Book Review: For Business Journalists, 'The $800 Million Pill' is Worth Swallowing

By Bill Barnhart

John LeCarre's novel, "The Constant Gardener," is a chilling attack on the pharmaceutical industry. Merrill Goozner, a former Chicago Tribune reporter, is no John LeCarre.

But his analysis of Big Pharma belongs on the shelf of any business reporter who covers health care or dreams of putting his or her curiosity about any business between book covers.

"The $800 Million Pill" is not a piece of gotcha journalism. Nor is it a neutral chronology of the drug industry. In between those extremes, Goozner lays out a series of episodes to expose the standard operating procedures of a business that the public believes to be about saving lives, but actually is about business.

Set aside the life-and-death issues involved in research on HIV, cancer, tuberculosis and lesser-known ailments. Set aside his principal conclusions: Taxpayers should not have to pay twice for drugs that owe their genesis to publicly funded laboratories; consumers should not be gouged for me-too drugs holding trivial patents.

Beyond the unique context of the drug industry, Goozner has attempted what every business beat reporter should set as a goal. He has attained and conveyed a comprehensive understanding of an industry, and thereby established his credibility to make a difference.

Some reviewers dismissed Goozner's effort as a naﶥ, overwrought statement of the obvious: The drug business seeks to maximize profits and stock prices. That's an inadequate critique. Business journalism took a turn for the worse when P/E ratios became more important than the pathologies of organizations.

Reporters who manage to get past stock prices and gee-whiz coverage of new products can find compelling stories. Goozner's analysis of drug innovation at Abbott Laboratories, amid overarching dramas in the company's executive suite, demonstrates his objective. Consider Ferid Murad, who won the Nobel Prize for medicine in 1998 after working for Abbott in the late 1980s:

"It didn't take long for Murad to bump into the glass walls of the corporate fishbowl he had jumped into. Within months of his arrival, Schuler, the man who had brought him to Abbott, was gone and the company was wracked by high-level intrigue among a board of directors intent on ousting" chief executive officer Robert A. Schoellhorn.

Reporters who covered Abbott at the time probably knew little of the internal dynamics that affected drug research at the company. That's why reporters should take the time to write books. Having done so, Goozner has plowed the ground for the next reporter assigned to Abbott and the drug industry.

Like many workmanlike reporters, Goozner suffers from the urge to empty his notebook. His history of cancer research takes him far afield from the book's central themes. But the concluding chapters are worth the slog. The misfeasance of the drug industry becomes clear.

To grasp the nature of the industry's dubious rationale for high drug prices, imagine the makers of Miller Lite beer obtaining a patent on the phrase, "tastes great; less filling," and then collecting premium prices as a result.

As drugs lose their patent protection and face steep generic price discounts, the makers patent a formula or molecule that is little more than a new marketing message, with no improvement in effectiveness. The me-too drug is advertised as new and improved, deserving a high price.

Goozner recommends that government regulators become more vigilant against granting patents to me-too products, as well as naturally occurring substances and processes. Why should anyone collect a toll for providing under patent protection what nature has already created?

It's a reminder that reporters covering numerous industries would do well to delve into the arcane process of patent awards. Health care journalists with more entrepreneurial instincts, in particular, could develop an Internet site called Me-too.com, which exposes the shortcomings of new drugs. An aging population, increasingly on guard against rip-offs, constitutes a ready-made audience for this work.

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Copyright © 2008 Donald W. Reynolds National Center for Business Journalism