Episode 31: Theo Tiffney on the Two C’s – Hepatitis, and Capitalism
Image: Electron micrograph of hepatitis C virus purified from cell culture. (Source: Wikimedia Commons)
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Hello, this is Assigned Scientist at Bachelor’s, the only science podcast I know about with no cis people allowed. I’m Charles and I’m an entomologist.
And I’m Tessa and I’m an astrobiologist.
And today as our guest we have a very special guests, the person who introduced the two of us, Theo Tiffney. Theo’s research interests are in ethics and policy issues of infectious disease response. Their dissertation research focused on the history of the development of hepatitis C, direct acting antivirals and the resulting barriers to hepatitis C treatment access. Currently, they are interested in the policy failures and health justice aspects of COVID-19, particularly overlapping with existing systematic problems made evident by hepatitis C. Theo, welcome to the show.
It is great to be here.
It’s great to have you on. Normally to start out we ask people sort of – how did you get interested in science?
Well, I grew up in a family of scientists. So you know, Grandpa, dad, my uncle, my aunt, my other uncle, etc – my grandma and my grandpa all had PhDs, except pretty much all of them were botanists. And unfortunately, I don’t find plants very interesting. So when I went to college, I was focused on…
I know, right? I know I’m, I am the the black sheep of the family. When I went to college, I found myself really interested in entomology. So I was working in a field biology laboratory that had a little entomology project on the side, and I was having just a grand time going through keying out the bugs present in Southern California ecosystems. And then the lab freezer broke and destroyed all of the bugs in there. So that project was scrapped. And I found myself working in my undergraduate advisors lab at UC Santa Barbara – Kathy Volts – and taking care of sea urchins and doing developmental biology stuff with sea urchins. And in the middle of the summer, when I was working there and doing a small project on sea urchin metamorphosis, there was an outbreak of a disease of sea urchins that pretty much killed a lot of the urchins in all of the laboratories. It made me really curious about sea urchin diseases.
I then signed up to, on top of my coursework, work in another laboratory that was doing a different type of disease outbreak in local populations, which was chytridiomycosis in the local amphibian populations. It is a fungal infection of amphibians that is responsible in large part for the world and phibian decline, it is quite deadly, and basically inhibits their ability to respirate through their skins. And it’s pretty much everywhere at this juncture. And that includes the mountains of Southern California, where we have a number of endangered amphibian species. What I was also up to was doing a minor in history, because I’ve always been interested in history – and, teaching a course on human diseases and public health… and I was, at this point, contemplating making the jump from amphibian and echinoderm biology and infectious disease biology into doing stuff with humans, because this was really interesting. In the middle of all this two things happen. I did not get into graduate school to do evolution of infectious disease, which was what I really wanted to do. Also, this is 2014, which for the disease nerds out there, you know as the largest Ebola virus disease outbreak in history, and I’ve been, you know, very interested in Ebola, I think as most infectious disease nerds are… I think it happens a lot because, like, The Hot Zone is this readily accessible… I’m going to call it a novel because it is not a realistic depiction of the actual disease… about Ebola that’s like very exciting, very much draws you in and gets you interested in issues.
Well, mostly it gave me nightmares.
I mean, yeah. I much recommend spillover by David Quammen.
Yeah, Spillover’s fantastic
Spillover’s fantastic, and it is a much more measured look at like, what this disease actually looks like and what this disease actually does.
I feel like it would still give me nightmares probably.
Well, the thing about that one is, it talks about it in the context of a bunch of other diseases. So the Ebola is not going to be the first thing in that book that gives you nightmares.
[all laugh] That’s reassuring.
I know right? Watching what was going on there, watching where the problems were arising, made me realize that maybe I should be looking at other ways to study infectious disease that didn’t require me to pass statistics, which was a problem at that juncture. I took a year off to reapply to grad school and to sulk, frankly, and then I reapplied to a lot of like history and philosophy of science programs, and bioethics programs, one of which was the Center for Biology and Society at ASU.
This is actually a really fascinating, like, two ships pass in the night situation, because we applied to the same program in the same year. And you were accepted, and I was rejected. And then I went and I got my master’s and I reapplied and now… and now we’re friends.
So you reapplied – Center for Biology and Society. Here we go.
Got in, yeah, started working with Robert Cook-Deegan, who had just come in as faculty for the School for the Future of Innovation and Society. And he kind of pointed me at the issue of hepatitis C.
Could you just briefly give some context on hepatitis C? Like, what is it what happens to people with it, etc?
Alright, so just for starting points, okay, we’ve got multiple viral hepatitises – I think they’re up through like hepatitis e by now, I’m not entirely sure because I focus on the one. They are not related to each other. They are clumped together largely because, before we could do like complicated molecular biology things to differentiate these viruses, they all cause the similar range of symptoms, which is they attack and destroy the liver.
You talking about this now makes me want to pivot into philosophy of viral taxonomy.
Yeah, I mean, early on, they were just basically like, oh, a sharam transmitted jaundices, and that’s basically because, when your liver stops working and your body starts and getting all the toxins your liver was supposed to filter out dumped into it, you kind of turn yellow – the whites of your eyes go yellow, your skin kind of does, you get all these really unpleasant symptoms. Like, you itch all over, fluid retention in places fluid shouldn’t be retained, fevers, there’s brain fog and cognitive impairment from these toxins, it’s just extremely unpleasant. Hepatitis is, in general… it just causes your liver to quit working, so you’d start showing symptoms of liver failure.
Up until the late 1980s they hadn’t really differentiated that many of them. Now hepatitis A was first diagnosed as a virus, it’s a pretty short course that you can get it from having contact with fecal matter containing the virus. So there was an outbreak in LA a couple of years ago, largely because LA has not provided sufficient bathroom facilities for its homeless population. And basically, you get hepatitis A, you have a bad time, and then it goes away on its own most of the time. And then Hepatitis B can be transmitted through blood transfusion, blood products, shared needles, it can be passed down mother to child, I’m not 100% sure if it can also be sexually transmitted, but… and so they diagnosed with hepatitis A and hepatitis B early on, we’re like, okay, these are two different viruses. And we can actually, like detect antigens to Hepatitis B in blood products.
And then someone was like, Wait a second, we have all these patients with hepatitis like symptoms years after they received heart surgeries in this one hospital and they don’t have hepatitis B antigens, we’re guessing this might be a hepatitis C. And then because they didn’t really want to rule anything out, they spent a couple of years calling it non-A, non-B hepatitis. And then 1980s, somebody came along and did some really remarkable molecular biology wizardry involving DNA clones, and they basically managed to identify a genetic sequence of a new virus. And a whole batch of other things sort of came to light around the same time about why this had been so elusive, and one of which was – it’s a very small virus, so earlier techniques that weren’t based on molecular biology hadn’t worked because it was really small. And then the other thing was, it’s actually a pretty genetically diverse virus. It’s got a whole bunch of different genotypes that are present at different prevalences throughout the world.
Related to that how, given the genetic diversity… what is it that enabled researchers to identify all of them as the same virus?
They managed to identify one specific one with… essentially, they threw things at the wall until they stuck. And the things here were clone sequences of DNA. And they basically had a whole batch of different sequences of the stuff and put it into infected tissue to see what – if anything, like, literally stuck to it, this is a grossly oversimplified version of it. But when they did find that there was one particular DNA clone sequence that was sticking to something in infectious tissue, and only in infectious tissue, and, in not the control tissue, which was to sort of rule out it sticking to, I think, in this case, chimpanzee DNA, they went, wait a minute, I think, like, this might be it, and this is present, and all… this will stick in all infected individuals, and it won’t stick in non-infected individuals. So we think we’ve got something here. And there was a whole batch of, you know, sequencing out, checking it against other viruses turned out very similar genetic sequence to yellow fever, which is a relative of hepatitis C, and a whole batch of the other flavoviruses, which… flavoviruses are generally nasty. And you’ve heard a lot of them in the news. They’re like, uh, Zika, yellow fever, dengue fever, West Nile, etc. – usually insect transmitted, but there are… but hepatitis C is one of them.
And then they tried to grow it in culture, which did not work, because it turned out that they had a slightly incomplete version of the virus with this technique. So it took a few years to iron that out. And then there was a whole batch of time of finding the correct type of cells to grow the virus in, and the correct strain of the virus that could be grown in cells. And then finally, after all of that, work could begin on drugs to inhibit it. So this was all, all of this sequence was like 1989 through the early 2000s. Meanwhile, people had hepatitis C, and it was primarily, (a) people who had had medical procedures done before 1992, which was when it became possible to identify the virus in the blood supply and organ donations – especially among those: veterans – and so for these people, the standard of treatment was something called combination therapy, which was at first just interferon and then later on, it was combined with a ribavirin in order to try and destroy as many of the virons in the body as possible. The problem with this treatment was, it wasn’t very effective.
So interferon is a product of the body’s immune system. And essentially, when you put it in someone, their immune system goes bananas, and it just carpet bombs the entire body – like fever, aches, pains, flu like symptoms, etc. It makes the human immune system go bananas. Basically, this indiscriminately attacks, whatever bugs might be in the body that you don’t want in there. And this indiscriminant type of attack was one of the few things that was available to treat hepatitis C, because like, there, there really wasn’t much else. It was absolutely miserable. One of the patients I talked to was like, it was, without a doubt, the worst thing that’s ever happened to me, like going through this therapy. But the alternative of liver failure and death was even worse. The efficacy of combination therapy for all of it side effects, and in some cases, it could even trigger autoimmune disorders because, you know, when you get the immune system that excited for that long things kind of go wrong sometimes.
This is a great moment to return to the refrain that colors a lot of our episodes, which is just the sheer absolute nightmare of living inside of an organic body.
It’s, it’s very true.
It’s not great in here.
Yeah, yeah. So you’d go through absolute hell. And if you had the right genotype of hepatitis C that was particularly responsive to combination therapy, and if you didn’t also have HIV, which was fairly common in hepatitis C patients because they are transmitted almost identically except hepatitis C is not as good at sexual transmission as HIV is and then there was significantly lower efficacy along racial lines – so like if you had hit the jackpot, the type of hepatitis C you had and not having other conditions that would inhibit your immune response, you had about a 60% chance of being cured.
That is not high.
AT most. And then like some other groups were talking much lower than that – like, in the 30% range. So there was… and then, you know, if you failed interferon, you needed a new liver, you got your new liver, but you still had hepatitis C, so it would destroy that liver too. So then you had hepatitis C, and you know that the immune suppressants, etc, that you have to have for a new liver. So it was, it was bad, there was a serious need for a new drug to treat this. And this small pharmaceutical startup called Pharmasset, founded in the early 2000s, realized it potentially had a drug to do that. So first patent on this sucker was filed in like 2003. And they started refining it down. And it was what’s called a direct acting antiviral and direct acting antivirals are very interesting class of drugs. And they can either be incredibly targeted, incredibly useful, or actually pretty dang toxic to the human body, they were considered quite dangerous before hepatitis C drugs really came on the market. One example of this is a drug called idocs. urethane, I don’t already and essentially, it mimics a particular DNA sequence. So when the virus is going along and replicating, it’s kind of pulling stuff out of the cytoplasm, sticking it on the daughter DNA, or RNA, strands and going on its merry way.
And what, uh, what direct acting antivirals do is that they mimic specific sequences, like of base pairs that can be stuck on the daughter DNA strand, or RNA strand, and function. And… but then they’re not quite right. So when the daughter virons try to function or try to replicate, they don’t, ’cause they’ve got the wrong sequence. So idoxuridines’s problem is, it doesn’t just mimic the sequence from the herpes virus, it can be mistaken by human cells, too. And this causes cell death. So when it’s used in these applications, it’s usually pretty short course – you don’t ingest it, you just put it on the thing that’s infected with the herpes virus, like you try and minimize your exposure to it. And like long term it can cause… if you’re using it consistently, it can also cause scarring of the eye as well as…
Yeah, it’s not great.
It’s I… you know, I need those.
I know, right? The really neat thing about the direct acting antiviral Pharmasset was working on was that it targeted a specific sequence in the hepatitis C viruses genome that was used specifically in replication. And it was is quite well targeted to this. So same method, you know, the virus goes to replicate, unzips its RNA, polymerase scorches along the daughter DNA strands pulling in things from the cytoplasm to stick to it and picks up this drug, which became to be known as Sofosbuvir, sticks it on… their daughter virons now exist, daughter virus now exists in a way that does not allow them to replicate. So they stopped being a problem. And the other really neat thing about how they design this drug was, they had an initial problem, which was that it could not get through the cell membrane, because it couldn’t get through the lipid membrane of the cell… how to, like, coat it in a thing that got it through that lipid membrane, but then once it was released in the lipid membrane got broken down, it could not get back out. And the genius of this is, when you ingest something, it immediately, like when your blood cells pick it up, it immediately goes to your liver,
What… like, why?
It puts whatever you’ve ingested in your liver to get like filtered first for toxins, right? So this stuff would get picked up, taken to the liver, dumped in a liver cell and not be able to get back out. Hepatitis C concentrates in the liver. So they basically just managed to dump all of this drug right where it was needed without it affecting the rest of the body. And they came up with this, like, incredibly effective treatment that didn’t really cause side effects, because it was just hanging out in the liver doing its job stopping Hepatitis C virus from replicating.
Do you know much about the liver, like as an organ? Like, what’s it doing in there?
I mean, mostly it’s, it’s processing – mostly it’s just processing stuff to make sure things that should get into your bloodstream do and things that shouldn’t, don’t.
Just thinking about how I don’t understand organs, I guess
[So] we have this drug that seems to work pretty well and has minimal side effects.
Yep. And it started, you know, it goes into clinical trials. It’s doing great. It’s combined with combination therapy, we’re seeing efficacies of like, 90+ % in the treatment groups that people were actually getting the drug, and other pharmaceutical companies start taking interest in it. A common thing that happens in the pharmaceutical world is that the really big companies, like, are not doing that much of their research in house. They sort of just keep an eye on the smaller startup companies. And then when somebody has something good the big company comes in acquire them. So this is what happens to Pharmasset, Gilead Sciences…
Yeah! Um, Gilead Sciences, which at that point had been primarily HIV drug focused company, saw this was… like, our in house hepatitis C research is not going so hot. And then they turned around and bought Pharmasset for $11 billion, which is a sum that sounds big to all of you and it was actually a sum that sounded big to the pharmaceutical world as well and Gilead, its stockholders all freaked out.
And actually, their, their stock value dropped precipitously shortly after they announced this treatment because everyone was like, You spent so much money. This is such a big gamble. But fortunately for Gilead’s finances, the gamble panned out. And Sovosbuvir, this really exciting drug, made it through clinical trials, got FDA approved in December of 2013. And Gilead went, awesome, great. We’re going to sell this for $84,000 per course of treatment.
And when we combine this with one of our own direct acting antivirals, so people don’t have to do any combination therapy with us at all anymore – and that had even higher efficacy rates – we’re gonna sell the. that one for like $96,000 for a course of treatment. That’s going to be great guys, we’ll make so much money.
Just the, just the notion that people are trying to make money off of health care is so obviously ghoulish.
Well, I mean, it, it keeps going, um…
So Okay, so back to our poor hepatitis C treatment patients – as the rumblings got clearer and clearer that, hey, there’s actually something that can cure this sucker that doesn’t require you to essentially give yourself the flu three times a week for six months and will not make you horrendously depressed, seriously your inhibit your ability to have kids because it was [unknown], could cause fetal malformations, we can… let’s just like, it’s a slow… hepatitis C a slow moving disease, it takes years to show symptoms that takes years to die of, it just, like, hang on for a couple of years so we can treat you with these new effective drugs. So there is a bolus of patients who are waiting for this drug. And it hits the market at $84,000 plus the cost of interferon and $96,000 per course of treatment with some people needing more than one course of treatment, depending on genotype, everybody freaked out.
And essentially, they were like most most essentially, the payers freaked out and payers here mean, like, private insurance companies, and publicly funded health care systems like Medicare, Medicaid, the VA, the Indian Health Service and prison systems. At first private insurance handled it fairly well and was able to provide for the patient. But because of the way that hepatitis C is transmitted, it primarily affects some of the most disenfranchised people in the world, and specifically some of the most stressed and disenfranchised people in the US, because if you’ve been watching the news, the other thing that was going on in the late 1990s to present day that was a huge public health issue was the opioid epidemic.
And as things like oxycontin were reformulated to discourage abuse, people turned to riskier sources like injectable heroin. And without needle exchange programs to ensure they were getting access to clean needles, this meant spreading hepatitis C and HIV. And because of the consistent criminalization of injection drug use in this country, that meant that a disproportionate number of hepatitis C patients wound up in prison for some portion of their illness. It also meant, because of the poverty that this whole system inflicts on people who inject drugs, that a lot of these people were reliant on things like Medicaid for their treatment. So essentially all the people who needed it most, all the people at the highest risk for… at the highest risk for the worst outcomes for it, were on these public systems that are frankly chronically underfunded.
And these public health systems with a large quantity of patients in one hand, and an $84,000 per patient bill on the other, panicked. They instituted rationing, that is basically almost the sickest people with their livers in the worst shape could get it, they restricted people who could get it to people who had been seen by a specialist, and then one of the worst restrictions they implemented was people that had substance abuse disorder, people who inject drugs, could not get the drugs to treat their disease at all, which was ridiculous, because the people at highest risk for not only getting this disease, but transmitting it were often people who injected drugs and prison systems. Gilead had decided that it was only going to offer the drugs at lower cost to 5 out of 50 state prison systems because it wasn’t profitable enough to provide it to the others.
[sighs deeply] Bad.
Yeah. So a whole bunch of people who needed it the most could not access treatment. And as a result, the prevalence of hepatitis C in the United States between 2014 and 2016, after the drug was released, after it had been approved, the prevalence of people who have hepatitis C in the United States rose. They cured the disease and the prevalence rose.
It’s… capitalism is a public health crisis.
Well, let’s also, let’s also talk about the capitalism side of this.
Sofosbuvir is cheap to produce. I think at this point, we’ve gotten enough data we can say, Sofosbuvir and other… in combination with some of the other direct acting antivirals that have come out since then, you can make a course of treatment for like 20 to 30 bucks, and you can sell it for 100 bucks with a fair degree of profit. So, cheap to make. Problem is, the disease has risen. Do either of you remember the newspaper article that came out a couple years ago, with, I think it was Goldman Sachs, talking about how it wasn’t profitable to make too effective a drug because you cured your customer base and you ran out…
I do remember that, yeah.
They were using Gilead and their hepatitis C treatments as their reasoning behind that, as the case that they felt illustrated that, because they said Gilead was seeing declining profits, which Gilead has, because it had cured its customer base. Let me remind you in that same period of time prevalence of hepatitis C rose… declining profits when your customer base is growing. Here’s the thing, they capitalism’d so hard, they screwed themselves over, because they didn’t cure THE customer base, they cared the customer base that could afford it.
And then failed to make a profit off of the large customer base that remain. That’s not… that’s a screw up, even by capitalism’s terms. Oh, and then they also got investigated by Congress for their initial pricing of Sofosbuvir and there was interest in whether public money was involved, huge outcry from various groups – basically everyone paying attention, etc. Yeah, it was not, it was not well handled. So one of the lines about this was essentially, well, it’s okay that they price that so hard because when competition comes on the market and other companies show up with other effective hepatitis C drugs, the price will go down and availability will go up.
Other drugs did come on the market, prices did go down, but absolute treatment refusals as reported by insurers to one of these extremely large online pharmacy entities actually went up for almost everything except for Medicaid. Medicaid went down by a tiny bit, but they’d been refusing enough people as it was. So as of 2017, one of these surveys actually found that 52% of patients on private insurers received absolute refusals to give them access to hepatitis C drugs. So that didn’t happen – prices going down did not increase its availability.
So where does your research come in particularly?
Um, so my research has been documenting the history of this particular drug and hepatitis C and highlighting the places where intellectual property policy and federal funding and how we do drug development all coincided to make it possible for Gilead to price this drug at such a level, and then have it be so unavailable to the majority of people who needed it. And then also to highlight the policy levers available to us to mitigate these situations in the future. So sort of, sort of gone over the history of the drug. And now I can talk a bit about our policy levers. And, okay, so I’ve got good news and bad news. The good news is we have highly effective policy levers, highly effective laws and policies that do allow us to take the sting out of drug pricing and make drugs more available. The bad news is, we’re not using them. And it is a matter of political will. And if you’ve been paying attention to what’s going on in Congress these days, that should make you sweat bullets.
There isn’t any.
Yeah. Uh, so, so let’s talk about those policy levers. In 1980, concerned about whether American industry was competitive with Japanese industry, Congress passed the Bayh–Dole Act. And basically, among other things, it made it easier for people who’ve gotten federal funding to hold patents on that material and receive royalties. But what we’re going to focus on here is, it outlined patent holder responsibilities to the federal government in return for that funding. And two of them were, you’ve got to say you got federal funding on your patent. And the other one was, if the invention is not being produced in such a way that meets the needs of the government, the government can come in and assign a license to a third party, to produce whatever your invention is in a way that meets its needs, whether that be like you’ve been sitting on this patent, or you develop a federal funding for like X number of years, we actually kind of need that thing. So we’re giving this to another company to produce to make sure we can actually get it and you can’t sue us for it. Because this is the agreement…
Which makes a certain amount of sense, since if they got federal funding in a way that US people helped pay for it, so therefore, they deserve to benefit from it in some respect or another.
Exactly. It’s been argued, hey, if this is so expensive, no one can afford it – that is not meeting the federal government’s need. This is not why we gave you the money in the first place. So that’s, that’s all and there’s been a certain amount of interest in whether it’s applicable to Sofosbuvir, because Sofosbuvir does not have federal money declared on its patent. But the congressional investigation into its history and its pricing did demonstrate they got a grant from the IRS of all places for about $244,000, which you know, by the standards of the pharmaceutical industry is fairly small potatoes, but if federal money has touched your patent at any point in its development, it is subject to Bayh-Dohl.
There had been some federal funding involved, but the other problem with Bayh-Dole is in the past, when it’s been invoked to increase the availability of a product rather than to deal with price, NIH has declined to invoke it in such a way that has made it almost impossible to ever invoke. And essentially, when there was a shortage of a particular drug badly needed for the treatment of a genetic disease, NIH declined to invoke … because nobody was going to be able to ramp up production and get FDA approval in a timely enough fashion to cause a serious difficult, uh, difference in availability of the drug. This makes it almost impossible to invoke because it would have required a company doing all the expensive legwork in order to bring a drug through the regulatory approval process without the promise of ever actually getting to sell it, companies are not going to do that.
So basically, because of that decision Bayh-Dole got rendered toothless. In order to use it, we need to go back, revisit that precedent and redo it basically. The other thing that actually is quite a bit more promising is a wait for cure drugs for at least federal programs is section 1498 of the US code, and this one is essentially something that says the federal government can infringe on patents, that is, you know, have them produced and sent in by them only if they pay quote, fair and reasonable recompense to the patent holder and this in the past has been used as a compulsory licensing law – that is, a law that allows the licensing of a patented invention without the patent holder’s permission, and it’s been heavily used by the military, because of course it has, for things like night vision goggles and so on. It basically lets the US government produce things off patent, as long as they pay a court determined royalty to the patent holder, which historically has been set at about 10% of the royalties. So you know, quite, quite reasonable. There’s been, there was a little hesitation about this.
But the thing is, it actually was heavily, heavily used in the 1950s-1960s. In the pharmaceutical realm, there was a little concern about like, Hey, we haven’t used this for pharmaceutical reasons, but actually, we have regularly and actually, in some cases, when a US drug company was willing to provide the drug to the government at a lower price or was willing to negotiate a lower price of the federal government has actually in the past, turned around and gone, hey, Italian company over there, let’s just reach an agreement to get this even cheaper, and Congress has historically declined to limit the powers of Section 1498. It just stopped being used in the 1970s or so – there’s just been no political will to use it.
There have been a lot of papers recently, specifically about hepatitis C published about the use of Section 1498, particularly by the porthole group at Harvard discussing how this could be a powerful tool if we actually did use it, which we have.
Well, then, is it… I mean, why?
I think… I’m not entirely sure why we stopped using it, but It should also be noted that as hepatitis C became this poster child of unavailable medication, the awareness really started coming to a head just as Trump got into office, and that administration has not historically been friendly to patient groups. So one of the major arguments against the whole compulsory licensing, hey, please stop holding people’s lives hostage for money, is like, but we need incentives in order to get drug companies to take the huge financial risks involved in developing drugs. And yes, developing drugs is just a horrendously expensive, risky procedure. This is true, but you look at Gilead’s profits in their first year or so of marketing their Hep C drugs, like they were north of the $20 billion mark, they spent $11 billion acquiring Pharmasset to start with and Pharmasset’s costs… their costs of getting Sofosbuvir like, all the way developed from beginning to FDA approval, we’re under a billion dollars. So like you make $20 billion on a $12 billion investment. And then you have declining profits, because you cured everyone who could afford it, even while prevalence went up. You’re not, you’re not mathing correctly, it would probably not just be good for the patients, but it will be good for you and your bottom line to not price things so highly. Like I cannot emphasize enough how this did not work out for Gilead.
I mean, that’s almost like basic economics, as you know, yeah. You sell to the lower price, but you make up more in volume, which it sounds like they would have.
Yeah, they spent, and in terms of the research expenditures, their research expenditures are dwarfed by their share buybacks, that is buying up their own stock to raise its value and make it, their stockholders happy.
Like this is not an effective economic model, and the issue of oh, developing the drug is so risky, and it costs so much is kind of facetious, because this is not evidently where this company’s financial priorities lie. And because of the skewed prioritization, they have seen their profits go down as the disease that their drug very effectively treats goes up in prevalence. You’ve got more patients than ever and you’re making less money.
Just… well, it’s then it, it gets sort of into, I think we can all broadly agree that in an abstract ethical sense, if not a practical consideration way, introducing a profit motive to healthcare is unethical.
And we did manage to make the system work before having a major profit motive. You look at the history of the development of penicillin, where you had a lot of the work done in publicly funded federally supported laboratories. They tried to do a bit of public-private partnership on that with bringing in Merck and Pfizer and so on to work on producing it and they just bounced around trying to make artificial penicillin, synthetic penicillin work. And then the folks at the federal laboratories not only managed to grow it in great quantities, but refined the process to the point where it could indeed be done in an industrial way. And then the private companies got to reap the benefits of this, but in such a way with such a guaranteed market, that it was quite cheap. We can make this work without the current model.
Yeah. Well, because it… it brings… a common argument in favor of capitalism in general, and in specifically when talking about drug development, is the idea that without it, and without sort of the underlying profit motive, a lot of innovation would be stifled. But do you think there’s potentially a scientific argument that in fact, prioritizing publicly funded and thus non profit motivated, but instead health needs motivated research can actually encourage better and more effective development?
That’s a really good question. And of course, when you look at science policy, you see a lot of instances where the government is correcting for quote, unquote, market failures, that is, things that would not be profitable to develop, but are nevertheless needed. And that’s where grants come in, it’s to basically give the market a little bit of a shelf where it wouldn’t, usually, so you’ve got kind of two levels of failure going on here. One of which is evidently, given the amount of money they’ve made off of selling hepatitis C treatments, how can I try to see drugs were not a market failure. And on the other side of things, you’ve got a situation where, hey, if we do have it all profit motivated, that means a batch of orphan diseases are not going to get the attention they need, and the drugs will not be as available.
So I mean, even with the example of penicillin, where publicly funded laboratories did a lot of the legwork, the private entities did do a certain amount for the distribution, natural manufacturer, and were quite useful without being in the way… I think the way I put it is basically we need a model where the private entities get a little profit as a treat, not as like the default of how this works.
And that… I don’t know if switching fully over to a publicly funded model would be effective, because I am currently unaware of any systems that actually have done that. But we got to regulate the stuff and we got to use the existing policy tools we have to hold these private entities to their existing obligations on the contracts they signed when they got public money. And we also need to have regulations that discourage this kind of behavior, where the company prices something extremely high, highly screws over the patient, screws over the providers, screws over the payers and screws over themselves.
Yeah. Well, and it’s also it’s, it’s just harrowing, because it’s… because I think from a certain perspective, you could look at this whole situation and say, well, the private businesses here just made sort of a miscalculation, and they ended up failing and whatever. But the problem is that they aren’t just like losing money on, I don’t know, luxury boats or something. They’re losing money on something that simultaneously is people’s lives.
Yeah. And in this circumstance, these failures are incredibly stark, and they’re so high stakes. And this is where confronting these problems really needs to start. I mean, one of the other things is, recently, the first million dollar drug just launched.
What was it?
I heard it was it, it’s not technically a drug, it’s a gene therapy.
And then the justification there is that you only need it once but the problem is like, who has a million dollars?
You need it once in infancy, because it’s for a particular disease that tends to kill the kid before, what, like age five? I’m just double checking, but it’s Novartis’s and I am not pronouncing this correctly, because no matter how sure you are about pronouncing the drug name correctly, you’re pronouncing it incorrectly – it’s Novartis’s Zolgensma, which is for, yeah, a particular, particular drug for a particular genetic disease that’s quite appalling. The kids are usually under like three years old, and right now the, it’s mostly, um, available through lottery. Oh, and I was incorrect it’s actually two point million dollars in the US.
Infants are not eligible for it after turning two. So this problem is not going to get better without regulation. And clearly, I mean, clearly these companies cannot be trusted to regulate themselves at this juncture.
We like to end our interviews, asking our guests to weigh in on one or several of our recurring themes. So if you found yourself in a post apocalyptic environment, we typically go climate catastrophe because that feels like… we’re just gonna live through that, what do you think you would be doing?
So I wanted to like wind up with a goat farm and a queer commune, like up up some mountain somewhere because goats are really super hearty. And I’ve like again, grew up surrounded by botanists, so I have a decent amount of Oh, this is how you grow stuff experience. And just like get all my friends together and go hide up a mountain somewhere with goats and little sustainable farm kind of thing going on.
I think my theory Yeah.
I mean, I do we all love goats, obviously. Um, do you have any experience with goats?
I do not have specific experience with goats, no.
You could probably find some queer people who know goats, though.
Put a call out to our podcast listeners. Do you know goats? If so…
I, go to Santa Barbara when everything falls apart, find Theo, goat time.
Initially, it was actually thanking Northern Arizona for the goat farm. Because, yeah, I mean, it’s it, there’s actually a fair patch of moisture up there, so…
Comparatively, because like, actually, Central California does not get reliable enough rain. I wanted to get further from population centers, because we all know from post apocalyptic tech movies, our major problem is less like the environment and more other people.
Yeah. Although I will say I mean, yes. But also, the sort of whole history of humankind also teaches us that, like, to survive, you really need a community.
So you, you got to find the right people.
Exactly. So you know…
And the right people, yeah, well, the right people in this case are people who know goats.
Yeah, I mean, I was I was also kind of thinking about, you know, asking the two of you and…
I mean, I grew up on a farm. Wasn’t goats, but I grew up on a farm. My wife is trained as a veterinarian, you know, I’ve got stuff to bring to this table.
Well, I know, insects so I could be sort of the, you know, I could team up with Tessa’s wife and we could have a veterinary entomology kind of situation going on.
Yeah, and I mean, your, your cricket skills are going to come in useful.
Exactly, my plan to have a cricket farm.
Exactly. Cheap, you know, source of protein.
Cheap source of protein, goats… I wonder if goats would eat crickets.
Goats eat almost anything.
My, my parents could come to because they’re the ones with a vast quantities of horticultural knowledge.
Well, I… not to be, I mean, not to be morbid about it. But um, I mean, for their sake, I hope they have passed peacefully by this point. You know what I mean?
Very true. I think… I think they would not disagree.
Theo, if people want to find out more about you, where should they look?
I’m actually being kind of a cryptid right now. So I don’t have a research persona to promo I’m afraid.
So, well, just don’t look for Theo, live your life. Just go on with your life. And if people want to find me, I’m on Twitter @cockroacharles.
And I am on Twitter @spacermase.
The show is on Twitter @ASABpod and at our website where we post show notes and transcripts for every episode, asabpodcast.com
And until next time, keep on science-ing.