A Litany of Pharma Crimes – Part 2 – A Money Business
By Larry Romanoff, March 10, 2022
Part 1, Part 2, Part 3, Part 4
American industry abandoned early on its pretense of making high-quality products, as a natural result of the new mantra of profit maximisation. When American capitalists redefined “long-term” as three months, making a product to last a lifetime became a kind of self-inflicted injury, in that if they manufactured a set of kitchen pots that would last for generations, that purchaser was lost forever as a customer. The natural corollary was that a poor-quality item would require repeated disposal and repurchase, thereby guaranteeing repeat customers and higher profits indefinitely, whereupon our greed-driven captains of industry quickly embarked on a plan to continually degrade product quality and ensure the necessity of continued replacement. By the 1980s, nearly all American multi-nationals and large corporations had joined the race to the bottom.
This important lesson in the economics of greed wasn’t lost on the pharma companies, who realised just as quickly that producing a cure for a disease would have the same result as that from high-quality pots and pans, which is no repeat customers and the death by suicide of their own revenue stream. And that means the major pharma companies are essentially producing what I call ‘pain-killer’ medications, drugs which fail to address the root cause of an illness but which provide temporary relief by masking the symptoms, thereby creating countless millions of drug-dependent repeat customers. More than a few pharmacists have confirmed documented reports that pharma companies mostly invest research dollars into a search for these “control medications”, rather than search for actual cures for an illness. The emphasis is on managing the symptoms while maintaining the disease, very effectively utilising physicians and hospitals as front-line soldiers to convert every patient into a long-term cash stream. (1)
Big pharma is in the disease business, not the cure business. A medical cure is a dead-end road that no pharma company would willingly travel. The only exceptions to this have been a few instances where epidemic-scale diseases were threatening to kill unacceptably-large numbers of the white population, as with the search for a polio vaccine. Then, the industry finds a cure. Professor John Ashton, the president of the UK Faculty of Public Health, accused the Western pharmaceutical industry of ‘moral bankruptcy’ for refusing to research an Ebola vaccine “because the virus only affects Africans”. (2) (3) He wrote that the same attitude existed for decades with the scourge of AIDS because the virus was infecting and killing primarily blacks.
Then we had Dr. Kathy Spreen at Ranbaxy being silenced on her complaints about substandard AIDS medication in Africa on the grounds that “Who cares? It’s just blacks dying”. (4) More on this later. Similarly, the US government for decades ignored the disease of Pellagra which was known to be caused by a simple Niacin vitamin deficiency, watching literally millions of people die needlessly, but failing to act because the deaths occurred mostly in the poverty-stricken black population. In fact, during those decades, both the authorities and the pharma companies ridiculed those deaths, referring to Pellagra as “the slave disease”. Sociopathology at its finest.
I have acquaintances with some knowledge of the pharmaceutical industry who confide suspicions that discovered cures have actually been suppressed in favor of the continued production of control medications, and I have seen some documentation that provides at least circumstantial evidence to support these claims. Naturally, industry apologists are quick to dismiss these accusations as paranoid fantasies and ‘conspiracy theories’, but their denials appear a bit hollow and self-serving. I have seen no indisputable proof the pharma companies have shelved cures, but I harbor no doubts whatever they would do so if opportunities arose.
The truth is that pharmaceutical companies have no incentive to “write themselves out of the equation.” Forbes of course dismisses and derides this as yet another ‘conspiracy theory’, hoping to throw the faithful off the scent and protect the pharma industry from yet another scandal. (5)
To counter some of the industry defenses, we need only think. There is no shortage of examples of discoveries and patents that have been shelved because they threatened someone’s revenue stream, one clear example being General Motors buying and sequestering the worldwide patents for NiMH auto battery technology, an example that industry and the media still desperately want everyone to forget. (6) In spite of all the faux moralistic outrage at such accusations, the pharma companies (and almost every large multinational) are today profit-driven to an insane degree.
When GM will refuse an auto recall for a $0.90 ignition switch (7) or Ford an $11.00 fix for a flaming gas tank (8) because their cost-benefit analyses proved the cost of resulting deaths to be less than that of a repair, there is little point in debating the imaginary ethical standards of big business. Interestingly, industry writers today almost universally classify examples like these as “engineering failures” rather than the “ethical failures” they really were. (9)
And the claims about disease cures being potentially worth untold billions of dollars to a company and eternal fame and glory for the researcher, are Disneyland nonsense. When a country’s national health service can be milked for $150,000 per patient per year for cancer treatments or AIDS medications that cost pennies to produce, fame and glory are a weak incentive to research a disease cure that would serve only to shred the income statement. No pharma company would be so stupid as to collapse its own multi-billion-dollar revenue stream for the sake of either humanity or glory.
There is another unpleasant aspect to this issue, being that in their frenzied pursuit of revenue streams the pharma companies have largely abandoned not only the search for cures, but any path that leads to low profit. One result is that simple medications, often arising from areas like Chinese traditional medicine, may not be patentable. This, combined with a low cost to synthesise and with a corresponding low selling price, will prevent any pursuit in this area.
The pharma companies spend huge sums of money to convince physicians and the public that only patentable synthetic drugs qualify as “real medicine”, and heavily discourage natural or generic sources. They also invest huge time and money to cannibalise their own medications, constantly imagining “new and improved” versions that are seldom better, often worse, almost always with increasingly more serious side effects, but that will sell at far higher prices. Drugs like Pfizer’s Celebrex and Bextra, promoted as massive innovations, were nothing of the sort, specialists claiming they were “no better than the old tried-and-true Ibuprofen, but sold for fifteen times as much”.
It is so bad that pharma companies specialise in “inventing diseases”. ”Pharmaceutical companies regularly pathologize everyday experiences, convince doctors that they are serious problems, tell a hypochondriacal public it needs help and offers the cure: a new drug.” (10)
A further issue is that these firms, again in their single-minded pursuit of profit, have become psychological marketers in the best tradition of Bernays and the advertising industry. One clear result is their great interest in developing what are called “lifestyle drugs”, which are designer drugs for rich Americans for conditions like hair loss and sex drive maintenance, areas in which large segments of the public can be powerfully affected by clever advertising. The pharma companies being big business rather than humanitarian concerns, learned quickly there are far greater profits in the limp phalluses of rich Americans than in a malaria cure among the Malaysian poor.
Also of great concern is what we can call ‘pre-emptive medicine’, the increasingly long list of new medications that are not proposed as cures for medical conditions but rather as preventive measures to forestall such conditions. The theory sounds good, but the experience gained from practice is truly a cautionary tale. Merck’s Vioxx was promoted as a way to prevent heart attacks in the over-65 population but instead proved to cause those same heart attacks, killing much of the population in the process. Ron Unz wrote an excellent article on this that should be considered required reading for every household:
Statins today are a huge fad, excessively promoted by the pharma companies as an essentially harmless wonder drug almost mandatory to protect the world of retired people. These drugs are enormously profitable and an excellent example of pre-emptive medicine combined with lifestyle marketing, but let’s not forget too quickly that Merck’s Vioxx was marketed in essentially the same way, as a ‘preventive’ medication which in the end it most emphatically was not.
Statins are now proving to be as dangerous as Vioxx, with the pharma companies desperately trying to minimise the truly devastating side effects inherent in this range of drugs, carrying a substantial risk of severely debilitating injuries to a not inconsiderable percentage of users. They have a proven ability to destroy musculature and render previously healthy patients into almost corpses. There is no shortage of documented evidence that patients who have been prescribed statins have suffered permanent and debilitating loss of their muscle capacity, previously healthy individuals reduced to the point where they are no longer able to walk more than perhaps 50 meters without suffering uncontrollable muscle exhaustion and pain.
Yet these medications have all been approved by the ‘gold standard’ FDA and are being heavily promoted by all pharma companies as a “necessity” for all those over age 60. The FDA once more has abandoned its prime responsibility to the public, presumably telling itself that the public can read the package warnings, competently evaluate the risks, and make an informed conscious choice. Of course, nothing could be farther from the truth.
In June of 2015 the Washington Post was aflutter with excitement about a “new and improved” class of medication that might eliminate the risk of heart attacks in America forever – statins. (11) Of course, statins have been around for some time, long enough that the patents will soon expire and thus generating another frantic round of absolutely necessary new and improved at ten times the price. Naturally, fluttering media support is helpful in such cases. In (maybe questionable) clinical trials, these new statins appear magical, apparently producing “striking results” on cholesterol but oddly no firm opinion on whether that will actually reduce cardiac events. Nevertheless, we are assured the FDA recognises the huge unmet need for this new drug.
And what is driving this huge unmet need? The profits, primarily, since this new and improved breed will cost each patient about $10,000 per year. If we multiply that by the almost 50 million US residents over age 65 – the primary victims of this new medical miracle – we get the nice round number of $500 billion dollars. What else is there to say, except to note that most of these new miracle drugs in the past 30 years have had a bad habit of causing more heart attacks than they prevented. Merck’s Zocor was one of these. If you recall, the FDA did a field trial and discovered that this miracle statin not only failed to prevent cardiac arrests but in fact doubled their incidence. Vioxx was the same. But in all the excitement everybody seems to have forgotten.
And it wasn’t only Zocor and Vioxx. As of early 2003, Bayer had paid well over $1 billion to settle thousands of lawsuits worldwide for deaths and severe muscle deterioration resulting from the use of the company’s Baycol statin medication. Approved by the FDA in 1997 without proper testing or oversight, Baycol had to be withdrawn from the market in 2001 due to its dangerous effects. Pfizer’s statin, Lipitor, was also facing a huge wave of lawsuits from injuries due to serious side effects in spite of being the best-selling prescription drug of all time, with total global sales of more than $130 billion. With more than 50 million users, Pfizer may have no shortage of lawsuits. Statins are so profitable and the FDA’s approval process so reckless that pharma companies continue to produce and sell new versions even more deadly.
Health Supplements, or simple vitamins, are another category that is thriving from the massive promotional campaign carried on worldwide, again a preventive medicine taken not because its needed, but to prevent its need. I believe this is one of the greatest medical hoaxes perpetrated thus far, since excess vitamins are simply excreted by the body and are a waste of money. Any normal diet has always provided, and provides today, the necessary vitamin intake for good health. The few individuals suffering from vitamin deficiencies should be under the care of a physician rather than spending inordinate amounts of money on what are almost entirely useless pills.
The industry was created in the US by American pharma companies and advertising agencies, with the benefit of large bribes to the medical profession, to the extent that Americans now spend nearly $8 billion per year on these pills to no purpose. There is no question the problems are widespread, the fad having been created by clever marketing that targets sincere interest in health, then hijacked by those who value money more than ethics – precisely the same situation existing in the pharma market generally.
These firms are not marketing vitamins because the public needs them but simply because they are hugely profitable, in many cases costing only pennies to manufacture but selling for many tens of dollars per bottle. No person anywhere should purchase any of these items unless their physician detects a deficiency that cannot be easily remedied by other means. This vitamin industry has become so loaded with infatuation and misinformation that even a soap company like Amway is making billions of dollars selling re-manufactured pills they probably don’t even understand.
Even worse, most of the ‘health supplements’ or vitamins offered for sale are not what they appear to be, a great many of even the best brands being nothing more than a concoction of what the industry calls “fillers” – ground-up rice, wheat or soybeans with absolutely no trace of Vitamin A or Alpha-Omega or any other high-sounding health additive. Anahad O’Connor wrote a perfect article in the New York Times in November of 2013, detailing the widespread fraud existing in the health supplement market and noting that DNA tests show that many pills labeled as healing herbs are nothing more than powdered rice and weeds. (12)
Canadian researchers tested 44 bottles of the more popular supplements sold by many different companies and discovered that most were either heavily diluted with, or entirely replaced by, cheap fillers like soybean, wheat and rice. The findings of this study were published in the journal BMC Medicine, (13) and concur with other studies conducted elsewhere that indicate the health supplement industry is even more corrupt than its pharmaceutical big brother.
Pharma Pricing Strategies
In June of 2013, the London Telegraph produced an astonishingly scandalous article that served to confirm the things we’ve always believed about drug prices, in this case the newspaper recording conversations with drug company executives boasting like schoolboys about selling prescription drugs for many hundreds of dollars when they cost only pennies to produce. (14) Several drug companies were willing and even eager to offer discounts of 70% or more to any pharmacist or hospital willing to prescribe their medications, with the understanding these would be billed at full prices to the Health Service and to the patients.
The Telegraph used undercover reporters posing as investors planning to open a large chain of retail pharmacies, and recorded their meetings with pharma executives, producing extensive proof of the collusion to manipulate drug prices to unconscionable levels, systematically overcharging the national health services in many countries by billions of dollars each year.
The pharma companies are so overcome by greed that no amount of profit is ever sufficient, with abundant evidence in categories of drugs that are vital to the preservation of life as in many cancer drugs and those used to control AIDS. Many vital cancer medications are priced at $50,000 to $100,000 per year and more, when the production costs are often only a few dollars.
As a typical example, in late 2013, in response to unprecedented public protests, a large group of over 100 consumer organisations in 35 states launched a massive class action against Abbott for anti-trust violations in increasing the price of a critical anti-AIDS drug by over 500%, from $200.00 to over $1,000.00 per package. These public actions included boycotts by physicians, demonstrations at the company’s annual meetings, and a general storm of public condemnation for this profiteering. Abbott stubbornly refused to reconsider its price increase, leading the US Health Service to request that Abbott be stripped of its patent and generic versions of the drug be approved for other manufacturers. Abbott, like all pharma companies, will abandon both morality and humanity if given even a slight monopoly on a life-saving medication.
Most national governments are eager to see an expansion of domestic R&D, and easily fall prey to research scams perpetrated by the pharma companies who promise to greatly magnify their research expenditures in a nation in exchange for longer periods of patent protection. Too many naïve governments have fallen for this ruse, only to discover that the promised research never materialised, and often that the expenditures included in so-called research were little more than daily operating expenses or clinical trials for medications that had already been developed elsewhere. I am unaware of any instances where these undertakings were actually kept, and they remind me of the false promises made by so many American firms entering into JVs in China, where promises to develop and promote domestic brands proved to be plans to milk the JVs dry and kill the brands instead.
In a National Post article in October of 2014, Tom Blackwell wrote that some years ago Canada entered an agreement with the international pharma companies to greatly lengthen their patent protection in exchange for a commitment to spend 10% of all revenue on R&D. In practice, the companies in totality reneged on their commitment, with R&D being at 4% or below, and even this figure being loaded with questionable expenses. (15) “The entire process was simply a cash grab with no intent to honor the research commitment. When presented with the evidence of these breaches of contract, the pharma companies invariably blamed Canada or other governments, claiming their local divisions have grave difficulty competing internationally, and lay the blame for this condition on the same government or its regulatory system or IP protection.”
As Blackwell pointed out, the extension of these drug monopolies not only delays entry of much-cheaper generics, but actually makes it harder for small domestic pharma companies to innovate, as their work often stems from existing medicines that are off patent. In all research, there is also the matter of the extreme emphasis on profit and marketability, driven by the business schools and large capitalists, which in the end will destroy the entire idea of scientific research and twist university research facilities into mis-shapen profit incubators bereft of any thought of benefit to humanity or society generally. It is also true that this insane and greed-driven push to maximise profits will almost assuredly serve to prevent truly useful medical discoveries since profits arise from controlling a disease rather than from curing it. It is only within the confines of truly non-profit and totally corporate-independent facilities that socially beneficial research will be conducted.
The secret non-elected government of the European Community organised a well-thought-out plan to benefit their European pharma companies friends by what was presented as an advanced method of encouraging pharmacological research for the good of the world. Their newly-created “Innovative Medicines Initiative”, (16) which was to be “an alliance of corporations and universities” with the aim of developing new medications, a program with billions in funding – all drawn from taxpayer money, of course. The stated goal was to encourage innovation in the creation of essential medicines through funding universities and small research companies. But this great initiative has been a complete disaster for everyone but the pharma companies for whom it was designed.
Through this program, the EU has siphoned off literally billions of dollars which have almost entirely disappeared into the coffers of the large Jewish European pharma companies – which are owned by the same individuals in the EU government who crafted this scheme. The German newspaper der Spiegel did an excellent review of this matter, demonstrating that the billions of dollars of taxpayer money have been spent almost exclusively as a tax-free subsidy to the pharma industry.
Auto companies do the same thing, promising to build factories, expand production, create new jobs, but invariably fail to adhere to the promises, often doing the opposite of cutting jobs and closing factories. And in every case I have investigated, these contracts have never contained penalty clauses for failing to meet the commitments, meaning that local governments saddled their population with many extra years of much higher drug prices, and received nothing of benefit in exchange. These agreements have almost always been a one-sided hoax.
Next: Part 3 – Side Effects & Trials
Mr. Romanoff’s writing has been translated into 32 languages and his articles posted on more than 150 foreign-language news and politics websites in more than 30 countries, as well as more than 100 English language platforms. Larry Romanoff is a retired management consultant and businessman. He has held senior executive positions in international consulting firms, and owned an international import-export business. He has been a visiting professor at Shanghai’s Fudan University, presenting case studies in international affairs to senior EMBA classes. Mr. Romanoff lives in Shanghai and is currently writing a series of ten books generally related to China and the West. He is one of the contributing authors to Cynthia McKinney’s new anthology ‘When China Sneezes’. (Chapt. 2 — Dealing with Demons).
His full archive can be seen at https://www.bluemoonofshanghai.com/ + https://www.moonofshanghai.com/
He can be contacted at: email@example.com
Notes Pharma Part 2
Curing Disease Is Bad For Business: How Do Big Pharma Companies Continue Their Growth?
Dr John Ashton Claims Pharmaceutical Industry Ignoring Need For Ebola Vaccine
Ebola outbreak: Western drugs firms have not tried to find vaccine ‘because virus only affects Africans
Special report: Dirty medicine
Some Think Big Pharma Is Suppressing A Cure For Cancer. Here’s Why That Could Never Happen
Patent encumbrance of large automotive NiMH batteries
GM Facing a Snowstorm of Suits Over Its Ignition Switch Recall
The Ford Pinto Case and the Development of Auto Safety Regulations, 1893-1978
The Top Automotive Engineering Failures: The Ford Pinto Fuel Ta
Malady Mongers: How Drug Companies Sell Treatments By Inventing Diseases
New method of deciding who should take statins is accurate and cost-effective, new studies show
Herbal Supplements Are Often Not What They Seem
Pharmaceutical scandal: firms boast of profits on drugs that cost ‘pennies’
Drug companies well short of research spending they promised in exchange for longer patent protection
Innovative medicines initiative
Copyright © Larry Romanoff, Blue Moon of Shanghai, Moon of Shanghai, 2022