Category Archives: Ethics


Presidential Candidates Agree on Drug Re-Importation – That is Not Fair

By Daniel R. Matlis

Although Senators McCain and Obama (listed in alphabetical order) are looking to address many of the same problems, they have very different approaches.

The Presidential candidates don’t agree on many things, from the economy to energy, healthcare to taxes, even Joe the Plumber.

One thing they both agree on: Drug Re-importation.

John McCain will look to bring greater competition to our drug markets through safe re-importation of drugs and faster introduction of generic drugs.

Barack Obama and Joe Biden will allow Americans to buy their medicines from other developed countries if the drugs are safe and prices are lower outside the U.S.

I thought it would be worth discussing some facts about drug re-importation:

FACT: You can buy many pharmaceutical drugs abroad for a lower price.
FACT: Some of these drugs are made by the same company at same plant, to the same standards as those sold in the US.

So why is a 30 day supply of 20mg Lipitor available for $60.78 on while offers the same product and dose for $119.99?

The answer is good American capitalism.  No, not in the way you think. Pharmaceutical Companies are not charging more in the US simply because they can.

Pharma Companies are obliged to charge less for the same product in every “G-7” (Group of 7) industrialized nation countries (Canada, France, Germany, Italy, Japan, the United Kingdom) except for the United States (see Table for examples).

Drug Pricing in Canada
In Canada, the Patent Medicine Prices Review Board establishes and enforces guidelines that determine the maximum prices at which manufacturers can sell brand name drugs. The Canadian pricing system results in brand name drug prices that are an average of 38% lower than prices in the US

Drug Pricing in France
The French pricing system allows pharmaceutical companies to sell their products at any price. However, if these companies want the national health care system to reimburse patients for the cost of the drug, the companies must agree to a lower, negotiated price. The French pricing system results in brand name drug prices that are an average of 45% lower than prices in the US

Drug Pricing in Italy
Italy’s national health care system allows manufacturers to sell their drugs at any price.
However, if these drugs are to be eligible for reimbursement under the national health care system, pharmaceutical companies must set the price of the drug at a cost that does not exceed a twelve country European average price. The Italian pricing system results in brand name drug prices that are an average of 48% lower than prices in the US.

Drug Pricing in the United Kingdom
Drug companies in the United Kingdom are free to establish their own prices for individual drugs. However, under the country’s pharmaceutical laws, the maximum profit that drug manufacturers can earn on sales in the United Kingdom is limited. The pricing system in the United Kingdom results in brand name drug prices that are an average of 31% lower than prices in the US.


The fact is that price controls in 6 of the G7 nations places an undue strain on the US consumer.

To put it in simple terms, the US (about 300 million people) subsidize R&D for the other six G7 countries (about 425 million people). That doesn’t seem fair to me.

Having been born and raised in what we now call a “Developing Economy” (we used to be known as 3rd world counties), I recognize that adjustments must be made to factor economic conditions.  However, industrialized nations should be able to equitably share in the development of life-saving therapies.

Unfortunately, drug re-importation proposals by both Presidential candidates seek to address the symptom, not the cause.

Forcing Pharmaceutical companies to artificially lower the cost of drugs in the US will have a negative impact on their ability to bring new and life-changing products to market.  And that hurts us all. 

In my opinion, we should seek to address the root cause of higher prescription drug costs in the US.  To this end, every G7 nation should equitably share in the cost of R&D for pharmaceutical drugs. That would bring prices down in the US, while supporting the development of new and innovative Pharmaceutical therapies.


Please Do The Right Thing Even When No One is Looking

By Daniel R. Matlis

On September 15 2008, FDA’s final rule on “Current Good Manufacturing Practice and Investigational New Drugs Intended for Use in Clinical Trials” will become effective.

The Rule makes “early phase 1 clinical drug development safe and efficient by enabling a phased approach to complying with current good manufacturing practice (cGMP) statutes and FDA investigational requirements.”  Additional detail is available in the FDA’s Companion Guidance Document.

Phase 1 trials are used as the initial introduction of an investigational new drug into humans. These studies are closely monitored and may be conducted in patients, but are usually conducted in healthy volunteer subjects. These studies are designed to determine the metabolic and pharmacologic actions of the drug in humans, the side effects associated with increasing doses, and, if possible, to gain early evidence on effectiveness. Phase 1 clinical trials, are often carried out in small-scale, academic environments, typically involving fewer than 80 subjects (many of them college students).

The rational for exempting most phase 1 investigational drugs from the requirements in 21 CFR § 211 (cGMP) is based on the premise that since most products do not proceed beyond the clinical trial phase of development, the burden of full compliance with cGMP at the phase 1 stage outweighs the benefits.

According to Rachel Behrman, M.D., associate commissioner for clinical programs and director of FDA’s Office of Critical Path Programs, “The new rule and guidance are intended to assure that manufacturers meet high standards for the safety of phase 1 drugs and biologics while removing unnecessary barriers that can slow the development of these potentially life-saving products.”

The FDA will continue to exercise oversight of the manufacture of these drugs under FDA’s general statutory CGMP authority and through review of investigational new drug (IND) applications.

I asked a friend, who is Director of R&D and product development at a large Pharma company in Central New Jersey, to review this article before publication. She commented that: “There may be a balance or even some good that this will do to expedite the process and invest the cost savings elsewhere, which may add value in the long run.  The entire drug development process is very costly and very unpredictable, but to your point, patient safety needs to be at the forefront.”

The fact is that bringing a new drug to market is a time consuming and expensive process. According to latest estimates it on average 12 to 15 years to bring a drug to market (See Figure)
The cost for bringing a new drug to market, that is from discovery to FDA approval, hovers around 1 Billion (yes with a B) dollars.

As we globalize and outsource development and manufacturing, it is critical to bear in mind that while mature sponsor organizations will often “do the right thing” even they are not obliged,   these expectation are not always met by operating practices at “less than mature companies or those in economies” (do Heparin and  Rambaxy ring a bell)

In the current drive to outsource, clinical manufacturing is a reasonable and viable development avenue. According to Jeffrey Meltzer, Director of Quality Management at Pharmaceutical Manufacturing Research Services Inc., “a key challenge of this approach is that some people and organizations think manufacturing outsourcing means that they are also outsourcing responsibility.” Meltzer added, “The implementation of this final rule makes it even more critical to partner with a mature, well established contract organization that has in place systems to confirm mutual expectations including contractor and sponsor responsibility.”

Failure to establish appropriate procedures and controls over Phase 1 manufacturing may in fact delay drug development and make it more costly. “Sure, you may get your Phase 1 done a bit faster and cheaper, but if the work is not well documented and well controlled, it increases the risk of incorrect development decisions” commented Meltzer.

My R&D Director friend at the Big Pharma Company (who shall remain nameless) pointed out that I seem pessimistic.  She is right I am a bit concerned about this rule, especially as we outsource to less mature markets. 

This concern stems from the experience that individual and organizational responses to regulatory compliance fall into four categories. (See Regulatory Compliance – Nature or Nurture?)

In my experience, many regulatory Zealots and Rationalist are in mature companies, for whom “Thou Shalt Do The Right Thing Even If Not Obliged” has been ingrained into the fabric of the organization. On the other hand, I have a sense that you would find many more Contrarians and Illusionned at less mature organizations.

Although the vast majority of Life-Science companies will do the right thing even if there is no regulatory requirement to oblige them. I am afraid that for some, aggressive development timelines and short term financial pressures may trump patient safety, especially where “doing the right thing” is not a core value.

This is one time when I hope I’m wrong. Because as the adage goes, there is never enough time to do it right, but there is always time to do it over.

In our industry, the consequences of a do-over can be life-threatening.

So please, do the right thing even when no one is looking.


Obecalp Is Clinically Proven More Effective Than Hugs and Kisses

By Daniel R. Matlis

For years I have been joking about some company marketing a sugar pill based on clinical trial data supporting the “placebo effect”.

I never thought I would see the day when this prediction would come true.

Well, today is the day. Efficacy Brands LLC has begun selling Obecalp “…the First Standardized Branded and Pharmaceutical Grade Placebo…”

Jennifer Buettner, the brains behind Obecalp, offers this rational for the product. “Children, adults and seniors shouldn’t be given any type of drug when one is not needed. Until I invented Obecalp there weren’t any options. Now, with Obecalp, the medical authority figure, whether it be a doctor, nurse, or mommy can decide if medicine is needed. If not, Obecalp might just be the answer.” (Why can’t dad be the medical authority figure?)

I could not believe my eyes when she added, “Manufacturing Obecalp with the cGMP process assures our consumers that they are purchasing the finest pharmaceutical grade placebo.”

Wow, where do I start… This is wrong is so many ways.

Asserting to follow cGMPs to manufacture a sugar pill designed to do nothing?  Nice marketing!!!

I agree that we should not give children or adults medicines they don’t need.  So instead, we should lie to them and tell them that a sugar pill will make them better?

What’s the message we are conveying to the next generation?  A pill can solve all your problems? (I know, we have not made pills in a long time, we now make tablets, caplets, gel-caps, etc.)

When one of my children gets a boo-boo, I have found that “kissing the boo-boo better” works in the vast majority of cases.  When that doesn’t, I escalate the treatment to hugs and kisses.

And if I have to resort to sugar to make them feel better, I provide it in the form of a “non cGMP manufactured” lollypop or USDA regulated ice-cream.

The sad part of the story is that, at a reported $5.95 for 50 tablets, Efficacy Brands will probably make lots of money selling Pharmaceutical Grade Placebo tablets.

XOXO anyone?


Life, Liberty and the Access to Promising Investigational Drugs

By Ronald L. Trowbridge, Ph. D.
Volunteer Adjunct Scholar
Abigail Alliance for Better Access to Developmental Drugs

In August, we (Abigail Alliance) lost our case in the D. C. Circuit Court of Appeals.  We are appealing this decision to the Supreme Court.  We argue that terminal patients with no options left but death have a constitutional right to promising investigational drugs already proven safe enough for further testing on people, in the care of a qualified physician.

Recently my partner Steve Walker and I conducted painstaking research that disclosed appalling findings.  We collected data from the FDA, the American Cancer Society, and from a number of research oncologists expert in their respective fields of cancer indication and corresponding drug response.  We focused on the 12 promising investigational drugs that the Alliance had pushed for early access over the past five years, all of which were subsequently approved by the FDA.

In sum, these 12 drugs—had they been available to people denied entry to clinical trials—would have helped well over one million people live extended lives, anywhere from a few months to many years.

Generally, our critics cite four lines of opposition:

1. Our proposal would open a floodgate to quack drugs on the market.  Not true for two reasons:  one, the promising drugs we promote must clear at least Phase I of FDA testing and control; two, a qualified physician must officially prescribe these drugs for individual patients.

2. Our proposal would cause a maelstrom of confusion in record-keeping, given responses to limited patients in clinical trials and responses of unknown thousands of terminal patients to investigational drugs.  But if we can get a man to the moon, we can design software systems that will separately track clinical-trial patients as well as terminal patients getting investigational drugs.  Establishing such dual systems will take diligence, especially at the outset, but it’s doable and worth the effort: extending human lives.

3. Our proposal will harm some terminal patients.  This argument is incredulous, because it says to the terminal patient:  “This drug might not be safe for you, so we won’t let you take it.  You can go ahead and die, but you’ll be safe from the drug.”  As Orwell said in 1984 on doublespeak, war is peace, hate is love, and terminal death is safety.  Let the decision to take a promising investigational drug be between the qualified physician and patient, informed of the risk.

4. Our proposal will discourage patients from entering clinical trials.  Three responses here:  one, our proposal speaks only of terminal patients denied access to clinical trials.  Two, patients will seek the best odds for survival, and why not? Three, the FDA acknowledged in its own legal brief:  “the number of persons who are accepted for participation in clinical trials is relatively small . . . . The number of qualified would-be participants may exceed the number of spaces in the trials.”

This fall the ACCESS Act will be introduced in the House and Senate legislating our proposal.  The Act will permit promising investigational drugs, still regulated by the FDA, to be prescribed to terminal patients.

Dr. Trowbridge was Chief-of-Staff to Chief Justice Warren Burger and the Commission on the Bicentennial of the U. S. Constitution.  Before that, he was appointed by President Reagan, with unanimous confirmation by the U. S. Senate, to a top-level administrative position at the United States Information Agency.  He holds a Ph. D. in English from the University of Michigan.


My Body, My Choice?

By Daniel R. Matlis

No, it’s not what you think; I’m not going “pro” this or “anti” that on you.

I am referring to the Food and Drug Administration’s (FDA) proposal to make experimental drugs widely and easily available to seriously ill patients.

According to Dr. Andrew C. von Eschenbach, Acting FDA Commissioner “This proposed reform is carefully designed to balance several objectives.” von Eschenbach added “One goal is to enable many more patients who lack satisfactory alternatives to have access to unapproved medicines, while balancing the need for safeguarding the individual patient. Another equally important goal is to ensure the continued integrity of the scientific process that brings safe and effective drugs to the market.”

The proposed rule is a direct response to a 2 to 1 decision by the U.S. Court of Appeals for the District of Columbia Circuit overturning a lower court’s ruling in a case brought by the Abigail Alliance for Better Access to Developmental Drugs.

The court ruled that “barring a terminally ill patient from the use of a potentially life saving treatment impinges on the right of self-preservation.” Further, the court held that once drugs have passed safety trials, they should be made available if they might save someone’s life.

Judge Judith W. Rogers wrote “If there is a protected liberty interest in self-determination that includes a right to refuse life-sustaining treatment, even though this will hasten death, then the same liberty interest must include the complementary right of access to potentially life-sustaining medication, in light of the explicit protection accorded ‘life’.”

Dr. Janet Woodcock, FDA’s Deputy Commissioner for Operations stated “FDA hopes this proposal will increase awareness in the healthcare community of the range of options available for obtaining experimental drugs for seriously ill patients,” she added that “By clarifying and streamlining the processes, FDA also hopes to encourage companies to make such drugs available, and reduce barriers for healthcare practitioners in obtaining them.”

The proposed rules, which are open for comment for 90 days, are described in detail at the following FDA web address:

I hope and pray that none of us ever face such a choice, but if we do, it should be our choice to make.