5 ms·

First, really appreciate the engagement here. This is a hugely important problem and this interview and your presentation of it is a great contribution. I thi

First, really appreciate the engagement here. This is a hugely important problem and this interview and your presentation of it is a great contribution. I think one of the things that gets lost when we talk about Eroom's law is that the original data points were established before congress passed the Kefauver-Harris amendments in 1962 which set standards for clinical trials, iNDA process, and basically required that drugs show efficacy before they could be marketed. An important part of those amendments is they made the drug companies go back and review the 4,000 drugs already on the market and provide evidence on their efficacy. It took FDA a long time to work through that backlog, but when they did: "In January 1968, the Drug Efficacy Study panels finally reported their conclusions to the FDA. They had reviewed over 16,500 therapeutic claims for 4,000 pre-1962 drugs. Only 434, about 12 percent of those examined, delivered on all their promised claims. Seven hundred and sixty-nine were marked as 'ineffective'" [0]. I bring that up to say two things: 1) Our baseline in examining Eroom's law is a bit skewed because standards have been going up since the graph begins. 2) We should be careful in how we change those standards. Many of them were bought with patients lives. I need to go now, but I do want to address your comment on pricing later. Thank you again. Really great work. [0] Pharma - Gerald Posner - Pg 224. https://www.amazon.com/Pharma-Greed-Lies-Poisoning-America-ebook/dp/B07THB8GRL/ref=tmm_kin_swatch_0?_encoding=UTF8&qid=1609177152&sr=8-1 https://www.amazon.com/Pharma-Greed-Lies-Poisoning-America-e...

refoundable 6y ago
No disagreement on the skewed stats. And I won't dispute the need for a minimum standard of efficacy. However, if anything, the problem that we've had over the last 60 years is setting the standard of efficacy too high. This caused the Better than the Beatles problem, and placed Pharma companies in an impossible situation where they have to run faster and faster just to stay in the same place. Moving forward, if we're not going to lower the efficacy standard, then the questions that Scannell raises about model validity and the search problem writ large become even more pressing and important. On the other hand, if we're not going to solve the search problem, then the pragmatic solution would be to lower the efficacy bar somewhat so Pharma companies can at least create slightly less effective but way cheaper drugs. In theory, we should be able to do both. In practice, we're likely to get one way before the other. The current path we're on of fewer drugs and higher prices is simply unsustainable.
- Dysseus 6y ago
  This is helpful. Let me ask a question. Why do you think that cheaper development costs will ultimately lead to lower drug prices? I think we would both agree that drugs are not priced based on cost. Even if R&D were 10X cheaper - all else equal - prices are not coming down. So what is the mechanism you think will lead to lower prices given lower costs of R&D? Another question: Maybe as a patient (or a doctor), I like the better than the beetles problem. I don't need a thousand drugs on the market to treat every indication. Especially ones that have not passed a high bar for efficacy. I need a few drugs, preferably outside of patent protection, with enough diversity in structure to avoid specific toxicity effects. If lowering the efficacy standards doesn't get me treatment for new indications, why would I want it? It's not clear to me that solving better than the beetles gets me to new indications. Presumably if I'm in a regime where BTTB applies, I've got a drug for that.
  - refoundable 6y ago
    > Why do you think that cheaper development costs will ultimately lead to lower drug prices? If the cost of drug development were to drop by a factor of 100-1000, say from the $3B it costs today to the $3-30M range, that would likely unleash a massive wave of decentralization in the industry that would make it very hard to justify outrageously high drug prices for long. However, short of a large drop of that magnitude, I agree that we'll probably continue to see Pharma companies charging as much as they can get away with and the political climate allows. > I don't need a thousand drugs on the market to treat every indication. [...] If lowering the efficacy standards doesn't get me treatment for new indications, why would I want it? It's true that the Better than the Beatles problem rewards consumers with cheaper drugs, but on the flipside, it robs them of the benefit of newer drugs. As a result, all the technical capabilities that the Pharma industry gained into developing drugs that are less toxic or better targeted do not get translated into consumer benefit when the BTTB problem is in the way. Moreover, once an area of drug development stops seeing new commercial success in decades, hysteresis sets in and can drive Pharma companies out of such areas, which has largely been the case with anti-infectives since the 1980s. (See Question 11 in the interview)

refoundable 6y ago

No disagreement on the skewed stats. And I won't dispute the need for a minimum standard of efficacy. However, if anything, the problem that we've had over the last 60 years is setting the standard of efficacy too high. This caused the Better than the Beatles problem, and placed Pharma companies in an impossible situation where they have to run faster and faster just to stay in the same place. Moving forward, if we're not going to lower the efficacy standard, then the questions that Scannell raises about model validity and the search problem writ large become even more pressing and important. On the other hand, if we're not going to solve the search problem, then the pragmatic solution would be to lower the efficacy bar somewhat so Pharma companies can at least create slightly less effective but way cheaper drugs. In theory, we should be able to do both. In practice, we're likely to get one way before the other. The current path we're on of fewer drugs and higher prices is simply unsustainable.

Dysseus 6y ago
This is helpful. Let me ask a question. Why do you think that cheaper development costs will ultimately lead to lower drug prices? I think we would both agree that drugs are not priced based on cost. Even if R&D were 10X cheaper - all else equal - prices are not coming down. So what is the mechanism you think will lead to lower prices given lower costs of R&D? Another question: Maybe as a patient (or a doctor), I like the better than the beetles problem. I don't need a thousand drugs on the market to treat every indication. Especially ones that have not passed a high bar for efficacy. I need a few drugs, preferably outside of patent protection, with enough diversity in structure to avoid specific toxicity effects. If lowering the efficacy standards doesn't get me treatment for new indications, why would I want it? It's not clear to me that solving better than the beetles gets me to new indications. Presumably if I'm in a regime where BTTB applies, I've got a drug for that.
- refoundable 6y ago
  > Why do you think that cheaper development costs will ultimately lead to lower drug prices? If the cost of drug development were to drop by a factor of 100-1000, say from the $3B it costs today to the $3-30M range, that would likely unleash a massive wave of decentralization in the industry that would make it very hard to justify outrageously high drug prices for long. However, short of a large drop of that magnitude, I agree that we'll probably continue to see Pharma companies charging as much as they can get away with and the political climate allows. > I don't need a thousand drugs on the market to treat every indication. [...] If lowering the efficacy standards doesn't get me treatment for new indications, why would I want it? It's true that the Better than the Beatles problem rewards consumers with cheaper drugs, but on the flipside, it robs them of the benefit of newer drugs. As a result, all the technical capabilities that the Pharma industry gained into developing drugs that are less toxic or better targeted do not get translated into consumer benefit when the BTTB problem is in the way. Moreover, once an area of drug development stops seeing new commercial success in decades, hysteresis sets in and can drive Pharma companies out of such areas, which has largely been the case with anti-infectives since the 1980s. (See Question 11 in the interview)