Pharma sector a ‘market for lemons’
pharmafile | August 20, 2010 | News story | Sales and Marketing | NICE, health economics
American sociologist Donald Light has made a provocative assessment of the pharma industry, saying the industry is able to exaggerate the benefits of products and downplay their side-effects.
Borrowing a well-known expression from economist George Akerlof, this situation makes the pharma sector a ‘market for lemons’ – where bad products are hard to tell apart from good ones.
Light, a professor of comparative health policy at the University of Medicine and Dentistry in New Jersey, was speaking at the 105th Annual Meeting of the American Sociological Association.
“Sometimes drug companies hide or downplay information about serious side effects of new drugs and overstate the drugs’ benefits, says Light in his paper ‘Pharmaceuticals: A Two-Tier Market for Producing ‘Lemons’ and Serious Harm’:
“Then, they spend two to three times more on marketing than on research to persuade doctors to prescribe these new drugs. Doctors may get misleading information and then misinform patients about the risks of a new drug. It’s really a two-tier market for lemons.”
Light says because companies oversee testing of their own drugs behind “firewalls of legal protection,” their pros and cons can be hidden.
A relatively “low bar” set for drug efficacy to be approved also meant that minor updates to older drugs were approved, hindering genuine innovation, he says.
Light based his conclusions on data from independent sources and studies, including the Canadian Patented Medicine Prices Review Board, the FDA and Prescrire International, a French journal that publishes research on pharmacology, toxicology and pharmaceutics.
He says independent reviewers found that about 85% of new drugs offer “few if any new benefits.” He added that that “toxic side effects or misuse” of prescription drugs now make them a “significant cause of death” in the US.
Light concluded: “A few basic changes could improve the quality of trials and evidence about the real risks and benefits of new drugs. We could also increase the percentage of new drugs that are really better for patients.”
UK industry body the ABPI responded by saying Prof Light’s comments were “long on accusation and woefully short on hard evidence”.
A spokeswoman for the ABPI added: Millions of people are alive today thanks to medicines and have transformed the management of conditions which previously caused death, impaired the quality of life or required hospitalisation.”
She added that there is greater transparency in clinical trial results, thanks to publically accessible websites such as www.clinicaltrials.gov.
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