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TRENDSPOTTER: A Senate Proposal that s Bad Medicine for Genomics

“PRESUME you were an idiot. Now presume you were a member of Congress. But I repeat myself.” So wrote Mark Twain after trying to extend intellectual property laws to authors. Twain would have a field day with the current crop in Congress and their efforts to undermine medical progress all in the name of “consumer protection.”

As almost everyone knows, extending prescription drug coverage to seniors citizens is an important part of the political agenda. There are any number of ways to achieve this worthy goal. The problem is, rather than focus on the immediate challenge, politicians are more interested in beating up on pharmaceutical and biotechnology companies for the sin of wanting to turn a profit in the process of coming up with the drugs and treatments for the diseases that make health care so expensive in the first place.

So, as a way of solving the problem of lack of prescription drug coverage, certain members of Congress – namely Senators Paul Wellstone (D-Minn.) and Ron Wyden (D-Ore. ) in particular – have come up with an approach that has nothing to do with helping seniors and everything to do with hurting medical innovation: They want any biotech or drug company that uses NIH money or research in any way, shape, or form to either pay back the money it uses or subject the product developed with NIH research or support to government price controls. This would be on top the regular royalties companies now pay when they license a technology!

Such proposals will do nothing to help seniors get prescription drugs. They will make it hard for genomics companies to continue working with government scientists and will insure that any NIH genomics work will be wasted and go unused. Who will license NIH-supported genomics work or use NIH patents knowing that a price control or some outrageous payback lies ahead? Either Senators Wyden and Wellstone are so blinded by their hatred of capitalism not to care or they are too ignorant or lazy to find out.

All they would have to do is get one of their interns to hit the web and find out what happened to NIH-sponsored research when price controls were applied less then 15 years ago. They would have discovered that Congress had imposed a price control clause on all private company products developed with NIH research support in 1989.   They would have found that the clause had a chilling effect on industry and resulted in the mainstream biotechnology and pharmaceutical industries largely avoiding or passing over NIH licensing and collaborative opportunities.

At that time, NIH held key patents covering first-generation antisense oligonucleotide technologies, including phosphorothioate oligonucleotides and triple-helix forming oligonucleotides. These ideas never developed into products due to lack of private sector funding and key enabling technologies. From 1989 to 1994 the number of collaborations and licenses with NIH and companies declined from about 60 to a low of 35 in 1994, the last year the price control was in place. During that time, many of the licenses and CRADAs executed involved small biotechnology companies for whom undefined product pricing restrictions were of little immediate concern. For example, over 200 (85 percent) recently-initiated federal CRADAs in biomedical areas have been outside of PHS/NIH. While NIH concluded fewer than 35 biomedical-related CRADAs in fiscal year 1994, the Department of Energy initiated over 60 and the Army initiated about 65.

Once the price control clause was eliminated, the number of exclusive collaborations began to soar. And of course, the genomics community has been instrumental in creating a vibrant exchange of ideas and initiatives between the NIH and private companies. Such collaborations are critical to the future of a new, targeted approach to drug development as well as to a more complete understanding of disease at the molecular level.

But the Wydens and Wellstones of the world seem hell-bent on destroying the collaborative nature of medical progress because – heaven forbid – private companies actually benefit from federal research activities. Since when did the NIH mission turn into some sort of student loan program? The fact is, the commercialization of genomic information is the key to medical progress and improving human health in the 21 st century. Genomics will survive without open access to NIH research, activities, and patents, but the going will be slower and the investment Americans have made in NIH and in its research community will be wasted. Worse, the cost of drug development will go up as the search for knowledge becomes more expensive.  

Then again, the enemies of medical progress such as Wyden and Wellstone truly believe that the way to make people healthy is to simply spend more money on the older technologies at hand. In the final analysis, they think all the breakthroughs are there simply for the companies to rake in profits, not to help people. Too bad genomics companies can’t identify the sequence that causes that sort of convoluted thinking.

Robert Goldberg is a senior fellow at the National Center for Policy Analysis and a senior research fellow at the Ethics and Public Policy Center. You can e-mail him at [email protected]

TrendSpotter is a weekly column that focuses on how trends in politics, patent law, and the US and European markets affect the genomics industry. The column appears every Friday. For access to previous columns, enter “Trendspotter” in the archive search at the top right of the home page.
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