Jewish World Review June 30, 2003 / 30 Sivan, 5763

Lewis A. Fein

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Consumer Reports

Prescription: Copy Cat | The most valuable resource within any home is the medicine cabinet, not the photo album or the attic's warehouse of heirlooms and priceless jewels. The medicine cabinet, a veritable vault of compounds and biochemical tools, is itself a testament of modernity: every newly constructed home -- almost as commonly presupposed as indoor plumbing or electricity -- contains a mirrored door toward self-preservation -- aspirin, insulin, vaccinations and nitroglycerin. Life!

But recently proposed Senate legislation known as the Gregg-Schumer bill (the Emerson-Brown resolution in the House is the dual image of the upper chamber's bad political tinkering) threatens to destroy the pharmaceutical industry's ability and overall incentive to further produce breakthrough medications. Both Gregg-Schumer and a version of Emerson-Brown are in the new Medicare drug benefits bills passed by Congress last week. This "poison pill" ideology deserves removal when Congress meets before its August recess to prepare a final bill for President Bush's signature.

First, let us also dispense with the falsely attractive arguments made by generic drug manufacturers, that affordability trumps all other considerations; that price - and price alone, regardless of the factors responsible for a drug's very existence - must determine healthcare policy. Which, of course, elicits a more obvious question: How can generic drug companies so easily discount the price of medications that, previously protected by important patent legislation, once cost considerably more? The answer is both clear and controversial -- generic drug manufacturers hardly spend a dime (nor devote the equally important energy) developing a single, new lifesaving drug. Call the entire process "Rewards through Cheating."

Yes, affordability is an important medical factor; and generic drugs contribute toward the democratization of healthcare. But limits on patent protections - the very guarantees that encourage the research, development and marketing of new medications - inevitably discourage further scientific breakthroughs. For example: reduced patent protections, worsened by generic manufacturers exploitation of another's advertising campaigns, wholly remove any incentive by brand-name companies to 1) invest billions of dollars in creating new drugs and 2) successfully market these same products.

Why should a brand-name company aggressively advertise a new drug - say, a new medication to fight diabetes - only to have generic manufacturers sell the product cheaper, with the name recognition already established elsewhere? So, one may buy today's drugs more affordably at the greater (and more lethal) expense of newer drugs never reaching shelves tomorrow. Remember: the creation of new drugs is a costly business, often an unsuccessful enterprise; promising discoveries typically yield disappointing results, great successes have many failed offspring.

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Even worse, generic companies typically manufacture their drugs overseas. There is nothing wrong or immoral about job creation, of course. But, a generic drug - a product developed through a competitor's own admirable research - and thereafter copied in a country like India, punishes American workers. The real "savings" is nonexistent, as U.S. workers find themselves increasingly threatened by innovation borrowed, unfairly licensed or morally stolen by foreign competitors. And the hidden costs ultimately mean fewer jobs and greater uncertainty at home.

The actual goal of healthcare policy - the entire purpose of patent protection - is to let the marketplace reward the risks taken in the laboratory, increased by the federal government and finally (thankfully) endorsed by medical patients nationwide -- that rightful workers deserve their duly earned recognition. Or, put another way, generic drugs may save a few dollars; they will never save a person's life. That challenge, the preservation of individual fulfillment, begins at the brand-name manufacturer's research, development, clinical trials and patient feedback. The generic companies have market research, not scientific discovery; consumer responses, not patient studies.

Fair economics demands that hard medical work deserves full patent protection. Anything short of total protection - anything that seeks to unjustly reward one company at the expense of another's time and sweat - is a threat to additional pharmaceutical discoveries. The current challenge requires a more realistic appraisal of generic manufacturers unfair practices. This opportunity warrants the nation's attention.

JWR contributor Lewis A. Fein is a writer and Internet entrepreneur in Los Angeles.Comment by clicking here.


© 2003, Lewis A. Fein