Posted on March 3, 2014 at 10:29 PM
One focus in HOOKED is the need to appreciate the history of the pharmaceutical industry in the 20th century, to trace today’s developments to their origins. In a similar historical vein, I’ve called attention in this blog to the belief system I like to call “economism”:
–though I am increasingly outnumbered by historians and social scientists who prefer the label neoliberalism.
Economism/neoliberalism (E/N) is an ideology generally characterized as faith in the unregulated free market along with demands for tax cuts and corporate-friendly government policies. However, as economist Philip Mirowski (Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown, Verso, 2013) insists, such a description misses one of the key elements of E/N. Originating with Austrian economist Friedrich Hayek, a founder of E/N during the 1940s, is the idea that the market serves not merely as a medium for the exchange of goods and services, but as a perfect information processing system. The price of a commodity in the truly “free” market reflects at any given time the sum of millions of exchanges across the world, and reflects what any commodity is “worth” much more accurately than any alternative way of approaching the problem–such as scientific research, for example. In short, the market is omniscient; in short, the market is God. The fact that no real-life market ever did or ever could function in this manner does not seem to bother any committed believer in E/N–tending to confirm my claim, in The Golden Calf, that E/N pretends to be hard-headed economic science but actually functions logically like a quasi-religion.
By now you are wondering (if you’re still awake) what any of this has to do with Pharma. I was moved to address this topic by a recent article (subscription required) by economist Edward Nik-Khah on how a major E/N enterprise, the Chicago School of Economics, played a critical role in the creation of a new E/N think tank, the Center for the Study of Drug Development, initially located at the University of Rochester and later moved to Tufts University. A key figure described by Nik-Khan in this process was the famous clinical pharmacologist, Louis Lasagna (1923-2003).
In his early career Lasagna was a widely respected academic, often credited with originating the field of clinical pharmacology. Like most of his academic fellows he strongly supported the efforts of the FDA to rein in drug-industry advertising and replace misleading marketing with solid science. He was initially a supporter of the Kefauver-Harris amendments of 1962 that strengthened the FDA’s regulatory powers. But through the 1970s something changed. Lasagna cast the sole vote on a review committee of the National Academy of Science in favor of Upjohn and its drug Panalba, that the FDA was trying to take off the market as ineffective. Lasagna took his losing case to the public through an editorial in the Wall Street Journal. Eventually he became the co-founder of the CSDD at his home university, Rochester. The CSDD became a supposedly independent unit to study the science and economics of drug development, but was in actuality captive to the drug industry that funded it. Its most notorious product was the estimate of “the $800 Million Pill,” the widely-criticized (but also widely believed) figure of how much the industry must spend in research to create a single successful new drug (discussed at length in HOOKED).
Nik-Khah never documents precisely how Lasagna was “turned” from a position in keeping with academic clinical pharmacology to a stance at odds with virtually all his fellow academics. But he does show that Lasagna attended a conference sponsored by the Chicago School of Economics in 1972, organized and attended by such E/N figures as Milton Friedman and George Stigler, which became a one-sided mouthpiece for promulgating E/N doctrine in opposition to government regulation of the drug industry. (One of the key Chicago staffers later argued that weakening drug regulation would still be worth it economically even if it produced several thalidomide tragedies, because of the greater benefits of allowing more wonderful new drugs to reach the market quicker.)
Following Lasagna’s attendance at the Chicago conference and his WSJ piece, the chancellor at Rochester, Allen Wallis, who traveled in the highest E/N circles of that day, took Lasagna under his wing and suggested the creation of the CSDD, personally interceding with drug companies and pro-business foundations to fund it. (Following good free market principles, Tufts eventually stole the CSDD away from Rochester by offering more money, in an effort to build its own drug-industry-funding portfolio.)
Nik-Khah illustrated how Lasagna had signed on to the E/N agenda by quoting extensively from some of his later writing on deregulation of the drug industry. Lasagna eventually turned against academic science almost totally. He argued instead that the minimal amount of clinical trial research should be required to get a drug onto the market, and thereafter the company should be responsible for monitoring how the drug performed as to safety. He viewed the ideal state of affairs as the physician and patient being bombarded with information from numerous sources, including industry marketing, and then making up their own minds as to using the drug. The clash of multiple, conflicting information sources would work much better than any scientific study as a way to find out the truth about the drug. If patients complained that they were ill-equipped to sort through such detailed, technical data, Lasagna replied–tough, this is the real world, live with it. In short, Lasagna spoke like a true convert to E/N, believing that the “free market” of ideas was far superior to, and much more reliable than, scientific research.
Another telling quote from Lasagna’s writing during this time is what he called the supposed censorship imposed on industry by overweening FDA regulations, according to his view–he deemed it “Lysenkoism,” comparing the FDA with the Stalinist suppression of Mendelian genetics in the USSR. Daniel Stedman Jones’s political history of E/N (Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics, Princeton, 2012) points out that the major founders of E/N, Hayek and Friedman, shared a conviction that all “collectivism” was cut from the same cloth, whether it be Hitler’s Germany, Stalin’s Russia, the New Deal, Britain’s welfare state, or even a labor union. A doctrinaire anti-communism all during the Cold War characterized their public utterances. By invoking a Stalinist bogeyman, Lasagna indicated that he was singing straight out of the E/N hymnal.
Nik-Khah’s work seems a useful historical exploration of how many of the pro-Pharma policies and politics that emerged in the US in the later decades of the 20th century can be traced directly to the influence of the E/N ideology, and how the echo chamber of E/N institutions helped to spread the word. (Hat tip to my colleague Daniel Goldberg for recommending this article.)
Nik-Khah E. Neoliberal pharmaceutical science and the Chicago School of Economics. Social Studies of Science, 2014, e-published ahead of print
Addendum 4/13/14: By coincidence, I have recently finished reading Dominique Tobbell’s book, Pills, Power, and Policy: The Struggle for Drug Reform in Cold War America and Its Consequences (University of California Press/Millbank Books, 2011). Historian Tobbell paints quite a different picture of how Louis Lasagna did a 180 on the FDA. According to her account, Lasagna’s conversion was much more gradual, was based at least in part on a reasoned assessment of how the FDA appeared to be overreaching in its responses to the 1962 post-thalidomide Congressional amendments, and was already largely completed by the time he was first exposed to a strong dose of E/N. So before one buys into Nik-Khah’s account, it’s only fair to mention this alternative assessment.