Warren ignores the primary driver of drug innovation

Sen. Elizabeth Warren (D-Mass.) and others mistakenly believe that pharmaceutical innovation is primarily driven by the National Institutes of Health, the federal medical research organization. But that’s never been true. 

A study in the journal Health Affairs by two Columbia University scholars uses mounds of historical data to reveal the real role the NIH serves in drug development.

{mosads}This study shows that fewer than 10 percent of drugs are covered by a public sector patent. And this slice of drugs only accounts for 2.5 percent of total annual drugs sales. Drugs that relied on federal funds for development, meanwhile, comprise only about a quarter of sales.

The NIH plays a vital role in basic research and early discovery, but is robbing Productive Peter to pay Government Paul the best bang for the buck when it comes to advancing public health? 

The answer is a clear “no.” The primary engine of drug innovation is private industry, which spends in excess of $50 billion annually on research and development.

The NIH focuses on basic research — that is, the study of fundamental aspects of organic phenomena without regard to specific medical applications. The biopharmaceutical industry, on the other hands, directs most of its R&D toward clinical research. Private science is centered on the actual development of new medicines.

Both the NIH and private firms provide research financing to academic institutions. But it is industry that employs most of the scientists that conduct the hands-on development work.

Unfortunately, some lawmakers have bought the myth that the NIH is primarily responsible for new medicines. Senator Warren for instance, has drafted legislation, deviously called the “Medical Innovation Act,” that would strap the private sector with a big new fee.

Such a move would have a chilling effect on future investments in R&D. Drug firms would be sapped of precious capital. The rate of medical innovation would drop considerably. The result would be fewer treatments and cures for patients all over the world. And industry growth would grind to a halt, meaning lost jobs and a sluggish economy.

Warren is understandably wary of outright claims that the drug industry needs to be subjected to heavy new taxes. The pervasive myth that their work is mostly a function of the NIH provides her with useful political cover.

Alas, headlines for hyped and misleading “NIH-funded cures” are far sexier than those for “more money for drug regulation.” Pursuing misguided policies that siphon funding from the groundbreaking medical research happening in the biopharmaceutical industry will have devastating consequences for patients and society. The proposed legislation would result in fewer medicines for patients and lost jobs at a time when our economy can least afford it. Senator Warren and others should pay heed to the facts and avoid the fiction. They are inversely important to advancing 21st-century healthcare. 

Pitts, a former FDA associate commissioner, is president of the Center for Medicine in the Public Interest.