Tuesday, January 17, 2012

Lifestyle Diseases 12: On Fat Filipinos

A cardiologist friend, Dr. Tony Leachon, former medical director of Pfizer Philippines and now a P1 a year consultant to the DOH on non-communicable diseases (NCDs), sent me three of his recent papers on NCDs. He gave me permission to post these in my blog. This is the first and shorter paper. Thanks Tony.

Photos below, I got them from the web, Fierce Fat Filipina Diva, and Fat People of Color. Meaning these are publicly available, voluntarily posted by their authors, I did not steal these shots. Photos added to illustrate the issue that Tony is discussing.
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Fat Filipinos not Funny at all : Young and Poor Affected

Anthony C.Leachon, MD
Philippine College of Physicians

In the Philippines, studies on obesity among children and in adults show that the findings reveal a sad and disturbing pattern. The prevalence rate of obesity has been increasing through the years. The Philippine National Health Evaluation and Survey (2004) has placed the prevalence rate of obesity among Filipino children at 3.2%. This has increased to 4.9% in 2003. Opina (2005) claimed that the gradual increase in the incidence of obesity was likewise noted by the National Nutrition Council of the Philippines survey in 2003. Overweight children aged 0-5 years rose from 0.4% to 1.4%. The prevalence rate of overweight children aged 6-10 years was almost negligible in 1998 but had a significant increase to 1.3% in 2003. Mayuga (2005) however said that the results of a survey conducted by the Food and Nutrition Research Institute (FNRI) of the Department of Science and Technology are more alarming. It was revealed that in 1989, the prevalence rate of obesity among Filipino children was at 5.7%. In 1993 it increased to 8% and in 1998 to 8.8%.

In the schools, malls, and in the clinics, we are seeing more and more obese patients than the last few years through determination of high body mass index (BMI) and high waist to hip ratio. Coupled with this glaring finding is the raised blood sugar and abnormal serum lipid values. This trend is evidently seen in Southeast Asian countries due to globalization and urbanization. If we will not act urgently about this phenomenon through strong government policy recommendations , the Noncommunicable diseases will further hurt the disadvantaged sector specifically the young and poor segment of the population.

NCDs are not exclusive to the affluent elderly patients now but they are seen across all social classes and more dominantly in the young and poor population. This results from unhealthy dietary patterns such as high calorie intake from total fats ( indigenous oils and coconut oil ) , high consumption of sugars and sweetened beverages and low consumption of the more expensive fruits and vegetables. In 1977, Prof Gerald Reaven of Stanford University theorized that obesity was the trigger risk factor in the development of a medical condition known as Syndrome X composed of the ff : obesity, hypertension , diabetes mellitus , hypertriglyceridemia and low HDL. It has undergone massive research work and has evolved into the so- called Metabolic Syndrome leading into NCDs , killing millions every year.

According to Prof Antonio Dans et al , Lancet Article Feb 2011 , abdominal obesity might be more important in people of Southeast Asian countries than from the rest of the world. In the INTERHEART study, waist to hip ratio was a better predictor of coronary artery disease than was BMI. This finding was especially true in Southeast Asian people , in whom a high waist to hip ratio increased in the likelihood of. CAD almost four times compared with a two fold rise in the world population.

Though the prevalence of obesity is increasing in the Asian region, there is paradoxical persistence of under nutrition. This double burden of malnutrition ( undernutrition and over nutrition ) presents a great and difficult public health challenge for a poor country like the Philippines because catch up weight gain after perinatal and postnatal restriction has been postulated to increase risk of diabetes and cardiovascular complications (Stein , 2005).

Recently, Internet addiction , in which the individuals spend an excessive amount of the time online , is recognized by some experts as an evolving medical condition . In the era of the internet, Twitter, and Facebook , obesity will continue to rise due to the lack of physical activity with increase of unhealthy eating patterns - high intake of French fries , burgers, pizza, sweetened beverages , junk foods, and low intake of expensive fruits and vegetables. On another concern , smoking with obesity is a deadly combination - tobacco use among children aged 13-15 years was very common in the Philippines (28 % in boys and 17 % in girls ). (WHO,2009).

One disturbing fact now based on the preponderance of data is the finding that deaths from NCDs in the region are highest in countries that are economically poor. If this inequality or inequity is to be corrected , healthcare delivery has to be structured in a manner that maximizes use of meager resources and strikes a careful balance between speedy public health interventions and medical services. Public and preventive health programs have a unique advantage in that they do not involve massive investments in costly equipment and drugs.

Here are some pioneering recommendations that we need to do differently given our limited resources and the " silent " NCD epidemic that the young and the poor are facing :

1. Transformative education of teachers and all students from the primary and secondary education to the collegiate levels on preventive health education focused on healthy diet options and increase in physical activity with tobacco cessation as top priorities.

2.Local Government Unit heads will have to pass ordinances quickly to curb tobacco use , issue dietary guidelines and food labels , and build infrastructures like provision of pedestrian pathways so people can do physical activities.

3.Workplaces in private and public organizations should build a healthy environment eg smoke free policies,healthy diet options , and facilities for physical activity.

4. The Food Drug Administration with the help of technical experts from the private sector has to regulate the nutritional industry through implementation of Food Label and calorie counter to restrict the use of high calorie foods ,trans fatty acids , sugars, and salts.

5. Civil society , including coalitions of affected individuals and their families , medical organizations, and the media champions should play a major part in holding our leaders accountable for delivering on their commitments on Noncommunicable Diseases.

The time is now to act to protect the young and the poor affected massively by NCDs.
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See also:
Lifestyle Diseases 1: Obesity, February 04, 2011
Lifestyle Diseases 2: Killer diseases in the Philippines, March 16, 2011
Lifestyle Diseases 3: Causes of Mortality in the Philippines, August 10, 2011
Lifestyle Diseases 4: The UN on NCDs, September 24, 2011
Lifestyle Diseases 5: NCDs Global Picture, September 30, 2011

Monday, January 16, 2012

Pilipinas Forum 24: Minimal Government Manifesto

I posted the Manifesto in PF yahoogroups in late March 2004, it attracted several comments until mid-April 2004 from friends and supporters. Here are the major comments. As usual with other PF series, get your fave drinks and snacks, this is 14 pages long.

The Minimal Government Manifesto

Minimal Government = Minimal Bureaucracy = Minimal Taxes.

Smaller government appropriation from our hard-earned income = Greater individual freedom where to spend or save their hard-earned money.

Smaller government restrictions in movement of goods, services and people = Greater individual freedom where they will work, invest, trade, travel, rest and retire.
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In the beginning of human civilization, at primitive hunting societies, men learned to trade with each other. The animal hunters traded their excess animal catch with fish hunters for the latter's excess fish catch. Or traded with craftsmen for the latter's carpentry, musical instruments and other artistic services. Or traded with early farmers who practiced the early technologies of agriculture. Thus, men invented the MARKET for the exchange of goods and services, and it went well. There was no government then made up by full-time administrators and enforcers of mutually-agreed rules.

Later as population and economic activities expanded, market failures arose - monopolies, oligopolies, externalities associated with production like pollution, dealing with criminals and other deviants that disrupt social order and threaten property rights, dealing with external aggressors, etc. So men invented GOVERNMENT. And government invented TAXES and various fees. Initially it went well.

Later, governments introduced government failures and inefficiencies - bureaucratic red tapes, corruption, excessive tax rates, excessive trade barriers, state-sponsored monopolies, etc. So men invented non-profit organizations, more commonly referred to as non-government organizations (NGOs) and civil society organizations (CSOs). Initially it went well in attempting to reform government and state failures.

Later, it became evident that "reforming government" has become an oxymoron. Bureaucracies, once created, seldom decline, let alone die. In fact, governments later invented habitual BUDGET DEFICIT Many politicians run for government positions not to reform government but to maintain, if not worsen, those state failures.

Some groups went extreme and invented communist parties and socialist parties, to make an already super-imposing state become a "Big Brother" interventionist socialist state, supposedly to "centrally plan" the basic needs of its people. Later, many socialist states could not even plan and produce how many tons of bread and rice, how many million liters of gasoline, how many pairs of jeans and shoes, will be needed by their people. Scarcity led to political instability which later led to collapse of many socialist governments, from the Soviet Union to Eastern Europe. The remaining socialist states (China, Vietnam, Cambodia, etc.) survive because they have allowed the market system to exist in the economic sphere while maintaining political monopoly.

Why reform government when markets can do the delivery of some public goods and services more efficiently?

Why reform government when some government functions can be privatized?

Why keep high and complicated taxes when many citizens are privately paying for services that should have been done by government, but failed to deliver because of government failures?

Why let government bureaucrats and politicians decide how much they should appropriate from our hard-earned income and wages, and where they should spend our hard-earned money, including how much to pay for themselves, their travels and their parties?

Population Control 8: People and Economic Growth

This is my article yesterday in the online magazine,

http://www.thelobbyist.biz/perspectives/less-gorvernment/1261--more-population-more-economic-growth

More Population, More Economic Growth

SUNDAY, 15 JANUARY 2012 02:21

WRITTEN BY NONOY OPLAS

Tags: Less Government

More population means more workers, more entrepreneurs, formal or informal. And an economy or a country will have faster growth on average. Some people though will take a more pessimistic view and argue that more population means more poverty, more resources to be diverted from hard infrastructure to soft infrastructure like public education, healthcare and housing.

I will say that the former view is more realistic than the latter. And the latter is held mainly by people who think that the poor are mainly welfare-seeking and dependence-minded people who can hardly be expected to become high productivity workers someday.

Meanwhile, CNN’s business blog posted this article by Kevin Voigt, World’s top economies in 2050 will be... And here is their observation and list:

By 2050, the Philippines will leapfrog 27 places to become the world’s 16th largest economy.

Notice the countries which are projected to leap frog several notches higher: they are mostly the high population countries: China +2, India +5, Brazil +2, Mexico +5, Turkey +6, Philippines +27, Indonesia +4, Egypt +15.

Some big population countries are expected to slide down in global rank, but only in very small increment: US -1, Japan -2, and Germany -1.

As argued above, more population means more workers, more entrepreneurs. But somehow sadly, more population would also mean more bureaucrats too, especially in LGUs, people who say that any form of entrepreneurship and job creation is prohibited and a criminal act, unless people will first get endless business permits from the barangay to sanitation to electrical to mayor's permit.

The people from the slowly-sliding economies of Europe should also be happy that there are high population countries like the Philippines and India. Soon, millions of old people will be taken cared of not by robots, not by government and UN personnel, but by the "surplus people" due to "unwanted pregnancies" of high population countries like the Philippines.

I heard of some Filipinos who lived for several years in the US then went back. They miss having helpers, nannies, drivers, etc. Here they can work late or party late at night without worrying who will feed the kids their dinner at home, wash them up and bring them to bed. Some guys they hired who could be products of "unwanted pregnancies" do those jobs for them. This should also be one of the reasons why many expats love staying here.

If one will visit the parks of expensive villages like Bel Air, Dasmarinas Village, or Forbes Park, one will see lots of white kids, or kids from North Asian parents (Japanese, Koreans, etc.) -- with nannies and drivers, some even with bodyguards -- while parents work or travel. The dogs also have their own yayas or yayos when they walk around the villages. The expats can't have such helpers in the US or Europe, unless they are super-rich.

These things allow many middle class and rich people, locals or expats, to increase their productivity, they can work 10 hours or more each day without worrying much about the kids at home or at school.

Some couples do not have kids, or some people stay single and do not get married, and do not have kids either as "single parent/s". If many people have this fate, then Philippine population will soon decline.

Some people opted to become single parents with one or two kids only. Others who have few kids would sadly lose them in accidents, in man-made catastrophe (crimes, kidnapping), or in some deadly diseases (dengue, etc.). If many people have this fate, then future Philippine population will just stabilize from its present size, if not slowly decline.

So it is really the people who have plenty of children (five or more), rich and poor alike, wanted or unwanted pregnancies alike, who push Philippine population upwards. Nannies, family drivers, helpers, cooks, security guards, taxi drivers, etc. often come from poorer households who have plenty of children. So the rich and middle class, including those who push hard for government-sponsored population control, must thank the poor for giving them those workers and helpers. Without the latter, we will be like many Japanese and Europeans who think that having kid/s can cause net diswelfare in their personal, social and professional lives.

People who have less worries about raising children, or less worries about who will take care of their ageing and/or sickly parents, grandparents and other family members, thanks to the nannies, helpers and drivers to help run the household, would be able to concentrate more on their work and businesses, and their productivity keeps rising, and so we have more economic growth than many other countries.

So more "unwanted pregnancies" can be a blessing and a positive thing, not negative. Instead of looking at the poor as people who will need endless subsidies from the government, the latter should instead allow the poor to improve their own lives, to become self-reliant and independent from state welfare, by not giving them lots of bureaucracies, by not requiring them to submit lots of permits and certificates, and not requiring them to pay lots of taxes and fees each year, when they put up entrepreneurial activities.

Sunday, January 15, 2012

Weekend Fun 26: Jokes in PH Elections

I dug these jokes in my email inbox, during the 2007 and 2010 elections:

1. Team Unity, Team Arroyo (TUTA) vs. Grand Alliance of Genuine Opposition (GAGO).
Iboto mga TUTA at GAGO sa Senado!

2. Girl: Lahat ng mga politiko, magnanakaw!
Man: Ang sakit mo naman magsalita!
Girl: bakit, politiko ka ba?
Man: Hindi, magnanakaw!

3. Q: Ano difference ng snatcher sa politiko?
A: ang snatcher, magnanakaw muna tapos tatakbo;
ang politiko, tatakbo muna tapos magnanakaw.

After the 2010 elections:

4. Reporter to Erap: Kayo na lang po ang di pa nagco-concede. Bakit po ayaw nyong mag concede kay Noynoy?
Erap: Ba't ako magcoconcede? E, nong bomoto ako, sabi ng PCOS machine, "Congratulations!"

5. Erap: "I refuse to conceive."

6. Erap: I will not conceive. Muli kong pinatunayan na hindi pa ako natatalo sa anumang elections. Even if I place second to Sen. Bong, balik naman ako sa Senate.

7. Erap: Where is Jinggoy? Pag nakita nyo, tell him that I will advise him to be a gentleman and to conceive na. He can again run for President sa 2016. Bata pa naman sya.

8. Erap writing in a slum book...

Favorite actor: ARNOLD SCHWARZ... (erase)

ARNOLD SHWARSEN... (erase)

SWHARZIN... (erase)

ZWARZEN... (erase)

ARNOLD CLAVIO!

9. Dati, ang tawag sa taong walang-hiya -- MAKAPAL; or KUPAL
Tapos mas matapang ang term -- GARAPAL
Ngayon iba na ang tawag -- MACAPAGAL

10. Today, wear BLUE if you are for GMA.
wear RED if you're for Erap.
wear YELLOW if you're for Cory.
wear WHITE if you're for Ramos.
wear PINK if you're for RUSTOM, TRUTH AND FREEDOM!

(Picture: Congressional Insertion)
11. BAYAAN MO NA Party list will produce a reality show. GMA, VP Noli, 20 senators and 200 congressmen ay ikukulong sa Batasan for 100 days: no visitors, no cellphones, no media.
ang magiging title ng palabas ay PINOY BIG PROBLEM!
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One more political joke:

A dying Maoist NPA fighter seriously wounded in a battle with the soldiers, he wanted to see and kiss a picture of Mao Tse Tung and Vladimir Lenin before he dies. No pictures of both men as their hideout were in a mess after the military attack. But they had one female comrade, so Maoist and Leninist that she had the pictures of both guys tatooed in her 2 legs!

The colleagues were able to persuade the amazon to show her thighs to her dying comrade, allowed him to kiss both tatoos... suddenly the lady shouted, "Ekkkhh! Karl Marx not included!"
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* Light jokes:

1. Q: Ano ang nauna, tsinelas o slippers?
A: eh di slippers. Bakit?
kasi sliFIRST, tapos, tsineLAST.

2. Differences among STRESS, TENSION, PANIC, and FREAK-OUT?
A: Stress -- if the wife is pregnant.
Tension -- if the gf is pregnant.
Panic -- if both are pregnant!
Freak out -- if the 2 plus the maid are pregnant!!!

3. Wife: maghiwalay na tayo!
Husband: Sige, hiwalay tayo! sa akin ang farm!
W: sa akin ang bahay!
H: sa akin ang kotse!
W: sa akin ang driver! mtagal na kami!
H: pwes, magpatayan na tayo, dahil akin syaaaa!!!

4. Lola: Pulis, ikulong nyo mr. ko, lagi nya akong dino-dog style!
Pulis: Lola, wala namang illegal dyan.
Lola: Sige, ikaw nga singhot-singhotan, tapos iihian ng nakataas ang isang paa!

5. 2 senior citizens at the church:
Husband: Hon, nakakahiya... napautot ako pero walang ingay. Naamoy mo ba?
Wife: Hindi, pero dapat palitan mo na baterya ng hearing aid mo!

6. Learn English:
nagbebenta ng isda -- SELFISH
palayain ang pusa -- PREDICATE
lahat sa kanan -- ALRIGHT
babaeng sa ilalaim nakatayo -- MISUNDERSTANDING
matagal nang bulag -- LONG TIME NO SEE

7. Nanay: anak, ano itong zero sa test paper mo?
Anak: nay, di po yan zero. naubusan kasi ng star teacher ko, kaya binigyan nya
ako ng moon.

8. Priest: Hinabol ako ng magandang babaeng hubad. Ginawa ko, dinamitan ko
agad! Kayo Bishop, ano gagawin nyo?
Bishop: Tulad mo, magsisinungaling din ako!

9. Beggar: boss, palimos po.
Boss: Iinom ka o magsusugal?
beggar: wala po akong bisyo.
Boss: sige, sama ka sa akin sa bahay para malaman ng nanay at mrs. ko ang nangyayari sa taong walang bisyo!

10. Kumatok ang 1 ahente. Pagbukas ni mrs. ng pinto, agad pumasok ang ahente at ikinalat sa sahig ang ebak ng kabayo.
Ahente: Ma'm, pag hindi nalinis ng Vacuum cleaner ko sa sahig ang ebak ng kabayo, kakainin ko ang mga yan.
Mrs. ay teribleng bata! umpisahan mo na pagkain nyan at BROWN-OUT kami ngayon!

11. Headline bukas, ngayon ang broadcast:
* Tahanang walang hagdan -- inakyat!
* Bakla, sumali sa away -- napasubo!
* Bagong tuli, nagyabang -- lumaki ang ulo!
* Unanong madre, napagkamalang penguin!
* Bulag nakapatay, nagdilim daw ang paningin!
* Teacher nagkamali, tinuruan ng leksyon!
* Tindera ng suka -- tinoyo!
* Basurero nagsampa ng kaso -- binasura!
* Tubero -- nagkatulo!
* Mrs. ng photographer -- nakunan!

12. Pagdating sa kainan, ILONGO and weird.
Pag sila alok kain, sasabihin, "Kaon ta anay"
pag pinilit ka kumain, "Kaon ta bala"
pag pumayag ka kumain, "cge, kaon ta e"
pag pakainin ka ulit, "kaon kagid ha"

13. Ang tunay na kagandahan ay di nakikita sa pisikal na anyo ng isang tao kundi sa puso.
Yan! Yan...
Yan ang motto ng mga pangit!
Buti na lang ang sa atin eh, Handsomeness is contagious!

14. Anak: tay, may kamag-anak ba tayong mahirap?
Tatay: Meron, pero di ko kilala.
Anak: eh mayaman?
Tatay: Meron, pero di tayo kilala.

15. Money is relative.
More money, more relatives.

16. A Filipino went to the US, his American host showed all his gadgets commanded by remote control. After his return to PH, the American friend also came. Coming home from the airport, he honked his car horn and the gate was opened by his houseboy. Inside, he clapped his hands and shouted coffee. The maid then brought in barako. The American was impressed. The Pinoy said, "You have remote control, I have voice control."

17. American boy: You know the Pacific Ocean? Our great great grandfathers dug it.
Jordan boy: You know the Dead Sea? Our great great grandfathers killed it.

18. American boy: in America, we have dog clinic, dog hospital, dog cemetery.
Pinoy boy: do you have dog restaurant?
Am boy: No, because we love dogs.
Pinoy boy: We eat dog.
Am boy: but we eat hotdog.
Pinoy boy: No, we do not eat that part.
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See also:
Weekend fun 10: Gadhafi fashion, February 19, 2011
Weekend fun 11: More Gadhafi fashion, February 25, 2011
Weekend fun 12: Marcos corruption, February 25, 2011
Weekend fun 13: Economics of stimulus package, March 05, 2011
Weekend fun 14: Ghadafi's women bodyguards, March 05, 2011
Weekend fun 15: Political jokes, March 12, 2011
Weekend fun 16: Gaddafi cartoons, March 19, 2011
Weekend fun 17: Political jokes, May 15, 2011
Weekend fun 18. Gloria Arroyo cartoons, June 11, 2011
Weekend fun 19: Sic o Clock News, June 19, 2011
Weekend fun 20: Taga-UP Diliman ka Kung..., August 20, 2011
Weekend fun 21: Humor in global financial turmoil, August 21, 2011
Weekend fun 22: Functions and equations, September 17, 2011
Weekend fun 23: Economists joke, September 24, 2011
Weekend Fun 24: Water and the Professionals, December 17, 2011
Weekend Fun 25: "I Will Survive" by Gloria Arroyo, January 08, 2012

Friday, January 13, 2012

Drug Price Control 23: Greece's Pharmacy Nightmares

Governments' heavy intervention in the pricing of privately-produced goods and services like medicines often create more problems than solutions, more troubles to patients than treatment. This is because companies, enterprises and individuals have different product characteristics, quality, cost of R&D (if any) and production, and pricing. When government steps in, it thinks a one-size-fits-all policy will apply to all players.
I have discussed these issues in the past in this blog.

Here is the case of Greece, from http://www.bloomberg.com/news/2012-01-10/greek-crisis-has-pharmacists-pleading-for-aspirin-as-drug-supply-dries-up.html.

The report said,

The reasons for the shortages are complex. One major cause is the Greek government, which sets prices for medicines. As part of an effort to cut its own costs, Greece has mandated lower drug prices in the past year. That has fed a secondary market, drug manufacturers contend, as wholesalers sell their shipments outside the country at higher prices than they can get within Greece.

Strained government finances only make matters worse. Wholesalers and pharmacists say the system suffers from a lack of liquidity, as public insurers delay payments to pharmacies, which in turn can’t pay suppliers on time....

Austerity measures imposed to address the financial crisis may paradoxically be making matters worse. Greek wholesalers now have more incentive than ever to sell drugs outside the country after Greece implemented a law last year further reducing prices. The law sets prices of medicines according to the average of the three lowest charges in 22 European Union countries, part of an effort to trim a health bill that in 2010 totaled more than 13 billion euros, or about 5 percent of GDP.

Parallel Trading

Parallel imports peaked in 2004, then flattened out about two years ago once drugmakers imposed quotas of the maximum amount of medicines they think the Greek market will need, said Kobelt, whose Brussels-based association represents companies engaged in the trade. Still, if pharmacies can’t pay, it makes economic sense to ship the drugs back out again rather than let them languish on wholesalers’ shelves, he said.

Kobelt said he’s seen boxes of Bayer AG (BAYN)’s Aspirin in Poland that originated in Greece, suggesting that the medicine fetches higher prices in eastern Europe.

“Even Polish people pay more than Greeks for Aspirin,” he said. “That is the recipe for parallel trade, I’m sorry to say.”

Novo Nordisk A/S (NOVOB), based in Bagsvaerd, Denmark, is a case in point.

“We are competing with our own products,” said Mike Rulis, a spokesman for the company.

Novo stopped selling some of its higher-priced insulins in Greece for about a month in 2010 after the government cut prices by about 25 percent. The drugmaker now ships in the same volume as before the cuts, yet pharmacists are running short of insulin, Rulis said in a telephone interview....

There you go. Another case of "cheap but not available" products. If a company will earn more by exporting their products abroad than selling them domestically, they will do so. Some people and quarters will object to this practice, so they will propose another round of government intervention after price control: export control. This will create two new problems. First is more government corruption. The implementors of export control are just people, they can be bribed if the price is right. Second is outright closure of a company, even temporarily, since there is no use operating at a loss.

The problem of "cheap but not available" is also happening in many rural drugstores in the Philippines and elsewhere. Some private drugstores buy on those cheap drugs sold by government-sponsored Botika ng Bayan or Botika ng Barangay, when the latter run out of supply, the private pharmacies, or often just miscellaneous shops or "sari-sari stores", sell those drugs at a higher price.

There is a difference in the drug price control policy design between the Philippines and Greece. In the former, only 21 drug molecules, among the most popular prescription medicines in the country, covering several dozen preparations were affected. In Greece, it's implied in the news report above that many if not all drugs were covered. Different designs but the same wrong policy that produce the same wrong results.

Price control is slapping penalty for successful and more effective drugs. When government penalizes formal and officially registered businesses, informal and unscrupolous businesses come in, with a distorted social result.
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Meanwhile, here is an index of my papers on this subject last year:

Drug price control 1: IPR and taxes on medicines, January 14, 2011
Drug price control 2: Competition and GSK experience, January 25, 2011
Drug price control 3: Cost containment and long-term costs, January 27, 2011
Drug price control 4: Blog popularity in google, yahoo and bing, February 14, 2011
Drug price control 5: Mandatory discounts and acronym politics, March 21, 2011
Drug price control 6: Exploring just one price for each drug, May 25, 2011
Drug price control 7: Pricing by drug inventors, May 30, 2011
Drug price control 8: Advertising and Govt pharma corporation, June 01, 2011
Drug price control 9: More comments on single pricing per drug, June 02, 2011
Drug price control 10: Blog posts on page 1 of Bing, Google and Yahoo, June 09, 2011
Drug price control 11: Costs, ads and taxes, June 25, 2011
Drug price control 12: Blog posts on page 1 of Google, Yahoo and Bing, August 14, 2011
Drug price control 13: Two years of price control policy, August 15, 2011
Drug price control 14: Another book review, Health Choices and Responsibilities, August 22, 2011
Drug price control 15: Price regulations board, August 24, 2011
Drug price control 16: More on Cong. Biron's Bill, September 01, 2011
Drug price control 17: Wikileaks on the planned Pfizer drugs withrawal, September 22, 2011
Drug price control 18: Wikileaks and former US Amb. Kenney on price control, September 28, 2011
Drug Price Control 19: Why is the Policy not Withrawn Yet, November 08, 2011
Drug Price Control 20: Competition, not Price Regulation, November 10, 2011
Drug Price Control 21: Illegalities in the Implementation of the Policy, November 14, 2011
Drug Price Control 22: Comparing Prices of Drugs, Diagnostic Tests, PFs, December 24, 2011

Tuesday, January 10, 2012

IPR and Medicines 20: Scherer Paper on Pharmaceuticals R&D

The discovery and invention of new medicines and vaccines against various diseases remains a high-risk, high cost activity for the pharma and biotech companies involved in the process. This probably explains why there are more companies engaged in information and communications technology (ICT), in hotels and food chains, in airlines and forwarding, in telecomm and power, than in medicine development. For one, the latter is heavily regulated by all governments in all countries. The only pharma companies that don't get heavy regulations perhaps are the manufacturers of fake and counterfeit or substandard drugs because they operate underground and escape the heavy hands of various government health regulators.

A physician friend sent me this morning a new paper, R&D Costs and Productivity in Biopharmaceuticals (see more papers at www.hks.harvard.edu). The paper is not really complicated, it only wanted to find out, among others, to what extent the costs in pharma R&D have increased so far, the increasing procedures required to get regulatory approval, and so on. But it is significant because it's a very recent paper, produced only last month, from the famous Harvard Kennedy School.

An alternative and more authoritative source to get info about R&D costs of pharma and biotech companies will be that of the Pharmaceutical and Research Manufacturers of America (PhRMA), infographics section, http://www.phrma.org/research/infographics.

Dr. Scherer showed this figure at the start of his paper. The number of newly-approved drug molecules have increased greatly in the 90s, tapered in 2000s, but the cost of R&D spending has consistently rose in an almost linear path. Thus, sometime in 2009 for instance, the number of newly approved drug molecules and biologicals were around 30 and R&D spending was about $30 billion. Compare that in the late 90s where some 60+ newly developed molecules were approved but R&D spending was only around $15 billion.

The author compared independent research of cost estimations from other sources. He wrote,

... cost per successful new molecule. There have been numerous quantitative investigations. The leading efforts, and those most highly cited in both the scientific and popular literature, have come from collaborating economists at Tufts University, the University of Rochester, and Duke University...

For the most recent of the comprehensive Tufts University studies, the estimated average out-of-pocket cost per successfully approved molecule, including the pro-rated costs of failed tests, all measured in year 2000 purchasing power levels, were as follows:
   Pre-clinical $121 million
   Clinical testing $282 million
   Total cost per approved drug $403 million

The mean clinical testing estimates, which are undoubtedly more reliable than pre-clinical estimates, can be compared with the analogous costs from three earlier studies summarized by Scherer (2010, p. 154), each adjusted to year 2000 purchasing power levels:

Source Test Period Average out-of-pocket cost per approved new drug

Mansfield Late 1950s $ 5.4 million

Clymer Late 1960s 40.2 million

Tufts I 1970-early 1980s 65.7 million

Tufts II 1983-late 1990s $282 million

That's a rising trend indeed in R&D cost. The main cause of such explosion in costing would be the rising tests and procedures required by the regulatory agency, the US FDA, before they will approve any new drug molecule.

Another figure shown by Dr. Scherer, Phase 3 of clinical trials is the most costly, eating up to $40 million for each new drug. He wrote, On average, only one-fifth to one-fourth of the small-molecule drugs entering Phase I testing emerge roughly eight years later with marketing approval. For biological therapies developed during the 1990s, the survival probabilities appear to be higher -- e.g., roughly 0.3 from a survey by DiMasi and Grabowski (2007) and even higher for the earliest approved biologicals, which mainly emulated naturally occuring substances.

Given the complexity and high risks, high costs involved in developing new medicines and vaccines, it is indeed unfair that successful drugs will be slapped with certain government interventions that effectively penalize, instead of rewarding, new medicines innovation. The author did not mention in his paper anything about such threats in intellectual property rights (IPR) of medicine discovery, but readers and observers who are keen on slapping patent-abrogation government policies like compulsory licensing (CL) and related measures, or be imposition of medicine price cap and control, are not likely to believe the high risks and costs involved in drug discovery. They only see the angle of "patented drugs = expensive drugs". Thus, to bring the prices of those more powerful and new drugs, patent life should be kept as low as possible.

This attitude is not healthy not only for the research and pharma companies, but more so for the patients today and tomorrow. We have read and seen cases of ever-evolving and mutating diseases. Such disease mutation are not likely to be effectively treated by old and existing medicines and vaccines, but by new and more modern ones. And it is also very likely that FDAs will be imposing new and more stringent rules and procedures before they approve new medicines and vaccines. In a situation of rising requirements and regulations, costs will also be rising and hence, prices of new drugs and treatment will be rising. Governments should in fact reduce costs-inflating policies like taxes on medicines as they raise the regulations to make future drugs more safe and more effective in killing diseases.
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See also:
IPR and medicines, Part 1, March 04, 2011
IPR and medicines, Part 2,
IPR and medicines, Part 3,
IPR and medicines, Part 4,
IPR and medicines, Part 5, March 14, 2011
IPR and medicines, Part 6, March 15, 2011
IPR and medicines, Part 7
IPR and medicines, Part 8, March 31, 2011
IPR and medicines, Part 9, June 08, 2011
IPR and medicines, Part 10, July 13, 2011
IPR and medicines 11: When blockbusters' patent expires, September 07, 2011
IPR and medicines 12: Expanding generics, September 09, 2011
IPR and medicines 13: Improving Generics Quality, September 13, 2011
IPR and Medicines 14: Compulsory Licensing in developing countries, October 04, 2011
IPR and Medicines 15: New Vaccines and Public Health, November 05, 2011
IPR and Medicines 16: Wikileaks and the Cheaper Medicines Law, November 08, 2011
IPR and Medicines 17: Why are Drugs Still Expensive After Patents have Expired?, November 17, 2011
IPR and Medicines 18: Generic Drugs and the Consumers, November 18, 2011
IPR and Medicines 19: Miracle Anti-Cancer Drug?, January 04, 2011

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