Medicine

'Corporate Money' Leads to Life-Saving Medical Discoveries

Activists obsessed with "conflict of interest" in science make life more difficult for doctors, and for patients who want cures.

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RDECOM/Flickr

I'm the underachiever in my family. My parents also produced Harvard Medical School research director Thomas Stossel. Mom called him the one who had "a real job."

For years, my brother annoyed me by not embracing the libertarianism that changed my life. It bored him. He was comfortable in his Harvard cocoon. But then he realized that the anti-capitalist activists who fight with me on my TV show are also the people who make life more difficult for doctors, and for patients who want cures.

Lately, the anti-capitalists have become obsessed with "conflict of interest" in science—any trace of corporate money must poison honest medical research.

Obamacare includes a rule called the Physician Payment Sunshine Act. It orders companies that make medical products to disclose even bagels they serve doctors and anything valued above $10. On my TV show this week, Tom calls that "the conflict of interest mania … taking normal competition … into a witch hunt."

But doesn't corporate money tempt doctors to push inferior treatments and drugs? "People cheat for money," replied Tom. "But evidence that collaborations compromise clinical integrity and patient care is practically nonexistent. A voluminous 2009 Institute of Medicine report on 'Conflict of Interest in Medical Research' was unable to find evidence of a negative effect on patient outcomes."

How much good comes from corporate/research collaboration? I assumed that most new drugs and improved medical treatments come because of government-funded research. Tom's reply:

"I've lived off government-funded research my whole life. I've panhandled off your tax money. It's important. But the vast predominance of what gets products to patients comes from the private sector."

His epiphany came when he did work for the biotech company Biogen. Its board included Nobel Prize winners. One helped develop the hepatitis vaccine.

That probably wouldn't happen today, says Tom, because now the stock options the Nobel winner got are forbidden at research institutions like Harvard.

But without government regulation, what prevents greedy doctors and greedy medical device makers or drug companies from colluding?

Market competition. Other scientists will try to replicate dramatic findings and debunk false claims and sloppy scientists. Companies worry about scandal, lawsuits, the Food and Drug Administration, and recalls. They can't get rich unless their reputation is good.

The scientific process doesn't work through activists swooping in and pretending to be the guardians of careful research. As Tom writes in a forthcoming book, "Science's credibility derives from its delivery of durable discoveries." Similarly, sustained profits require products that actually work. Currently, the conflict of interest zealots have won the debate. Obamacare regulators are implementing the Sunshine Act. Who wins from the new regulation?

"The Sunshine Act is a boondoggle for accountants, compliance bureaucrats, and the legions of lawyers whom companies will hire to manage the regulations," says Tom. "These parasites will muddle through endless complexities, such as which entity of a global company actually pays physicians and must report the payments. There will be the questions of how to identify which physicians are being paid for what, such as how to account for $25 worth of bagels brought into a group practice office when it's unclear who actually ate the bagels."

Who loses? Patients. Few have the competence to interpret the disclosures, and because of the new rules, they'll have fewer new drugs. Hundreds of millions of dollars once applied to innovation will shift to "Sunshine" management.

"Do you want your doctor pilloried for eating a corporate bagel while getting useful product information that might benefit you?" asks Tom.

"Do you want your hospital hiring compliance officers instead of nurses or laboratory technicians? Do you want medical researchers censured for being paid by industry for discoveries that might save your life? … This will benefit predators: the media who want to embarrass doctors, the lawyers who sue doctors, and drug companies."

Markets do not automatically taint science. As with every other service the market provides, it is the anti-capitalist attitude that does more harm.

NEXT: Another Study Finds No Evidence That Medical Marijuana Increases Cannabis Consumption by Teenagers

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  1. “Obamacare includes a rule called the Physician Payment Sunshine Act. It orders companies that make medical products to disclose even bagels they serve doctors and anything valued above $10. On my TV show this week, Tom calls that “the conflict of interest mania … taking normal competition … into a witch hunt.””

    So I’m guessing that no one in the Obama Administration follows the cluster fuck that is college sports closely enough to see just how poorly these types of rules actually work?

  2. any trace of corporate money must poison honest medical research.

    Yeah. Research can only be honest if it is funded by money acquired by coercion.

    1. Just as the administration of justice can only be honest or “work” if it is both monopolized and funded by coercion?

      1. “‘Tis impossible to be sure of any thing but Death and Taxes”
        -Benjamin Franklin

        1. Fucking bald headed, kite flying commie.

          1. Or just someone who recognized that in the real world there will always be a gang of thugs with the last word in violence who use that as a license to steal under the guise of taxes.

            1. Liberty Valance and Ransom Stoddard meet Tom Doniphon.

  3. Having done some consulting work in the field of drug fraud (pharma companies peddling ineffective cures as if they work), I think the big driver of fraud is the existence of patents of monopoly for pharmacological products coupled with the ever increasing regulatory costs involved in developing new drugs.

    In essence, when a company brings a new drug to market, they have to invest millions in not only the clinical trials but in setting up the manufacturing plant to produce the drug.

    To recoup those costs, they need to sell the drug at a much higher price than the cost of pressing the pill.

    This is difficult, because not many people can afford to pay this high price for the pills as treatment. So they try to come up with new markets for the drug. They may expand the duration of the patent protection by claiming to have identified other conditions that are treated by the drug. They try to promote off-label uses of the drug.

    And the looming expiry of patent protection and the need to wring as much money out of the drug before that date drives a great deal of bad science (ie. studies designed to give seemingly positive results).

    1. I think we would be better off if the patent protection were scrapped (getting rid of the FDA is a great idea as well). The initial effect of the elimination of patent protection would be very negative – for profit companies would stop the expensive R&D efforts because generic manufacturers would basically free-load off their research.

      However, charitable organizations like March of Dimes, the Easter Seals etc. would step into the breach, because they would want to see the diseases they focus on get cured. R&D would become a charitable activity.

      The treatments/cures hitting the market would become not the ones that are most patentable, but the ones that seemed most therapeutically successful. And the prices that patients would pay would be far lower.

      1. I think you’re very mistaken, tarran. Everyone who isn’t a complete denier of reality and human nature should understand that the profit motive is one of the best incentives and motivators for innovation there is. There is no way charity would be able to match it or exceed it. And there’s nothing wrong with that. But a huge number of people just cannot accept that and that distorts the shit out of the playing field via absurd laws and patent bullshit, and causes many of the perverted incentives you describe.

        I don’t believe in IP, but I understand why patents were thought to be a good way to spur innovation…because of the profit motive. The more and more that demented, reality-denying idiots and politicians refuse to accept that, though, the more the patent system becomes a problem rather than a catalyst.

        1. Don’t get me wrong, I am not trying to eliminate profits from R&D. I agree that the profit motive is a great spur for innovation.

          In the current regulatory regime, it’s pretty hard to research a new drug and to recoup the costs of testing it and getting FDA approval in the absence of a patent of monopoly.

          If the FDA were reigned-in dramatically or eliminated, then it would be a different story. I do think, however, you are underestimating the power of charities to raise money for R&D. Especially when a group of wealthy individuals or corporations could get their names associated with curing X.

          The current regime rewards people who produce the most patentable thing that seems to help treat X.

          My proposed regime would reward people who produces what is perceived at a given moment as the best treatment for X.

          There is a great deal of overlap between the two sets, but they are not identical ones.

          And my proposed regime delivers treatments at lower prices.

          1. One thing I think eliminating drug patenting and hyper-regulation would also do is dramatically raise the intelligence of the average consumer (both through education and elimination of the stupid).

            The FDA and patenting provide a false notion of ‘safe’ or ‘approved drugs’ and ‘approved manufacturers’ when, in reality, producing medicine and contracting/curing diseases is inherently risky.

            While risk can be minimized, it is *frequently* minimized at by limiting (or delaying) the freedom to seek more effective treatments.

        2. “Everyone who isn’t a complete denier of reality and human nature should understand that the profit motive is one of the best incentives and motivators for innovation there is”

          Yes but innovation != best new medicines. There are a great many ways to innovate and there is no requirement from the profit motive that you innovate in such a way that cures a specific disease the best.

          In fact one of the few good criticism’s that progressives have about corporate drug research is that curing a disease is significantly less profitable than maintaining it.

          This is not to buy into a conspiracy theory that drug companies have buried proof that natural remidies can cure everything but when they are deciding where to allocate their research dollars which do you think gets funded…

          1) A potential new Cholesterol lowering drug that provides a marginal improvement over existing medications of that class which patients who need it will have to take for the rest of their lives.

          2) A permanent cure for Sickle cell Anemia

          1. What if 90% of the drug company’s shareholders are the issue of sharecroppers?

            Ah, in such a case, it would be interesting to see which color would prevail.

            1. Well SEC regulations prevent stockholders from exercising any direct management of the companies day to day operations. The CEO on the other hand would in theory have the power to direct research to his personal pet diseases but since he has a fiduciary responsibility to maximize shareholder value and could at least in theory go to jail for doing so I’m betting that Green wins over Black 99 times out of 100.

              1. I assume you are talking about a publicly traded company?

                Stockholders of closely held corporations can most certainly exercise direct managerial control over day-to-day operations.

                Nevertheless, even in the closely held realm, your bet seems right.

          2. In fact one of the few good criticism’s that progressives have about corporate drug research is that curing a disease is significantly less profitable than maintaining it.

            Using taxpayer dollars doesn’t resolve this issue and this isn’t a conspiracy or a theory. Cigarettes and smoking could be outright eliminated (not that I’m proposing it), instead taxes are collects on the premise of both causing and treating the lung cancer.

            The biggest difference I see is that under the current patenting regime, if I have the knowledge and capability to cure myself and my neighbors of a, disease even without desire for profit, I am compelled to forgo that solution and purchase the drug direct from a/the manufacturer. See e-cigarettes.

            1. But Tarran’s comment that I was responding to (and supporting) did not suggest using taxpayer dollars. He specifically suggested using charitable donations

              1. Sorry if I wasn’t clear;

                *Ahem*, and I quote; “one of the few good criticism’s that progressives have about corporate drug research is that curing a disease is significantly less profitable than maintaining it.

                In fact, this isn’t a good criticism because, *if* the latter portion is true, it is true regardless of the funding source.

                Also, it’s only true in any common or sensible fashion if you additionally *assume* frequent stable bizarre contortions of collusion amongst competitors (which are already otherwise regulated) and stupid types of fungibility like High Cholesterol = Sickle Cell Anemia.

      2. getting rid of the FDA is a great idea as well

        The FDA, like many gov’t organizations, was conceived as a reactionary measure to widespread fraud. It had a purpose. Unfortunately, it has adapted that purpose to be proactive, an inherently unstable and unsustainable model.

        1. Its purpose was control and payola.

        2. The FDA, like many gov’t organizations, was conceived as a reactionary measure to widespread fraud.

          It’s a little known fact, Normie, that the Consumer Union (publisher of Consumer Reports) and the AMA at their inception had testing drugs for efficacy and safety as a big part of their charter. Absent the morphing of the Chemical Board into the FDA, I think they’d be doing it still, and doing a better job as well.

          1. Yes, there’s no reason we can’t have private certification. In fact, that does exist for some things. Like UL, for instance. Not that government doesn’t have it’s icky hands in everything, but it doesn’t have to.

          2. Absent the morphing of the Chemical Board into the FDA, I think they’d be doing it still, and doing a better job as well.

            I didn’t mean to insinuate that it couldn’t be done or done better privately.

            I mean/meant that they had a purpose and depending on how you conceive of the USDA’s birthing of the FDA, they filled a consumer niche that the market didn’t or couldn’t fill competently for a couple decades.

            I admit that I may be starting the debate too early, how about we resume it again when the Federal Gov’t is talking about cutting the last 50-100 chemists?

            1. Markets fill every niche and attend to every human need automatically and with perfect efficiency, and they never fail. Except when any amount government is around, then markets wilt like the daintiest of flowers, of course.

              1. Only statists think perfection is obtainable.

              2. Tony, OT, but, your recent attacks upon sarc have not escaped my attention.

                FYI, he should be near the bottom of your list of posters to attack on this board.

                Why? Because (1) he is one of the nicest guys who has ever been a regular here and (2) he usually will accord you some intellectual due process before hanging you.

                1. Muchas Garcias LM.

                2. Really? He’s always a horrid bitch to me.

                  1. Really? He’s always a horrid bitch to me.

                    I usually give you one or two chances to be intellectually honest before I tear you a new asshole.

              3. Markets fill every niche and attend to every human need automatically and with perfect efficiency, and they never fail. Except when any amount government is around, then markets wilt like the daintiest of flowers, of course.

                I have to ask people: is the amount of straw Tony created in that statement so dangerously combustible that it should be classified as an infernal machine?

                Let us discuss…

              4. then markets wilt like the daintiest of flowers

                Actually, if you had been paying attention, the assertion isn’t that they wilt. It’s that copious amounts of rather expensive government intervention have quite competently turning a field of wildflowers and weeds into a pleasant thicket of briars.

                Remind me again what branch of government, government run institutions, or predominantly publicly (tax) funded organizations John Snow, Edward Jenner, and Louis Pasteur were employed by?

                1. But I thought Jon Snow knew nothing?

              5. Markets fill every niche and attend to every human need automatically and with perfect efficiency, and they never fail. Except when any amount government is around, then markets wilt like the daintiest of flowers, of course.

                That’s weapon’s grade straw, that is.

                Markets work because bad ideas are allowed to fail, and when they fail they go away.

                Not so with government. When government policy fails it never goes away. It may be modified or added to, but it never goes away. It just continues to fail and fuck up everything it touches.

                1. Not with good government.

                  If markets do not create optimal outcomes, then why is it so bad to attempt to correct them?

                  Lemme guess, because coercion is bad (except when you need it).

                  1. If markets do not create optimal outcomes, then why is it so bad to attempt to correct them?

                    Define what it means to not have an optimal outcome. Optimal to whom?

                    What is not optimal to a producer might be optimal to the consumer. For example foreigners can produce certain widgets cheaper than domestic companies. That’s not optimal for domestic companies, so they get the government to impose a tariff.

                    What about consumers? Now they have to pay more every time they buy that widget. How is that optimal for them?

                    The vast majority of the time, when someone says markets don’t have optimal outcomes, they mean that someone doesn’t like having competition. They get government to enact policy that will benefit them, but it is always at the expense of the consumer.

                  2. Not with good government.

                    Well, yeah. Good government enforces property rights and contracts, provides courts to resolve disputes without resorting to violence, and otherwise markets alone.

                    So yeah. Good government doesn’t fuck up markets because it leaves them alone.

              6. Shut your pie hole, you vile, immoral, scum.

      3. How about we get rid of the FDA but keep the patent office (while killing the rest of Commerce)?

        1. Because patents of monopoly are terrible at spurring innovation and leave all of society poorer?

  4. I like money.

    1. Brought to you by Carl’s Jr…

  5. Remember guys, any research funded by corporate money is bad, mkay? Only research funded by government is *real* science. I know this because progressives like Tony say so, and also because there is never an incentive to mislead/lie when receiving taxpayer dollars.

    Unless you’re a VA medical facility administrator.
    Or a recipient of “farm” money.
    Or the head of the NSA.
    Or…

    1. The for-profit sector does not tend to make basic research a priority because it is not concerned with long-term payoffs.

      1. The for-profit sector does not tend to make basic research a priority because it is not concerned with long-term payoffs.

        This is only true in the minds of communists and stands in direct opposition to Rasilio’s notion above that corporations have a vested interest in keeping people sicker, longer (a long-term payoff).

        Please explain how Coca-Cola or Ford is less interested in long-term payoff than the FDA or the IRS.

  6. Have I mentioned I like Stossel?

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