8 ms·

"Antibiotics present an enduring economic puzzle. These drugs changed the world. Yet despite their unique power, the free market doesn’t value them." No. The f

by wooby 6y ago

"Antibiotics present an enduring economic puzzle. These drugs changed the world. Yet despite their unique power, the free market doesn’t value them." No. The free market -- people -- values these drugs. If there wasn't demand, this article wouldn't have been written. The problem is that drugs are too expensive to bring to market for their developers to profit, and that the single greatest cost is often FDA approval. The article implies that the solution is to funnel more BARDA grants to companies in order to make drug development profitable. This amounts to using taxpayer money to help private companies pay government fees, with lots of bureaucratic overhead (employees, forms, computer systems, buildings) at each end of the transaction. This is dramatically suboptimal. Instead of this, the FDA process should be cheaper, or the FDA itself should be privatized, and operate as an entity like Consumer Reports or any other review organization. Government need only be involved with prosecuting fake producers. The consumer requires only access to information, and assurances that a substance they bought is the same they have researched. Paying government expenses with taxes is an unsustainable Ponzi scheme, and takes us further away from a real solution.

digdugdirk 6y ago
The FDA approval process ensures both that drugs perform an intended function, and that drugs don't harm people. Part of the expense of this process is making sure that both of these aspects are performed to sufficient standards. It sounds like your suggestion would lower the bar for both these aspects, and only catch issues after the fact - something which could have fatal consequences. I'm curious how you would see this playing out in a positive light, particularly given the money involved and the incentives to game the system.
- michaniskin 6y ago
  Drugs are not somehow different from any other type of product. All products have some level of risk to the consumer, and may or may not do what they're advertised to do. The Car & Truck Administration (CTA) approval process ensures both that cars and trucks perform an intended function, and that cars and trucks don't harm people. Part of the expense of this process is making sure that both of these aspects are performed to sufficient standards. And yet, we don't seem to need an FDA of cars and trucks costing auto manufacturers $1.4B to develop a new car, and our cars don't explode and kill us. The reason? A car maker who makes unsafe cars goes out of business. Consider Ralph Nader's "Unsafe At Any Speed" did to the Corvair corporation.
  - sithadmin 6y ago
    Uh, what? In the US, the NHTSA and DOT enforce rather rigorous safety standards, and this requires automakers to front relatively expensive R&D and certification costs. It's a huge (and given the history of motor vehicle safety, necessary) barrier to market entry.
    - wooby 6y ago
      Like the FDA, and as monopolies, NHTSA and DOT have much less stake in the safety of a consumer than do either car producers and drivers. Personally, I trust myself not to buy a car that I've heard explodes. You may not, and I respect that. But I see no reason to pay for a service that assures you when I myself require no such assurance. If NHTSA and DOT operated like UL, products that were less safe probably wouldn't have NHTSA or DOT seals, and those products would be much cheaper. People willing to trade safety for cost would be able to own a car. People willing to pay for safety would pay more. Because of the lower barrier to production, there would be probably much greater choice in car buying, and cars would be universally cheaper. In either case, the choice would rest with individual consumers, who know best their situation and risk tolerance.
      - sithadmin 6y ago
        You're completely ignoring the fact that consumer choices about automobile safety have externalities beyond the buyer. Sure, maybe you and I care enough about auto safety standards to buy a vehicle that isn't dangerous, but I don't trust other consumers to necessarily do the same thing. I don't want to be sharing the road with some corner-cutting jalopy that's likely to throw a tire through my windshield while we're passing each other on the highway, and I definitely don't want a market that permits such low-quality products to be operated in public spaces.
        wooby 6y ago
        I can think of a few systems in place that mitigate cases like the one you mention. First, I can think of very few things that could happen to someone's car that would disadvantage you without disadvantaging them. In the case you mention, the missing tire would render the jalopy inoperable, and so the buyer suffers for their poor choice of vehicle. Any buyer thus factors reliability and safety into their decision, whether or not they are particularly concerned about the safety of others. Plus, now they have to walk, and you probably won't be giving them a ride. A counter-argument to this would be effect on climate, an externality that's maybe best left out for now :-) Second, individuals may sue other individuals for personal or property damage. So, at least one factor preventing everyone from terrorizing you with their jalopies is that they are liable for damage their jalopy causes to others. The decision to purchase a jalopy includes this risk, disincentivizing the purchase of dangerous (to others) vehicles. Third, it's already a requirement in most jurisdictions that drivers are insured because of the above liability, and insurance companies could easily deny coverage to unsafe vehicles, as determined by any (private) mutually agreed 3rd NHTSA/DOT-like party. Finally, because there is no competition in the area of safety certification, it seems highly unlikely that the government's assessments of risk correspond to the risk assessed by the average consumer. The fact that most people choose to drive used vehicles that don't meet the government's latest safety standards feels like implicit proof of this.
- wooby 6y ago
  Pharmaceutical companies have every incentive to make their drugs safe, because if their drugs hurt people, the drugs will not sell. Many drugs have passed FDA approval but later killed people. If the FDA were a private company, it might have gone out of business. But as a government monopoly, it's very hard to stop paying for. Between pharma companies, the government, and individual patients, the FDA has the least stake in the health of a particular patient. UL is an example of a non-government organization that offers product safety certification. You see the UL seal on most consumer electric appliances. Imagine an FDA seal. Drugs are not magical or special. They are a product like any other, and it is the consumer's right to choose a doctor, and for that doctor to choose proper medication. We regularly choose the best mechanics, plumbers, and other specialists we can find, and their reputation is partly a function of the type and quality of the parts and tools they use.
  - sithadmin 6y ago
    If you want to see where this kind of free-wheeling approach to cGMP certification and product quality gets you - just take a look at the developing world, where big-name generics manufacturers knowingly dump subpar-quality (or even outright dangerous or ineffective) drugs on the market with impunity. This leads to all sorts of unsavory outcomes, and puts healthcare providers in the position of resorting to incredibly unscientific approaches to dosage management (it's not uncommon for physicians in such cases to recommend dosages many times in excess of what's recommended due to extremely poor active ingredient potency, based mainly on strictly qualitative feedback from patients). It effectively reduces the pharmaceutical market to a guessing game. The quality issues seen in the developing world are also directly linked to antibiotics usage practices that directly contribute to development of resistant strains of bacteria.
    - wooby 6y ago
      It is my understanding that malnutrition, clean water, and access to education/information are foremost among the problems of the developing world, and it's not at all clear to me that regulating medication in those countries would improve anyone's situation measurably. For my part, here in the "developed" world, I have a family member with a rare autoimmune condition, and access to comparatively few medications. Those that are available are very expensive and not covered by any insurance. There is little competition between their manufacturers. Because it costs at least 1.4B to bring a drug to market, and because of the rarity of her illness, it's unlikely any company will pursue new research. Thanks to the FDA's inordinately expensive approval process, no company is incentivized to bring a drug to market with an upside of <= 1.4B, regardless of how many people it could help.
- tetrometal 6y ago
  > It sounds like your suggestion would lower the bar for both these aspects, and only catch issues after the fact - something which could have fatal consequences. The other side of this is: 1) Since the FDA is a monopoly, it's entirely possible (and probably demonstrable) that they've set the wrong bars, which could have fatal consequences. 2) It's arguable that the costs imposed by the FDA may have fatal consequences themselves, in the form we're seeing today, where life-saving drugs (antibiotics, in this case) can't be developed because of them. I'm interested in hearing your response to the above two points. I'd also be interested to hear what you'd think of a "de-fanged" FDA wherein they are able to approve or disapprove medications, but are not able to enforce those decisions. People would be allowed to do with their own bodies as they please, but they'd be able to reference the FDA to make those decisions.
  - wooby 6y ago
    Your concept of a de-fanged FDA reminds me of the NTSB and is interesting to think about.
jorblumesea 6y ago
The FDA provides an essential role in verifying the safety of medications and their standards are high because people lives matter. The reality is that drug development is hard and failure percentage is high. Don't blame the FDA for that. Getting the government out of the picture will either increase the danger to the public with relaxing regulations or have negligible impact on drug development because most drugs fail anyways.
- michaniskin 6y ago
  I think it's totally fair to blame the FDA, as it's a monopoly. No entrepreneur is allowed to compete with them and they have no obligation to the consumer -- their only obligations are to politicians. So naturally the costs are sky high and their services don't align with what the consumer wants. "Peoples lives matter" is meaningless nonsense, and even taken at face value does not imply standards should be high. Remember that high costs and overly restrictive rules introduce delays and prevent drugs from reaching the consumer, and people are harmed and die because of this. How do we know when the FDA procedures are too restrictive? Well, we can't! Only the consumer can make those tradeoffs for him/herself and communicate their needs and desires via their preferences when selecting products where there are alternatives. With the FDA being a government monopoly there is no such feedback loop, so we just don't know how well their procedures actually align with what the people need. It's depressing to see how many Americans believe that if something "matters" the only option is to have the government micromanage it. If you're not American then I understand, of course.
  - jorblumesea 6y ago
    How could there not be a monopoly on public safety? The state and the government should have the final word on all things public safety related. Trusting private corporations or companies with public safety is insane. It's sad and hilarious that Americans truly believe that the government, who is accountable to the electorate, should be somehow disabused of those role simply because it doesn't work as well as they'd like. You know, instead of reforming it or fixing the problems we have. The Libertarian "let the free market work" is just complete garbage and history has shown time and time again this doesn't work and will never work.
orev 6y ago
You start going in the right direction by talking about the cost of the FDA process, but then veer off into the weeds with a solution from extreme Libertarianism. History has shown over and over and over again that this type of hands-off approach and “let the consumer decide” mumbo jumbo absolutely does not work. It’s just as debunked as the trickle down economics theories. They have been tried so many times and failed every time. If I’m in the ER am I supposed to stop and check every single drug they give me before having emergency surgery? Is the hospital? Would we give the right for every citizen in the country to inspect the premises of every drug manufacturer? So now anyone must be allowed to walk into any factory whenever they want to see what’s going on? How should any layperson be expected to have the knowledge and expertise to even perform an evaluation? I can imagine some kind of review site where people post 1-star reviews like “took drugs, died anyway”. How many bad reviews/people dead would you say should be enough for a company to be removed?
- wooby 6y ago
  If you have any choice in how you are treated, you will make your best judgement based on information available to you, such as by the recommendation of a friend, or a Yelp review. This is the same process you use to make any important purchase. Before you have work done on your car, do you fly to China to inspect the part factory? You don't, because the relatively low risk you perceive that these parts will fail doesn't justify the expense of travel. Do you perceive low risk because a government agency put a stamp of approval on the part? Probably not. Most likely, your risk assessment is based on information you've gathered about the final product, the auto shop -- that it is well-reviewed, and that your mechanic seems knowledgeable. Furthermore, only you really know your exact needs. An expensive high-performance car part might provide you some marginal benefit, but not so much benefit that you're willing to buy that part at the expense of something else that's important to you, like your electric bill. A race car or Uber driver might make a different decision and choose a different part to suit their needs. Medicine is like car parts. Bad ones can kill. But through the free market, a system of feedback is established that tends toward a wider variety, and higher quality, of parts overall. When politicians prioritize some drugs over others, they interfere with this system, and money is spent on drugs and research that people don't necessarily want or need. You can imagine race car drivers getting together and lobbying politicians to subsidize high performance parts. Because these subsidies are funded by taxes, money is effectively taken from individuals who might prefer a different part. Now, those individuals who are not race car drivers have less purchasing power, and fewer choices overall. You're correct that this is more or less the libertarian perspective, but I find it in no way extreme. I find it principled, direct, and humane. In our society, where nearly everyone has a smart phone and may conduct research at any time, I can't imagine a more effective system. I'm sure it was much easier to criticize the free market in a time when people couldn't read, or didn't have a global information database accessible on their person at every waking moment.

by wooby 6y ago

digdugdirk 6y ago

The FDA approval process ensures both that drugs perform an intended function, and that drugs don't harm people. Part of the expense of this process is making sure that both of these aspects are performed to sufficient standards. It sounds like your suggestion would lower the bar for both these aspects, and only catch issues after the fact - something which could have fatal consequences. I'm curious how you would see this playing out in a positive light, particularly given the money involved and the incentives to game the system.

michaniskin 6y ago
Drugs are not somehow different from any other type of product. All products have some level of risk to the consumer, and may or may not do what they're advertised to do. The Car & Truck Administration (CTA) approval process ensures both that cars and trucks perform an intended function, and that cars and trucks don't harm people. Part of the expense of this process is making sure that both of these aspects are performed to sufficient standards. And yet, we don't seem to need an FDA of cars and trucks costing auto manufacturers $1.4B to develop a new car, and our cars don't explode and kill us. The reason? A car maker who makes unsafe cars goes out of business. Consider Ralph Nader's "Unsafe At Any Speed" did to the Corvair corporation.
- sithadmin 6y ago
  Uh, what? In the US, the NHTSA and DOT enforce rather rigorous safety standards, and this requires automakers to front relatively expensive R&D and certification costs. It's a huge (and given the history of motor vehicle safety, necessary) barrier to market entry.
  - wooby 6y ago
    Like the FDA, and as monopolies, NHTSA and DOT have much less stake in the safety of a consumer than do either car producers and drivers. Personally, I trust myself not to buy a car that I've heard explodes. You may not, and I respect that. But I see no reason to pay for a service that assures you when I myself require no such assurance. If NHTSA and DOT operated like UL, products that were less safe probably wouldn't have NHTSA or DOT seals, and those products would be much cheaper. People willing to trade safety for cost would be able to own a car. People willing to pay for safety would pay more. Because of the lower barrier to production, there would be probably much greater choice in car buying, and cars would be universally cheaper. In either case, the choice would rest with individual consumers, who know best their situation and risk tolerance.
    - sithadmin 6y ago
      You're completely ignoring the fact that consumer choices about automobile safety have externalities beyond the buyer. Sure, maybe you and I care enough about auto safety standards to buy a vehicle that isn't dangerous, but I don't trust other consumers to necessarily do the same thing. I don't want to be sharing the road with some corner-cutting jalopy that's likely to throw a tire through my windshield while we're passing each other on the highway, and I definitely don't want a market that permits such low-quality products to be operated in public spaces.
      - wooby 6y ago
        I can think of a few systems in place that mitigate cases like the one you mention. First, I can think of very few things that could happen to someone's car that would disadvantage you without disadvantaging them. In the case you mention, the missing tire would render the jalopy inoperable, and so the buyer suffers for their poor choice of vehicle. Any buyer thus factors reliability and safety into their decision, whether or not they are particularly concerned about the safety of others. Plus, now they have to walk, and you probably won't be giving them a ride. A counter-argument to this would be effect on climate, an externality that's maybe best left out for now :-) Second, individuals may sue other individuals for personal or property damage. So, at least one factor preventing everyone from terrorizing you with their jalopies is that they are liable for damage their jalopy causes to others. The decision to purchase a jalopy includes this risk, disincentivizing the purchase of dangerous (to others) vehicles. Third, it's already a requirement in most jurisdictions that drivers are insured because of the above liability, and insurance companies could easily deny coverage to unsafe vehicles, as determined by any (private) mutually agreed 3rd NHTSA/DOT-like party. Finally, because there is no competition in the area of safety certification, it seems highly unlikely that the government's assessments of risk correspond to the risk assessed by the average consumer. The fact that most people choose to drive used vehicles that don't meet the government's latest safety standards feels like implicit proof of this.
wooby 6y ago
Pharmaceutical companies have every incentive to make their drugs safe, because if their drugs hurt people, the drugs will not sell. Many drugs have passed FDA approval but later killed people. If the FDA were a private company, it might have gone out of business. But as a government monopoly, it's very hard to stop paying for. Between pharma companies, the government, and individual patients, the FDA has the least stake in the health of a particular patient. UL is an example of a non-government organization that offers product safety certification. You see the UL seal on most consumer electric appliances. Imagine an FDA seal. Drugs are not magical or special. They are a product like any other, and it is the consumer's right to choose a doctor, and for that doctor to choose proper medication. We regularly choose the best mechanics, plumbers, and other specialists we can find, and their reputation is partly a function of the type and quality of the parts and tools they use.
- sithadmin 6y ago
  If you want to see where this kind of free-wheeling approach to cGMP certification and product quality gets you - just take a look at the developing world, where big-name generics manufacturers knowingly dump subpar-quality (or even outright dangerous or ineffective) drugs on the market with impunity. This leads to all sorts of unsavory outcomes, and puts healthcare providers in the position of resorting to incredibly unscientific approaches to dosage management (it's not uncommon for physicians in such cases to recommend dosages many times in excess of what's recommended due to extremely poor active ingredient potency, based mainly on strictly qualitative feedback from patients). It effectively reduces the pharmaceutical market to a guessing game. The quality issues seen in the developing world are also directly linked to antibiotics usage practices that directly contribute to development of resistant strains of bacteria.
  - wooby 6y ago
    It is my understanding that malnutrition, clean water, and access to education/information are foremost among the problems of the developing world, and it's not at all clear to me that regulating medication in those countries would improve anyone's situation measurably. For my part, here in the "developed" world, I have a family member with a rare autoimmune condition, and access to comparatively few medications. Those that are available are very expensive and not covered by any insurance. There is little competition between their manufacturers. Because it costs at least 1.4B to bring a drug to market, and because of the rarity of her illness, it's unlikely any company will pursue new research. Thanks to the FDA's inordinately expensive approval process, no company is incentivized to bring a drug to market with an upside of <= 1.4B, regardless of how many people it could help.
tetrometal 6y ago
> It sounds like your suggestion would lower the bar for both these aspects, and only catch issues after the fact - something which could have fatal consequences. The other side of this is: 1) Since the FDA is a monopoly, it's entirely possible (and probably demonstrable) that they've set the wrong bars, which could have fatal consequences. 2) It's arguable that the costs imposed by the FDA may have fatal consequences themselves, in the form we're seeing today, where life-saving drugs (antibiotics, in this case) can't be developed because of them. I'm interested in hearing your response to the above two points. I'd also be interested to hear what you'd think of a "de-fanged" FDA wherein they are able to approve or disapprove medications, but are not able to enforce those decisions. People would be allowed to do with their own bodies as they please, but they'd be able to reference the FDA to make those decisions.
- wooby 6y ago
  Your concept of a de-fanged FDA reminds me of the NTSB and is interesting to think about.

jorblumesea 6y ago

The FDA provides an essential role in verifying the safety of medications and their standards are high because people lives matter. The reality is that drug development is hard and failure percentage is high. Don't blame the FDA for that. Getting the government out of the picture will either increase the danger to the public with relaxing regulations or have negligible impact on drug development because most drugs fail anyways.

michaniskin 6y ago
I think it's totally fair to blame the FDA, as it's a monopoly. No entrepreneur is allowed to compete with them and they have no obligation to the consumer -- their only obligations are to politicians. So naturally the costs are sky high and their services don't align with what the consumer wants. "Peoples lives matter" is meaningless nonsense, and even taken at face value does not imply standards should be high. Remember that high costs and overly restrictive rules introduce delays and prevent drugs from reaching the consumer, and people are harmed and die because of this. How do we know when the FDA procedures are too restrictive? Well, we can't! Only the consumer can make those tradeoffs for him/herself and communicate their needs and desires via their preferences when selecting products where there are alternatives. With the FDA being a government monopoly there is no such feedback loop, so we just don't know how well their procedures actually align with what the people need. It's depressing to see how many Americans believe that if something "matters" the only option is to have the government micromanage it. If you're not American then I understand, of course.
- jorblumesea 6y ago
  How could there not be a monopoly on public safety? The state and the government should have the final word on all things public safety related. Trusting private corporations or companies with public safety is insane. It's sad and hilarious that Americans truly believe that the government, who is accountable to the electorate, should be somehow disabused of those role simply because it doesn't work as well as they'd like. You know, instead of reforming it or fixing the problems we have. The Libertarian "let the free market work" is just complete garbage and history has shown time and time again this doesn't work and will never work.

orev 6y ago

You start going in the right direction by talking about the cost of the FDA process, but then veer off into the weeds with a solution from extreme Libertarianism. History has shown over and over and over again that this type of hands-off approach and “let the consumer decide” mumbo jumbo absolutely does not work. It’s just as debunked as the trickle down economics theories. They have been tried so many times and failed every time. If I’m in the ER am I supposed to stop and check every single drug they give me before having emergency surgery? Is the hospital? Would we give the right for every citizen in the country to inspect the premises of every drug manufacturer? So now anyone must be allowed to walk into any factory whenever they want to see what’s going on? How should any layperson be expected to have the knowledge and expertise to even perform an evaluation? I can imagine some kind of review site where people post 1-star reviews like “took drugs, died anyway”. How many bad reviews/people dead would you say should be enough for a company to be removed?

wooby 6y ago
If you have any choice in how you are treated, you will make your best judgement based on information available to you, such as by the recommendation of a friend, or a Yelp review. This is the same process you use to make any important purchase. Before you have work done on your car, do you fly to China to inspect the part factory? You don't, because the relatively low risk you perceive that these parts will fail doesn't justify the expense of travel. Do you perceive low risk because a government agency put a stamp of approval on the part? Probably not. Most likely, your risk assessment is based on information you've gathered about the final product, the auto shop -- that it is well-reviewed, and that your mechanic seems knowledgeable. Furthermore, only you really know your exact needs. An expensive high-performance car part might provide you some marginal benefit, but not so much benefit that you're willing to buy that part at the expense of something else that's important to you, like your electric bill. A race car or Uber driver might make a different decision and choose a different part to suit their needs. Medicine is like car parts. Bad ones can kill. But through the free market, a system of feedback is established that tends toward a wider variety, and higher quality, of parts overall. When politicians prioritize some drugs over others, they interfere with this system, and money is spent on drugs and research that people don't necessarily want or need. You can imagine race car drivers getting together and lobbying politicians to subsidize high performance parts. Because these subsidies are funded by taxes, money is effectively taken from individuals who might prefer a different part. Now, those individuals who are not race car drivers have less purchasing power, and fewer choices overall. You're correct that this is more or less the libertarian perspective, but I find it in no way extreme. I find it principled, direct, and humane. In our society, where nearly everyone has a smart phone and may conduct research at any time, I can't imagine a more effective system. I'm sure it was much easier to criticize the free market in a time when people couldn't read, or didn't have a global information database accessible on their person at every waking moment.