Copyright 2000 The Houston Chronicle Publishing Company
The Houston Chronicle
January 16, 2000, Sunday 2 STAR EDITION
SECTION: OUTLOOK; Pg. 2
LENGTH: 839 words
HEADLINE:
Higher drug costs in reality not a bad sign
BYLINE: GEORGE F. WILL; Will is a Pulitzer
Prize-winning syndicated columnist, based in Washington, D.C.
BODY:
ONE reason - perhaps a sufficient reason;
certainly a matter of life and death - for hoping Bill Bradley defeats Al Gore
is an accusation Gore makes about Bradley. Gore says that when he, Sen. Gore,
"was fighting for the consumers," Sen. Bradley aided the pharmaceutical
industry, for example by favoring extensions for some
pharmaceutical companies' patents.
Gore deplores this
because patents, which give innovating companies a period
without competition from generic versions of drugs they
develop, provide temporary protection from downward pressure on
drug prices. But it is demagogic, myopic and false for Gore to
say that consumers' interests are served by whatever reduces consumers'
drug expenditures. Besides, limiting drug
expenditures would increase the nation's overall medical expenses.
The
surest way to restrain the growth of spending on drugs is to
restrain the growth of medicine's pharmacological options. A certain way of
doing that is by squeezing drug companies' profits, which must
fund the huge costs of research. A certain way to squeeze profits is with price
controls, for which Gore is paving the way with his crude consumerism.
There he goes again. Gore supported Hillary Rodham Clinton's health-care
plan to limit increases in medical expenditures by shrinking and dumbing down
medicine. She favored cutting the number of doctors: fewer doctors - "cost
centers," she thought of them - would mean fewer doctor bills. And she favored
cutting the number of specialists: With their sophisticated diagnostic and
therapeutic techniques, specialists are expensive. (Her plan would have been
cyanide for New York City's 62 teaching hospitals.)
Medicare is heading
for insolvency, and for enlargement, as political pressure grows for
prescription drug coverage. About 13 million American seniors -
one in three - have no such coverage. These are low-income people - but not the
poorest, who have Medicaid. Total drug expenditures by the
elderly (not drug prices) are increasing 15 percent a year.
However, an even faster rate of increase might mean a slower growth of
health-care spending overall. This is because drugs
increasingly can prevent or improve treatment of diseases, sometimes obviating
the need for surgery or hospitalization. And the velocity of
drug development is about to accelerate dramatically.
Probably not until around 1910 did the average visit to a doctor do more
good than harm.
Since the middle of the 20th century, pharmacology -
antibiotics, the polio vaccine, etc. - has made Americans think of themselves as
the first beneficiaries of truly modern medicine. Actually, we are at the end of
the era of pre-modern medicine.
As drugs developed by
the intensely competitive pharmaceutical industry become more capable, prices
may decline, as has been the case in the computer industry.
Even so,
aggregate drug expenditures may rise. Indeed, we should hope
they do.
This is so because biology and genetics - especially the
fast-unfolding Human Genome Project - are going to revolutionize
drug development.
Understanding the biological and
genetic mechanisms of, say, Alzheimer's (which costs upward of $ 90 billion a
year for doctors, drugs and care) or breast cancer will lead to
drug treatments that may be expensive but also cheaper than
today's limited responses to those afflictions.
It is a fatal conceit
for government to think it can know how much Americans will be willing to spend
on drugs after 10 more years of exponential growth in
pharmacological prowess. Willing? They will be eager: Wait until baby boomers
meet arthritis. And infectious diseases can mutate in response to
drugs, so the creative dynamic cannot end.
Many Western
nations' pharmaceutical policies are akin to their defense policies - they are
hitching a ride on American enterprise. Nevertheless, when pharmaceutical costs
are measured in terms of "purchasing power parity" in various countries,
Americans spend less per capita on pharmaceuticals than do the French or Germans
and just slightly more than Canadians.
When government responds, as
surely it will and arguably should, to the desire for Medicare coverage of
prescription drugs, it will be the dominant purchaser of
drugs.
It will want to use its monopsonistic power (the
power of a single dominant buyer) to pressure pharmaceutical companies into
price controls. Gore already seems ready to sacrifice long-term health benefits
for the short-term political benefit of government drug
pricing.
Bradley's mild senatorial support for the pharmaceutical
industry may have been mere parochialism: The industry is New Jersey's largest
employer. He opposed ethanol subsidies until he fell in love with Iowa,
whereupon he said he had opposed ethanol because it was unimportant to New
Jersey.
Still, Bradley seems less likely than Gore to injure the
industry that is poised for exponential increases in its ability to reduce pain,
extend and enhance life and reduce the rate of growth of health-care
expenditures.
TYPE:
Editorial Opinion
LOAD-DATE: January 17, 2000
