if it ever occurred to our brilliant Goldman Sachs analyst that he or a family member might someday be saved by medications that, he now thinks, should not be developed. Or is he willing to sacrifice himself and his loved ones for a greater cause – Big Pharma profits?

 

Sources:

  1. Tae Kim, Goldman Sachs asks in biotech research report: ‘Is curing patients a sustainable business model?’ https://www.cnbc.com/2018/04/11/goldman-asks-is-curing-patients-a-sustainable-business-model.html?__source=sharebar|facebook&par=sharebar (link works)
  2. Outterson K, Punishing health care fraud – is the GSK settlement sufficient?N Engl J Med 2012; 367:1082-1085https://www.nejm.org/doi/full/10.1056/NEJMp1209249

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