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Roche Must Share Its Avian Flu Cure

If ever there was a time for government to step in and restrain unbridled corporate greed for the social good, this is it.
 
 
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Next to the Department of Commerce building in Washington, D.C. stands a powerful statue that speaks of a time when America believed in government. A naked man, arms outstretched and muscles bulging, tries to restrain a powerful, writhing horse. The statue evokes the extraordinary power of entrepreneurial energy and corporate greed. But it also reminds us that unbridled greed is socially destructive.

Today the statue goes unnoticed. Visitors who do stop by probably wonder why the Department of Commerce is home to an equestrian statue. (Or perhaps they are simply dismayed at the sight of a bigger-than-life naked man in George W. Bush's Washington.) In contemporary America, the statue's message is so out of place as to be virtually incomprehensible.

All of which brings me to the avian flu. If ever there was a time for government to step in and restrain unbridled corporate greed for the social good, this is it. A consensus exists on the basic facts:

  • The H5N1 flu strain has infected more than 100 people worldwide. About half of infected people die.
  • The disease is currently transmitted from birds to humans. Migratory birds have spread the disease from Asia to Romania, Turkey, Greece and parts of Russia. It is expected to arrive soon in the Middle East and Africa.
  • Scientists have recently discovered that the 1918 influenza pandemic -- which killed more than 50 million people worldwide -- originated in birds and then mutated to where it could be transmitted from humans. It is expected the H5N1 flu virus will experience such a mutation at some point, which could lead to a very rapid spread of the disease.
  • The only currently available cure for avian flu is a drug called Tamiflu. Roche, the giant Swiss pharmaceutical company, owns the patent. The company concedes it will be several years before it can produce sufficient amounts to deal with the looming crisis. But it refuses to allow other companies to add to the productive capacity.

One would think that with such a clear and present danger to their populations, governments would quickly require Roche to license the drug's production. One would be wrong. Bush's plan to combat the flu, unveiled this week, recognizes the looming danger, but then simply asks Congress for billions to pay Roche for any drugs the company might make available. The plan lacks a critical element: a way to accelerate production of the drug.

A threat from several members of Congress to do just this prompted Roche, on Oct. 25, to reluctantly agree to open talks with four generic firms to discuss allowing them to manufacture the drug. It is unclear when or even if these talks will result in increased production. Moreover, generic firms are in the business of encapsulating existing medicines. It is unclear whether they have the capacity to make new medicines, especially given the complexity of manufacturing Tamiflu.

One Indian company has already said it will soon be manufacturing Tamiflu without a Roche license. But because it lacks the license it will not be able to export the medicine to the United States. Recently, Australian health officials argued that the country has the moral responsibility to begin mass production of Tamiflu, with or without Roche's permission.

The pharmaceutical industry, already under serious pressure because of its exorbitant prices, high profits and unwillingness to produce essential medicines in other areas, may well not want Roche to become its poster child. The company has a long and unsavory record of social irresponsibility.

In the case of Tamiflu, Roche didn't even develop the drug; U.S. biotech firm Gilead did. Nine years ago, Gilead signed a development and licensing agreement with Roche. It is currently suing Roche, claiming that Roche has been negligent in its manufacture of Tamiflu, which has led to a series of product recalls.

In the 1970s and again in the 1990s, Roche was involved in price-fixing scandals. In the '90s it was fined more than $500 million by U.S. and European governments. Roche has also been singled out by public health advocates for obstructing AIDS-devastated African countries from gaining access to vital medicines. It was one of a number of pharmaceutical companies that threatened to take South Africa to court to overturn that country's initiative to produce cheap copies of expensive brand-name anti-HIV drugs.

If ever there were a case in which private property rights need to be subordinated to the public good, this is it. A life-threatening disease that may, by all scientific evidence, infect tens of millions of people has only one existing cure. Yet the company which produces that cure refuses to allow sufficient quantities of the drug to be produced.

If an individual were suspected of planning to release a disease-laden vial in the United States, the Department of Homeland Security, the FBI and the CIA would spring into action. They would (and have) seize the individual and put him into solitary confinement without access to a lawyer. Torture would even be deemed acceptable. But when a private corporation knowingly, willfully and consciously refuses to make available a drug that would stop a disease that will soon enter our borders via natural transmission paths, we feel powerless.

Apparently, the first situation rises to the level of a national security matter; the second, in the parlance of modern-day Washington, is a business matter. In the first case we can pull out all the stops to save lives, civil liberties be damned. In the second case we must tread very carefully. The sanctity of private property and an unfettered marketplace trumps our desire to avoid massive injury.

I'm too old to understand the rationale in all of this. But then again, I'm also someone who always stops at 14th and Constitution Avenue to marvel at that statue and recall a time when we believed that maximizing the public good was government's highest goal.

David Morris is co-founder and vice president of the Institute for Local Self Reliance in Minneapolis, Minnnesota and director of its New Rules project.