Wednesday, January 18, 2006

Protecting Those Who Need It The Most #1

So I was making my sweep though the law blogs today when I ran across an item at GreedyTrial Attorney. Which lead me to this link, where Mr. Lamb talks about the latest in the Bush Administration's attempt at "tort reform". According to the source article, from the Wall Street Journal, the Bush Administration appointees at the FDA are contemplating releasing a new drug labelling regulation to enhance the current regulations. While everyone seems to agree that this new regulation is needed, what the appointees have apparently added into the regulation is some pre-emption language.

What are they pre-empting? According to the article by Anna Wilde Matthews, the new rule would, "declare that federally approved medication labels pre-empt state law, a move that could strengthen pharmaceutical makers' defenses against lawsuits claiming injury by the companies' products."

Essentially it would say that there is only one standard, the Federal one, and that state legislatures cannot enact laws which would extend additional rights to the Federally imposed minimums. Appparently the poor drug companies are just suffering too much from having to make their drugs safer. The industry's argument is essentially that with 50 states, plus the District of Columbia, able to establish a patchwork system of additional regulations on the drug companies. This is bad, apparently, because it second guesses the FDA.

And it also helps to protect the ailing the drug industry. Or is it an ailing industry, beset by lawsuits which the Bush administration and their appointees at the FDA have to protect? A quick glance at the Merck information shows that the gross profit over the last four quarters has remained between 4.0 and 4.3 billion dollars (there was a bad Q1 in 2005). Now I am not an economist, but to my layman's eye, it certainly looks like they are making a profit. Furthermore, Merck, which is going through a series of law suits (as of my last check, going 1 for 2 in verdicts) has seen an increase in non-operating expenses. However, in that same quarter (the end of last year) it also saw an upswing in its sales.

It is true that this past year, the big pharmaceuticals have seen a rather large loss of profits. However, as the Fortune article, available here on the CNN website, point.s out, this is largely due to the expiration of patents allowing generic drug manufacturers to get into the market.( So probably what they will want to do next is extend the patent expiration date, again.) Not only that, but in the past year, the drug industry, meaning the patent holding, research and development companies, released 56 new drugs between 2000 and 2005. These drugs, referred to as blockbusters earned them over a billion dollars, each, for their manufacturers in the past year. And there are more on the way, which should, implies the article, more than make up for the patents which have expired in the past year.

So it appears that in the name of "tort reform", the neo-conservative administration is protecting those most in need of it. The rich, seemingly very profitable drug companies.

1 comment:

Greedy Trial Lawyer said...

The Bush Administration is like having a corporation as prsident. In fact, the Republicans should avoid the grief of finding a suitable front man and just nominate a large corporation for 2008.