This Week:

Quote of the Week

Generic Capitalism, or High Drug Prices Explained (Again)

Adjectives U Can Use

Greetings,

In Nygaard Notes 220 and 221 I talked about the pharmaceutical industry. There was some breaking news on the subject that I couldn’t fit in at the time, so I include it this week in the piece “Generic Capitalism.” Such evidence of the shameful collusion between the drug industry and the White House should be a major scandal, in my opinion, but few people seem to have noticed. Judge for yourself.

As you know, this issue of the Notes was scheduled to come out last week, but was delayed due to my taking longer than I expected to recuperate from my heart operation. I’m still not 100 percent, but am pretty much back to work, and already have a backlog of pieces written that you may or may not see as the coming weeks unfold, depending on what events dictate.

Thank you to the many, many readers who wrote to me, including the ones who gently chastised me for not taking enough time to fully heal. I needed that.

Until next week,

Nygaard

"Quote" of the Week:

In the New York Times (“All The News That’s Fit To Print”) of August 25, 2003, on page A6, was an article headlined “Senators Say Iraq Needs More U.S. Troops and Money.” In that article, we learn that Senator Lindsey Graham, a Republican from South Carolina, had accompanied John McCain on a recent trip to Baghdad, and said that while he considered the troop level in Iraq to be sufficient, billions of dollars of additional spending is required there and in Afghanistan. Then the Times quoted something that Mr. Graham said on the “Fox News Sunday” show of August 24th:

“I am a fiscal conservative, and we're in debt. But the infrastructure needs in Afghanistan and Iraq are billions. We are underestimating the cost of this conflict, and we in the House and the Senate
need to appropriate a lot more money.”

To get the full impact of this quotation, simply take the phrase “this conflict” from the last sentence, and substitute “providing health care for all United Statesians,” or “educating our children,” or “providing a decent retirement for our seniors,” or whatever pressing social need you care about. (Collect them all, kids!) Then try to imagine Mr. Graham – or perhaps your own U.S. Senator – saying that “we need to appropriate a lot more money” for something other than the military occupation of another country.

Generic Capitalism, or High Drug Prices Explained (Again)

In late August U.S. news “consumers” saw a series of headlines like “Poor Nations Can Purchase Cheap Drugs Under Accord” and “WTO Votes To Bypass Patents on Medicines; Cheap Generics Go To Poor Nations.” What the Media were talking about was what they called a “deal” being struck in the World Trade Organization (WTO) “to allow poor countries to import cheap copies of patented drugs to treat killer diseases such as AIDS, malaria and tuberculosis.” (That’s how the Washington Post put it on August 31.)

The patents on lifesaving drugs to which the stories referred, no matter where in the world they are found or needed, are almost all held by companies in the U.S., the European Union, and (non-EU-member) Switzerland. The result is that untold numbers of people—and not just in the Third World—are unable to afford prescription drugs. This is a crime, although no one has gone to jail for it. Instead, they have generally received tax cuts.

As usual with international news, the “spin” on this story was quite different in the U.S. press than it was in the press of other countries. For example, the London Financial Times, in reporting on the drug agreement, said, “In the run-up to the WTO ministerial meeting at Cancun next month, the tiniest of agreements are surrounded by hype. This largely symbolic deal fits that pattern.” In the U.S., in contrast, you see newspapers like the Wall Street Journal calling it a “landmark agreement,” and finding a diplomat to say that “We’re on the verge of closing a very significant file.” (I don’t know why he said “file.”) What actually happened here? “Hype?” Or “landmark?”

As I pointed out a couple of weeks ago, drug patents bring enormous profits to the corporations that hold them. The profits come from the patent-holders’ ability to artificially inflate the prices of the drugs on which they have the patents. This is nowhere more clear than in the case of the anti-retroviral (ARV) drugs used to treat people with HIV/AIDS. A common three-drug “cocktail” used in treating HIV/AIDS, for example, costs between $10,000 and $15,000 per year when the patented version is purchased from the originator company. A generic version of the same cocktail, made in India, has been offered for sale at $350.00. (Yes, three HUNDRED and fifty dollars.) That’s a markup of between 2,850 percent and 4,300 percent. The price differentials on other drugs are often less extreme, but still appalling.

Finding the Real Headlines

The various reports on this subject in the Mainstream Corporate For-Profit Agenda-Setting Bound Media (see last week’s Nygaard Notes for an explanation of that ungainly term) freely reported some very revealing facts about our political leadership, facts that could and should have been the headline story. Here are three examples:

The Wall Street Journal, August 28: “Progress on providing access to low-cost medicines has been stalled since December, when the U.S., alone among the WTO's membership of 144 nations at the time, held out. The U.S., pressured by a powerful pharmaceuticals lobby, said it was worried about relaxing patent rules. In addition to hurting drug companies, Washington was worried that new WTO rules might also be applied to other prized technologies such as software.” (Paragraph 9)

The Washington Post, August 31: “American drug makers including Pfizer Inc. and Merck & Co. were concerned any loosening of patent rules may have been interpreted to allow nations such as Brazil to override patents on medicines for noninfectious diseases, such as asthma or cancer, and flood European and U.S. markets with cheap generics.” (Paragraph 15)

New York Newsday, August 31: “The deal aims to reassure the United States—home to many major drug firms—that such waivers will not be broadened to let generic drug makers in the Third World export such cheap medicines to rich countries. That would cut into the profits of big drug firms...” (This comment appeared in a short, 5-paragraph article on page 16)

The U.S. intransigence back in December was obscured in U.S. news reports by the use of such non-finger-pointing headlines as “Talks on Low-Cost Drug for Poor Nations Stall” (Post) and “Trade Talks Fail to Agree On Drugs for Poor Nations” (Times)

The real story was expressed by Ellen ‘t Hoen of the international aid and advocacy group Doctors Without Borders, who said “Today's deal was designed to offer comfort to the U.S. and the Western pharmaceutical industry. Unfortunately it offers little comfort for poor patients.”

“Commercial Policy Objectives”

The Post article adds that “The statement [agreed to by the U.S.] says rules allowing countries to override patents ‘should be used in good faith to protect public health . . . not be an instrument to pursue industrial or commercial policy objectives.’” That’s a truly remarkable statement, if you think about it. The “commercial objective” that countries are forbidden to pursue in this agreement, in other words, is the right to sell generic pharmaceuticals at fair market prices to consumers (i.e. “people”) in wealthy countries who may be struggling with diseases “such as asthma or cancer.”

To spell it out even further, what these articles are reporting—without really saying it plainly—is that the Bush administration is working very hard in the international arena to impede what they like to call “Free Trade.”

Going a bit afield from the Mainstream Corporate For-Profit Agenda-Setting Bound Media, we can find all sorts of analysts who “get it,” and have taken the time to point out the massive contradiction between the Bush administration’s rhetoric and their actual behavior. Doctors Without Borders, for instance, states in a recent report that “The experience with antiretrovirals (ARV) and other drugs has amply shown that as competition rises, prices fall.” That’s just what “Free Market” theory predicts, and just what various U.S. administrations have resisted.

Economist Dean Baker also tells it like it is in this context: “Patent protection constitutes an enormous interference with the free market, raising the price of drugs by several hundred percent above the competitive price. In addition, since the vast majority of patents are held by rich nations, enforcing patent protection will result in a transfer of wealth from poor nations to rich nations. According to World Bank models, the economic losses to developing countries from imposing patent protection will exceed the gains they would receive if rich nations were to remove all remaining trade barriers.” (Economics Reporting Review, September 2, 2003)

This last point is important for those who followed the recent meeting of the World Trade Organization in Cancun, Mexico. The reporting on that meeting could easily give one the impression that the existence of agricultural trade barriers is the most important trade issue for poor countries. Maybe it is. Maybe not.

Hmmm. Seems like it’s time for another Nygaard Notes Alternative Headline. Here’s one: “Bush Administration Promotes Corporate Profits Over Public Health.” Or perhaps, “Bush Policies Keep Prescription Drug Prices Out of Reach of U.S. Citizens.”

As always, I feel compelled to point out that, as bad as the policies of the Bush administration may be in this area, it really isn’t a policy problem. It’s a structural problem that stems from the profit orientation of a capitalist health care system. And, if you think this is some sort of far-out Marxist rhetoric, consider these words from the August 29th edition of the business newspaper the London Financial Times: “With or without the enforcement of patents, drug companies have no incentive to develop medicine for those who cannot afford to pay. This deal will not change that; and the international community should be exploring new ways to pay for the development of drugs for diseases of the poor. But this is beyond the remit of the WTO.”

Adjectives U Can Use

As I emerge from my post-surgery hallucinatory state, I notice that the mental armor that usually seems to insulate me from the daily onslaught of absurdity that we call the Media is not doing its job as well as it was. Maybe that’s a good thing.

For example, consider the following words that appeared in the local paper—the Star Tribune (Newspaper of the Twin Cities!)—of September 25, in an article headlined “U.S. must Pay Cost of Foreign Troops, Rumsfeld Says”: “‘We're in trouble,’ said Sen. Ernest Hollings, D-S.C. He warned that persuading Turkey, India and Bangladesh, among other nations, to send troops to Iraq would be extremely expensive.”

Typically I would have the urge to discuss what it might mean for Mr. Hollings (he’s been elected to the Senate seven times) to point out the financial cost of something he calls “persuasion” of other sovereign nations. But this week I just decided to laugh, even though I know it’s an outrage.

On the same day, reading the New York Times (“All The News That’s Fit To Print”), I noticed a front-page story by Judith Miller and Douglas Jehl. The Times, famous for its lengthy headlines and sub-heads, labeled this article: “Draft Report Said to Cite No Success in Iraq Arms Hunt; 4-Month Search By U.S.; No Illicit Weapons Found, but Officials Describe Evidence of Suspicious Material.” (I haven’t found any botulism in my refrigerator lately, either, but I have to report that there has been some mighty suspicious material. Anyway, back to the Times...)

At one point, Miller and Jehl “report” that

“In a formal National Intelligence Estimate last October, the C.I.A. and the rest of the American intelligence community concluded that ‘Baghdad has chemical and biological weapons’... that general view was shared at the time by the United Nations and most foreign governments but support for the position has been eroded by the American failure to discover the weapons in Iraq.”

Now, really. A “conclusion” is not a “general view.” And whether a nation “has” or “does not have” something is not a “position” but is a matter of fact. Right? And, if my memory serves me correctly, neither “the United Nations” nor “most foreign governments” believed U.S. intelligence agencies when they made these unsupported claims. In fact, the failure to see any proof of these serious claims was a big part of why the Security Council of that very same United Nations refused to support the U.S. attack on Iraq, either last October or ever. Right?

Again, in normal, non-recuperative, times I would have the urge to go back and look up the evidence to support my memory of all of this. (Editor’s note on this point: Don’t quote me on the claims in the above paragraph. I did NOT look them up.) But, again, this week I simply burst out laughing when I read them. Which was somewhat embarrassing, since I was in a public place when the outburst occurred.

Do you, too, Dear Reader, sometimes find yourself at a loss as to how to describe some of the stuff you see in the newspapers? And has it gotten worse since the onset of the so-called War Against Terror (The WAT?!)? As a public service, then, here is a list of words that you can choose from the next time you run across a report in the Media about the U.S. war on whatever-it-is-we-are-supposed-to-believe-it-is-a-war-on, courtesy of my handy thesaurus: (Try reading it out loud!)

Batty! Loopy! Wacky! Kooky! Buggy! Loony! Balmy! Fruity! Berserk! Demoniac! Bonkers! Bats! Possessed! Crackers! Daft! Dotty! Haywire! Loco! Nuts!

And, of course, Evil.