How Brexit changed the way I look at biopharma’s reputation problem

This post first appeared in the Timmerman Report

You may have heard something recently about Britain, the European Union (EU), some vote or other, chaos, turmoil, blah, blah, blah…You might also have heard how the presumptive Republican nominee for President of the United States has gotten to that position by identifying a strong thread of anti-establishment, populist sentiment in the US. And you may have heard that biotech and pharma is suffering from a reputation problem.

One of these things is not like the other, right?

I’m not so sure.

That biopharma has a reputation problem isn’t in doubt. The question, though, is how the industry got here. I want to know this because, thinking like many drug developers, I believe that by knowing the cause of a condition a fix can more easily be found.

There have been numerous candidate reasons, and I’m open to the idea that the cause is multifaceted just like it is for many chronic diseases. In the past year alone we’ve had the Martin Shkreli circus, admonishments about drug pricing from political candidates, analyses of how yearly increases in pricing often outstrip inflation, Pfizer pursuing quizzical acquisitions to avoid paying taxes, and companies suing the FDA to prevent generic competition. Biopharma’s problems go further back, as well, and examples of less than exemplary behavior abound. Hey, I was working at Merck when Vioxx was happening.

But Brexit points to something else. While it makes sense to look for behaviors by biopharma for causes for the reputation problem, business doesn’t happen in a vacuum. Political and social trends over the past few years suggest a rejection of elite opinion and earned expertise that is touching many parts of society and culture. Derek Lowe at In the Pipeline had a recent fascinating post on this phenomenon in the context of Right to Try laws (and also delving into Trump and Brexit). As he points out, Right to Try laws sit in that thorny spot where technological knowledge of drug development and Libertarian impulses collide. I can come up with a half dozen reasons why I think Right to Try laws are in general a bad idea, and none of them will sway someone who wants access to an experimental therapy for their dying child. You can see this playing out in the debate about whether eteplirsen should be approved for Duchenne Muscular Dystrophy.

Where did this suspicious, and sometimes hostile, reaction to elites and expert opinion come from? MSNBC anchor Chris Hayes, among others, has posited that over the past several years many people have suffered the effects of broken promises and crippled expectations. If the social contract between elites and the rest of the population is that if the elites (whether they are Democrats or Republicans) are given power, everyone will benefit, then breaking that contract leads to disillusionment and, eventually, rejection. A similar analysis from another part of the political spectrum was made by Charles Murray (H/T to @ScottGottliebMD). One can also point to growing partisanship as, if not causal, at least maintaining and contributing to the diminishment of expert and elite opinion. Unfortunately, there is no precision discrediting. When one calls to question the statements of scientists on specific topics such as global warming or vaccinations, one tars with a broad brush and the whole scientific edifice takes a hit. It’s like those kids with the paint rollers in Splatoon.

From this perspective, the poor reputation of biopharma stems at least in part from larger societal trends in how people perceive expertise. Healthcare is highly complicated and technical, and it’s not a stretch to say it’s associated with the expert and the elite. Taking this perspective has some good and some bad implications for biopharma. On the good side, one can say it’s not (all) the fault of the biopharma companies’ specific actions that the industry’s reputation has suffered. But on the bad side, this makes it that much harder to fix the problem. Better general overall behaviors by companies are a prerequisite for improving biopharma’s rep, but not the final cure.

However, if biopharma is serious about its reputation, and buys into this theory, it could use this perspective in a few ways.

First, it can look at the one industry that is highly expert driven and still has a good reputation: high technology, as represented by companies like Apple and Amazon, among others. I would conjecture that these companies, by taking a very consumer-focused approach and a real dedication to innovation, simply show people repeatedly, several times a day, that they are trustworthy and worth the money. Now, this is hard to do in biopharma where product development cycles are pretty much the diametric opposite of the fail fast, hard and often ethos found in Silicon Valley companies. But the industry can do a better job of explaining its innovative and impactful products, and being honest about when new products have neither—and pricing them accordingly.

The second thing is biopharma could start taking a longer, more societally focused view in how it uses its considerable lobbying muscle. To take one example, many in the US (and Europe) feel betrayed by the obvious effects of globalization on unemployment in some job sectors. Those in favor of globalization routinely argue that everyone benefits from cheaper prices on manufactured goods and also that hundreds of millions of people in the developing world are seeing a substantial increase in their living standards. This is measurably true. It’s also an argument that doesn’t resonate at all with someone who trained and worked as a machinist for fifteen years and lost her job due to outsourcing. There’s an asymmetry in perceived benefit versus experienced insult and loss

Biopharma could push for greater investments in job retraining, in both the public and private sectors, as well as for extensions to programs such as unemployment benefits to allow people the time to get retrained. You might say that this is outside the scope of what biopharma is responsible for, but that’s a self-imposed limit. One of the arguments for why elites and experts have lost their status is that so many organizations seem to be concerned solely with narrowly defined self-interest and shareholder value; not with the workers, customers and society within which they operate.

It’s a problem, figuring out the best way to rehabilitate biopharma’s rep, but it’s a necessary one to solve for the industry’s long term health. The Trump and Sanders campaigns have demonstrated that there are large reservoirs of resentment out there that shouldn’t be ignored. And it’s not hopeless either. Large scale societal change in attitudes can be done. Canada, unlike much of the developed world, has created a culture welcoming of immigrants, and this was accomplished via a long standing, coordinated effort by the Canadian government and others to make openness a core Canadian trait. They persisted and took the long view. If biopharma can spend decades and billions of dollars in dogged pursuit of specific targets (I’m looking at you, amyloid beta), then perhaps it can do the same to try and change the environment in which we all live and work.