Hands Off My Industry

By SIDNEY TAUREL

Medicine has been transformed by pharmaceutical innovation. We've seen the
widespread use of antibiotics, the discovery of agents for cancer, major
advances in cardiovascular medicine. We've seen the development of new
treatments for depression and the advent of drugs that make organ transplants
possible and chemotherapy bearable. Today, we are experiencing the breakthroughs
of biotechnology and the consequent surge of new therapeutic proteins.

Many organizations and dedicated people have participated in this medical
advancement. Importantly, it is the working partnership between government
agencies, like the National Institutes of Health, academic institutions, and the
pharmaceutical industry that has fueled this progress, bringing to people of all
societies the medicines for a healthier and longer life.

If you appreciate the medical breakthroughs of the past 50 years, you should be
concerned about the public policy debate in Washington. Today, there are bills
before Congress that have the potential to decimate pharmaceutical innovation.
One provision, the legalization of prescription drug importation, would have the
effect of importing damaging price controls from other countries. Other
provisions would significantly weaken patent protection for pharmaceuticals.

I believe support for such legislation is due in large part to our critics'
ability to trivialize the role of the pharmaceutical industry in medical
innovation. Specifically, they perpetuate the belief that government and
academic institutions are solely responsible for the discovery and development
of new medicines. Their argument can be refuted by data from government sources.
In 2001, Congress asked the NIH for a report of its involvement in all drugs
with sales of more than $500 million a year. The NIH reported that 47
prescription drugs met the criteria. Of those, the NIH contributed to the
discovery or development of four -- primarily through its program of grants to
universities and research institutions. Looking at a broader range of
pharmaceuticals, scholars at Tufts examined all 284 new medicines approved in
the U.S. in the '90s. They found that 93% originated from the pharmaceutical
industry, with 7% split between government and academic or nonprofit sources.

At a deeper level, this comparison is based on the faulty premise that public-
and private-sector scientists are competitors in the search for new therapies.
In fact, both pursue quite separate objectives, which nonetheless complement one
another. Generally, academic research, like that of the NIH, is not focused on
anything so specific and resource-intensive as drug discovery. Rather, academic
scientists are free to range over the vast puzzle of health and illness, helping
to expand our understanding of both physiology and pathophysiology. In a vast
majority of cases, these scientists may not produce new drugs or ingredients but
rather observations of biology. These generate ideas and hypotheses about the
biochemistry of a disease state, which may offer a new target for drug
discovery.

This represents the very early part of the "R" in pharmaceutical R&D. The
remainder of the continuum, the long and costly process of research and
development, is left to the pharmaceutical industry. These stages of the R&D
process take many years and require staggering investments, more than $800
million per drug. They begin with hypothesizing about the biochemistry of a
disease state, developing and optimizing drug candidates, conducting
pre-clinical work, and then transitioning to years of clinical studies. The odds
of success are daunting; an extraordinarily small number of drug candidates
ultimately recoup their cost of development. These efforts are what it takes to
turn that question mark from the academic into the exclamation point in the
physician's hands. This, in the full sense, is where drugs come from.

The critics who claim the industry does not innovate also attempt to advance the
notion that new drugs created by the industry aren't really new. FDA data reveal
a different story. From 1998 to 2003, the FDA has approved 136 new molecular
entities. Sixty of these molecules, or 45%, were given priority review. The
agency does this only when it believes both the medical urgency and potential
therapeutic value are significant enough to warrant a fast-track review. In just
the last 10 years, the industry has generated a steady flow of new classes of
drugs, many representing first-ever therapies for serious medical needs, while
others amount to much-improved options. For instance:

• Diabetes care: New agents for managing blood-sugar levels, notably, the TZD
class and several new types of biotech insulin.

• Cardiovascular: New classes of drugs for hypertension and lowering
cholesterol and the development of several anti-platelet and anti-clotting
agents for treating heart attacks.

• Central nervous system: The advent of atypical antipsychotics, which have
been revolutionary in the treatment of schizophrenia and bipolar disorder.

• Infectious diseases: Four new classes of drugs for HIV/AIDS developed to
target the three different stages of the virus.

• Oncology: New treatments for colorectal and pancreatic cancers as well as
targeted cancer agents for chronic myeloid leukemia and breast cancer.


Looking to the future, one can see the tremendous potential for the flow of
pharmaceutical innovation to expand and accelerate. In terms of the science, we
are now in the early stages of a revolution in biomedicine, an explosion of new
knowledge that will translate into a whole host of new and better medicines.
Yet, the business of finding these new medicines is risky and costly. No one is
guaranteed to achieve the financial returns that encourage investment in
pharmaceutical R&D. However, two important principles guarantee that such a
return is possible: a market-based system of pricing, and intellectual property
protection. The legislation before Congress has enormous consequences for these
distinct features of our economic system.

The question our policy makers need to ponder is: What happens to pharmaceutical
R&D if these two principles are compromised to any significant degree? I
sincerely believe that, by compromising these principles, we could see the
collapse of true innovation in biomedicine, therefore vanquishing the hopes of
making advances against devastating illnesses like Alzheimer's, cancer, heart
disease, and diabetes.

It is up to Congress to decide. Their choice will shape the future of medicine.

Mr. Taurel is the president, chairman, and chief executive officer of Eli Lilly
.

Updated November 3, 2003

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