JABbering Stooge

Tuesday, August 23, 2005

Greed is not good

There are a couple of recent stories that should serve as object lessons in why the concept of homo economicus drives corporations to screw consumers in favor of the almighty dollar, and why there needs to be a referee in a capitalist society.

Object Lesson #1: Big Pharmaceuticals

First of all, let's look at the recent jury decision handed down in the Merck liability lawsuit. The jury in the case found the pharmaceutical company liable for $253.4 million in damages in the death of Carol Ernst's husband.

The size of the award is not what is most impressive about the verdict, however. What is most impressive is that this was a Texas jury - not exactly known for sticking up for the little guy - in a case that was supposed to be easy for Merck to dodge accountability on just on the merits of the case.

(BTW, don't expect Mrs. Ernst to see one dime of the award. Even assuming that the verdict is upheld on appeal - unlikely, given the makeup of the appeals courts in this part of the country - the lawyers' fees are likely to eat up most, if not all of the award money.)

It is apparent that what tipped the balance in this case was the revelation that Merck had a long history of trying to hide information about risks associated with taking Vioxx, including a series of training manuals known as "Dodgeball Vioxx," which taught marketers how to "dodge" questions about the drug's safety. Even worse, evidence suggests that Merck knew about the dangers of Vioxx as far back as 1996. Also, in spite of concerns that Merck's advertising materials "have not presented any risk information concerning the contraindications, warnings, precautions or adverse events associated with Vioxx’s use," the FDA approved Vioxx in 1999.

If anything, this case should demonstrate how far Merck and other big pharmaceutical companies are willing to go to rush a product onto market and avoid accountability if anything should happen to consumers of the product. Furthermore, it raises red flags about the FDA's utter inability to enforce safety guidelines at best, and vulnerability to being bought by special interests at worst.

But then, this should come as no surprise to anyone. This is, after all, an industry has turned the business of medicine from a human health concern to a consumeristic enterprise where people are encouraged to consume as many drugs as humanly possible, weather they need to or not. (An exercise for the reader: next time you watch TV or listen to the radio, count how many commercials exhorting you to take this or that "miracle drug" in a given hour. Also, try to see if you can make sense of the safety information provided in a given commercial.)

This is also an industry with a history of engaging in anticompetitive practices such as abusing the patent system to keep generic drugs off the market. Why then, are we surprised to see greed take precedence over being a good corporate citizen?

Given this pattern of behavior in the pharmaceutical industry, another recent story takes on a whole new, frightening dimension.

On August 3rd, the BBC reported that American and British scientists, using computer models, suggested that if the H5N1 "bird flu" virus mutated into a human communicable disease, an outbreak could quickly reach pandemic levels and be about as deadly as the 1918 Spanish flu which claimed 20 to 40 million lives.

However, these same scientists reported that the computer models suggested that the outbreak could be contained if two critical conditions were met.

First, an outbreak would have to be identified while confined to about 30 people. There is a major impediment to this condition being met in that the disease in its current, non-human-transmissible form, is confined to East Asia - from Indonesia in the south to Russia in the north. Most of the governments in this area are notorious for not being forthcoming with information that might cast the government in a bad light.

The second necessary condition would be to immediately dispense enough of the antiviral drug to treat those 30 people AND the 20,000 people nearest to the infected population - about 3 million courses of treatment. A major impediment to this is the fact that we don't know how much time it will take before the virus becomes human-transmissible - thus we may not have enough time to develop an appropriate anti-viral drug and/or produce enough to contain any outbreak.

But let's suppose for a moment that an outbreak is confirmed while confined to 30 people, and there is enough anti-viral on hand to contain the outbreak. Will the drug companies do the ethical thing, and immediately begin dispensing anti-viral durgs, or will they do the profitable thing and let it spread? Remember, the more people infected, the more who will want to buy the drug at exorbitant prices. I think you're intelligent enough to figure it out.


Object Lesson #2: Mad Cow Disease

Bowing to pressure from consumer advocacy groups such as Public Citizen, the USDA released a report that said food inspectors filed 1,036 noncompliance reports between January 2004 and May 2005, essentially accusing U.S. meat plants of shirking their responsibilities as corporate citizens to ensure product safety.

While the meat industry continues to insist that there is no problem, it was the lax enforcement of safety standards that lead to the first instance of mad cow disease in this country. Furthermore, if mad cow-infected beef enters the food supply, it raises the specter of people contracting a variant of Creutzfeldt-Jacob Disease.

But then there's this gem from the USDA:
The USDA’s Food Safety and Inspection Service said its federal meat inspectors strictly enforced the regulations to keep BSE out of the human food supply.

"These data demonstrate inspection program personnel took immediate action when they determined that regulators were not being strictly followed. The analysis demonstrates public health was protected," the agency said in a statement posted on its Web site.


This from an agency that spiked a positive mad-cow test result for seven months.

No wonder why Montana governor Brian Schweitzer called the USDA "a bunch of stooges" that are "in bed with the meat companies." I wish him luck in the inevitable lawsuit by the beef industry.

And so, as we can clearly see, greed is most definitely not good, despite all the protestations to the contrary of the free-market fundamentalists espousing laissez-faire capitalism.

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