Healthy Skepticism Library item: 1431

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Publication type: news

Mathews A.
FDA Chief Targets Europe's Controls On Drug Prices
The Wall Street Journal 2003 Sep 25

Full text:

WASHINGTON — The head of the Food and Drug Administration is expected to warn that wealthy nations need to more fairly share the cost of developing new drugs, and to criticize price controls maintained by some European and other countries that force Americans to shoulder too much of the burden.

The message from FDA Commissioner Mark McClellan comes as the disparity between U.S. and foreign drug prices is becoming an increasingly potent political issue, and Americans are seeking to import cheaper medicines from Canada and abroad.

The FDA has opposed bills before Congress that would ease restrictions on the practice, arguing that the agency can’t assure the safety of drugs coming from beyond U.S. borders.

In a draft of a speech Dr. McClellan is expected to deliver Thursday to a group of international pharmaceuticals executives meeting in Cancun, Mexico, the commissioner says “we are not all paying our fair share of the costs” of bringing new medicines to the world. The U.S. “cannot carry the lion’s share of this burden for much longer,” he says later.

If it becomes a higher-profile priority for the Bush administration, the issue could open up a new point of tension between the U.S. and European nations already at odds over Iraq and other matters.

But it isn’t clear what, if anything, the U.S. could do to raise drug-price controls as a trade concern. The speech reflects discussions within the administration, according to a person familiar with the matter.

Americans account for about half of world-wide pharmaceuticals spending, Dr. McClellan’s draft says. He is expected to warn that “everyone’s effort to get a free ride on new drugs will grind the global development of new drugs to a halt.” That would be “unfair and unjust,” he says, adding, “it’s unfair to Americans, who are bearing an increasing share of the burden, and cannot be expected to do so indefinitely,” and also to the rest of the world.

The World Trade Organization recently agreed that poor countries can import generic copies of patented drugs for health scourges such as AIDS, and drug-making nations such as Brazil can produce such drugs if they export the copies at low prices solely to needy nations. That may also put more pressure on wealthy nations to support drug development.

In the draft speech, Dr. McClellan proposes that industrialized nations work together to find ways to fairly divide the cost. One option, he says, might be to tie drug expenditures to a nation’s ability to pay. The “average price of important medical breakthroughs ought to bear some relation to a nation’s income,” the draft says.

Dr. McClellan, an economist and physician who served as a White House official before taking over as FDA commissioner in November, has made drug-price concerns a high priority. He has encouraged initiatives, such as a move to speed the approval of generic drugs in the U.S., that are designed to curb escalating prescription-drug costs. He has also said he wants to make the FDA’s drug-review process quicker and more efficient.