Some products are so critical to life and living that their absence would cause tremendous harm to society. One such line of products are pharmaceutical medications aimed at combating the diseases that fall predominantly on the poor.
Oxfam â€“ a non-governmental organisation dedicated to â€œfinding lasting solutions to poverty and injusticeâ€ â€“ has released a report, â€œInvesting for Lifeâ€ in which they claim to have identified the source of injustice and illness amongst the worldâ€™s poor. It is the worldâ€™s large pharmaceutical firms.
Oxfam claims that, by enforcing their intellectual property rights and charging high prices for their products, Big Pharma is undermining everyoneâ€™s universal â€œrightâ€ to health.
Error of logic # 1: Forcing businesses to give away their IP for expensive R&D is a great way to encourage them to do research
“The industryâ€™s responses to flagging financial performance â€“ hiking up prices, aggressively defending patents and prolonging existing ones through â€˜ever-greeningâ€™ rather than investing in research and development of new medicines â€“ have undermined needs for lower prices, flexible approaches to patenting, and R&D investment into diseases relevant to the developing world,” states Oxfam.
There is a contradiction: Oxfam demands that businesses spend investors’ money (usually from pension funds and the like) on searching for cures to diseases for which – should they find a cure – they must then give away and choose not to earn money from their research. In other words, Oxfam demands that those research companies with ability should be the slaves of those who are unable to help themselves.
Thailand and Brazil, two medium-income countries, have chosen to issue compulsory licenses for a range of drugs (including Merckâ€™s Efavirenz anti-retroviral HIV drug). These are hardly poor countries and their governmentâ€™s can certainly afford the medication.
In the short-term the poor may very well receive treatment for HIV. Generics firms will gain from avoiding othersâ€™ patents. In the long-term pharmaceutical firms have no incentive whatsoever to conduct research into other diseases that afflict the poor. AIDS is not the end of disease.
Companies which don’t look to staying profitable tend to go bankrupt. If pharmaceuticals firms are not to improve their profitability then they will never be able to produce anything, let alone cutting-edge new drugs.
Error of logic # 2: When a business identifies a problem and sells the solution to that problem, should they be treated as if they caused that problem?
“The industryâ€™s failure to comprehend access to medicines as a fundamental human right enshrined in international law, and to recognise that pharmaceutical companies have responsibilities in this context, has prevented the adoption of appropriate strategies,” states Oxfam.
Pharmaceuticals companies do not cause people to get sick. Their products can, however, cause people to get well. It is fair comment to demand that those who are responsible for causing an illness take responsibility for fixing the ill they cause, it is quite another matter to demand of a company making a product to fix the illness they did not cause to be held responsible for causing that illness.
Pharmaceuticals companies profit from peopleâ€™s illness the way motor companies profit from peopleâ€™s inability to run at 120 kilometres per hour or Apple profits from peopleâ€™s inability to read sheet-music, carry a piano and sing for themselves while out on the road.
It could be argued that telecommunications is also a fundamental human right. Africa has a rapidly growing telecommunications sector. State-owned telecoms companies are being pushed aside from the ravenous profit-driven products of cellular phone companies. Poor people across the world are spending money on cell phones and driving astonishing profits for communications firms. They do this of their own free will and clearly feel that they’re scoring on the deal as well.
Yet pharmaceuticalâ€™s companies are being singled out to subsidise their own clients. No-one has complained that Apple iPods are too expensive for the destitute in rural Rwanda and that Apple should reduce the price so that everyone can listen to their favourite music in a democratic way.
Error of logic # 3: When a politician or aid agency promises to do good they can hold others responsible for failure to deliver on those promises
“Without a solution to the problem of access to medicines, they cannot meet their goals and obligations to their populations,” says Oxfam, in referring to the promises that aid agencies and governments have made to the poor.
These obligations are not the obligations of private companies. Private companies are not the slaves of politicians. If a politician makes a promise then it is his to deliver, not declare that private companies are now responsible for delivery.
Robert Mugabe, in Zimbabwe, has presided over the complete collapse of his countryâ€™s economy. He regularly demands that businesses deliver on his promises to create jobs and wealth for everyone there. When business owners were unable to comply he arrested many and nationalised others.
His â€œneedâ€ and bullying tactics have resulted in a decimation of opportunity and widespread poverty and disease in his country. Companies did not cause this. Politics did.
New products might be “needed” but it isn’t the duty of drugs companies to provide them. Adam Smith stated in the 18th century that, â€œIt is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest.â€
A drugs company knows how to make medicines; they make these – not because they seek your health – but because they want to earn a living. They choose to do so honourably, by exchanging a product a sick person will value, for their money. It is only governments (and NGOs) that offer weapons and their “need” in exchange for other’s labour.
Oxfam demands that pharmaceutical companies honour the â€œsocial contractâ€. What social contract? A contract is written to verify the exchange of value between two willing participants. This “social contract” â€“ as Oxfam states it – appears to require that pharmaceutical companies give away their products in exchange for society’s â€œneedâ€ for those products. What happens if pharmaceuticals companies decide to concentrate their energies on products that are of interest only to rich people? What happens to the poor then?
The most talented and able in the world do not become slaves to those who are unable to help themselves. Since when was â€œneedâ€ a reasonable exchange for â€œvalueâ€?
Error of logic # 4: Donations and charity should be spent on intangible feel-good things but to really get things done requires companies to give away their property
There is nothing to stop drugs being given away. But why should individual, privately owned, companies foot the bill? If Oxfam is so convinced that cheap drugs are essential to the poor why doesn’t Oxfam invest its, not inconsiderable, resources into its own drugs company?
Oxfam, according to their 2006 annual report, spent a grand total of US$ 683.25 million last year. This would buy an astonishing amount of life-saving drugs. If Oxfam does not do so it can only mean that it does not want to. Instead they spent US$ 78.88 million on a project entitled “Right to be heard”, and another US$ 46.19 million on “Identity”.
It is unclear from this report what tangible benefit Oxfam has delivered. Perhaps they are unable to? Demanding that others – who can – be slaves to Oxfam’s “need” is noxious.
If Oxfam regards as contemptible slave workers who are locked inside a sweat-shop and demanded to produce cheap clothing, why do they demand that chemists, biologists and scientists should be enslaved in a similar fashion?