Expensive new drugs - do we really need them?

Editor, – Professor Moulds' editorial (Aust Prescr 2004;27:136-7) suggests that in the last 20 years, new prescription medicines have failed to provide the same therapeutic advances as in the previous 20 years, but are costing significantly more. Furthermore, Professor Moulds believes that patent protection for profiteering pharmaceutical manufacturers is denying the community access to cheaper generic medicines. I would like to dispute the professor on a number of issues.

First, data from the Australian Institute of Health and Welfare show that in the last 20 years, mortality rates have decreased for cardiovascular disease (48%), respiratory disease (33%), and digestive disorders (35%). Medicines have saved more lives in the last 20 years, however morbidity rates have inversely increased.

Secondly, it now costs over $1 billion for a pharmaceutical company to develop a single new medicine.¹ This is quadruple the cost of 20 years ago. If an innovator cannot recoup these development costs, they have less discretionary resources to devote to the development of better and more efficacious medicines.

Finally, Australian patent law does not preclude a generic manufacturer from selling a copy of a drug with an expired patent, even if the innovator company advances the development in some way. Nor does Australian patent law allow innovators to make trivial patent applications. 'Evergreening' simply does not exist in Australia and never has.

There is a myth in Australia that generic medicines are cheaper. In reality, generics are cheaper for the government to purchase, but the cost savings have not been passed onto the Australian consumer. Ironically, the government increased the co-payment of Pharmaceutical Benefits Scheme (PBS) items in January 2005 by 21% to make headroom for new and expensive medicines on the PBS.

If we want more effective medicines, we should be encouraging innovation from manufacturers rather than accusing them of being greedy for wanting a return on their investment. The result is that patients who may benefit from a newer and more efficacious medicine will miss out.

Brendan Grabau
Managing Director, Brendan J. Grabau & Associates Pty Ltd
Consultant pharmacologists
Eltham North, Vic.

Professor R.F.W. Moulds, author of the editorial, comments:

The main point of my editorial was that new drugs introduced over the last 20 (or so) years have not had the same impact on the practice of medicine as those introduced in the preceding 20 years. The figures quoted by Dr Grabau do not negate the argument. A reduction in mortality from cardiovascular, respiratory and digestive disorders would far more likely reflect the effect of drugs introduced in the preceding 20 years rather than the effect of drugs only introduced in the last 20 years. Regardless of when the drugs were introduced, other factors, such as decreased smoking, may have contributed more to the reduction.

If this argument is correct, then clearly the patent system has not achieved its aim of stimulating the development of important new drugs, so it should be reviewed. The other issues raised by Dr Grabau would presumably be considered in such a review.