1/7/16 Show feat. Gloria Tavera on Pharmaceutical R&D, Drug Pricing, and How to Fix the System

From an infographic by Chase Perfect on the HepC drug price hike.
The featured image is from Hepatitis C Infographic by Chase Perfect on the price hike of the drug.
Scroll to the bottom of the page to listen to the interview-only version.

tavera_gloriaIn my second interview with Gloria Tavera, MD/PhD student at Case Western Reserve University in Cleveland, we dig deep in to drugs. (Click here to listen to my first interview with Gloria on malaria immunology and access to medicines.)

First, Gloria takes us through the research and development process – the timeline and the costs. That brought us to drug pricing and the role of the pharmaceutical industry. You bet we discuss Martin Shkreli and his company’s price hike of the drug Daraprim from $13.50 to $750. Gloria explains what Daraprim is and how this kind of price hike is not only possible, but totally legal. It all has to do with drug patenting, which we discuss a bit, especially in reference to something called “evergreening” (aka “me too” drugs) – a technique used my drug companies to extend their exclusive patent past the 20 year mark.

In the final part of the interview, Gloria walks us through how this structure could be changed to obtain a better, more efficient pharmaceutical system that works for the public rather than the drug company share-holders. She discusses how the incentive structure needs to change, using a “push, pull, pool” mechanism.

In the show I quoted two articles that do an excellent job explaining these topics:

(1) LA Times op-ed on Big Pharma’s pricing drugs.

Big Pharma, while of course contributing to innovation, has increasingly decommitted itself from the high-risk side of research and development, often letting small biotech companies and the NIH do most of the hard work. Indeed, roughly 75% of so-called new molecular entities with priority rating (the most innovative drugs) trace their existence to NIH funding, while companies spend more on “me too” drugs (slight variations of existing ones.)

But if Big Pharma is not committed to research, what is it doing? First, it is well known that Big Pharma spends more on marketing than on R&D. Less well known is how much it also spends on making its shareholders rich. Pharmaceutical companies, which have become increasingly “financialized,” distribute profits to shareholders through dividends and share buybacks designed to boost stock prices and executive pay.

(2) Vox article explaining the news around Martin Shkreli, the pharmaceutical head recently arrested for securities fraud – though that’s not why the public hate the guy. I guess he’s also an a-hole on Twitter and bought some singular copy of a Wu-Tang album, but we have other beef.

But really the hatred for Shkreli comes from how unapologetic he was about the price increase [of Daraprim by 5,500 percent]. Other companies have pursued similar pricing strategies without stoking so much backlash.

As Forbes’s Matthew Herper wrote, “Questcor Pharmaceuticals raised the price of its drug, Acthar Gel, from $40 to $28,000 a vial. The reward? It was one of the best-performing stocks in America until Mallinckrodt bought it for $5.6 billion last year. Valeant Pharmaceuticals has done big price increases on numerous drugs. The stock’s up 740% over five years and its founder, Michael Pearson, is a billionaire. Only Shkreli has drawn the American public’s rage.”


Additionally, we touched on the history of the drug industry. Below is just a snippet from an excellent infographic that takes you through the key events in the 80’s that created the system we have in place today.

Screen Shot 2016-01-07 at 7.28.05 AM


And of course there was music.


Artist Song Album Label
Shilpa Ray Shilpa Ray on Broadway Last Year’s Savage Northern Sky
Intro to the show
Fatoumata Diawara Alama Fatou World Circuit Limited
Neutral Milk Hotel Holland 1945 In An Aeroplane Over the Sea Domino Recording
Bob Dylan Stuck inside of Mobile with the Memphis Blues Again The Cutting Edge Sampler, 1965-1966 (Bootleg Series Vol. 12) Columbia/Legacy
Shye Ben Tzur, Jonny Greenwood Roked Junun ATC Management
Interview with Gloria Tavera, Pt 1 Drug Research and Development Process
Dan Auerbach Trouble Weighs a Ton Keep it Hid Nonesuch Records
Beat Happening Red Head Walking Look Around Domino Recording
The Beverleys Visions Brutal Buzz Records
Interview with Gloria Tavera, Pt 2 Drug costs, the pharmaceutical industry, and patents
Abner Jay I’m So Depressed One Man Band Subliminal Sounds
The Sadies Hold on, Hold on In Concert Volume 1 Yep Roc
Beach Slang Hard Luck Kid The Things We Do To Find People Who Feel Like Us Polyvinyl
Palehound Molly Dry Food Exploding in Sound
Interview with Gloria Tavera, Pt 3 How to fix it.
Adult Mom Survival Momentary Lapse of Happily Tiny Engines


Just want to listen to the interview? Don’t have time for the music? Here ya go.

One thought on “1/7/16 Show feat. Gloria Tavera on Pharmaceutical R&D, Drug Pricing, and How to Fix the System

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