Speeches & Communication

2012 PhRMA Annual Meeting: President's Address

PhRMA April 13, 2012

John J. Castellani
President & CEO
Pharmaceutical Research and Manufacturers of America
Annual Meeting Address
Boston, Massachusetts
April 12, 2012

In our industry today, everyone uses familiar words to describe what we do: Innovation, progress, technology, value, science, partnership, solutions, jobs and so many more.

But to resonate, these words must do more than just describe – they must tell our story.

One way we are bringing this narrative to life is through video libraries at PhRMA’s website and Facebook page, containing some of the amazing stories to which we in the biopharmaceutical research industry must always return.

They include explanations of how medicines are developed and interviews with researchers talking about the impact and promise of their exciting work.

But most importantly there are patient stories. The stories of the men, women and children whose lives are better and whose hope for the future is strong in part because of the medicines developed by PhRMA member companies.

One story, called “A recipe for hope” belongs to Melinda Winner.

When you see her story, you’ll realize how appropriate her name is.

Melinda has painful, acute arthritis. In spite of her constant pain, she moved to the Gulf Coast after Hurricane Katrina hoping to use her talent and passion for cooking to help the region rebuild.

She and a partner run a small restaurant and catering business serving home-cooked meals to construction workers. Getting up every day and going to work, preparing meals and getting them out to her customers is a constant struggle.

She relies on special tools and kitchen techniques to get her through her day. She also relies on innovative medicines. She says: “without biologic drugs, I don’t think I’d be here today. I was headed down that dark road.”

And she says that these medicines “give me the freedom to dream and the freedom to live that dream.”

Melinda’s story is moving and inspiring but it’s not unique.

Whether we’re talking about arthritis, diabetes, HIV/AIDS, rare or chronic diseases, there are literally hundreds of thousands – if not millions – of Melinda Winners. People living their lives, fulfilling their dreams and contributing to their communities and families – all helped by medicines pioneered by a PhRMA member company.

Millions more wait for the next medical advancement to help prevent, treat or finally cure painful, debilitating and even deadly conditions.

Melinda’s story brings home the fact that all of us in this room share something with her. We – you, me, all of us – will one day, for one reason or another, be a patient.

This truth leads to questions we must ask ourselves – as well as our allies, policymakers and, yes, our critics.

Knowing you were or will again be a patient, how do we – as an industry and a society – ensure that innovative medicines are available in your time of need?

How do we support the R&D necessary to keep the medicine pipeline flowing for every American and for patients around the globe?

This truth also reminds me of how fortunate I am.

My 96-year-old father is active, spry and healthy – hopefully for many years to come. But one day he will again be a patient.

Also, maybe not today, but I, my wife, my sons, my daughters-in-law and even my 15-month-old grandson – that brilliant toddler that too many of you have heard me bragging on – will one day be patients too.

My hope – especially for my grandson – is that we will have innovative medicines and yet unimagined medical options available to help treat what ails us, ease our pain, manage and cure our diseases.

I know you share that hope for yourself and those you love.

That is why this industry exists.

That is why we must make sure that the innovation pipeline keeps flowing, that new treatments and cures keep coming and that America – patients, policymakers, healthcare professionals, everyone – understand that this industry is dedicated to finding solutions to our healthcare challenges.

While thinking about a bold pro-patient, pro-innovation, pro-economic growth agenda for PhRMA, I came upon something the science fiction writer and futurist, Arthur C. Clark, said about technology and innovation.

Clark, as some of you may know, wrote 2001: A Space Odyssey and other novels and screenplays.

He was a visionary. He is credited in the late 1940s with proposing use of geostationary communications satellites to revolutionize global communications.

His vision is today’s reality.

Clark was also famous for his three laws:

  1. When a distinguished but elderly scientist states that something is possible, he is almost certainly right. When he states that something is impossible, he is very probably wrong.
  2. The only way of discovering the limits of the possible is to venture a little way past them into the impossible.
  3. Any sufficiently advanced science is indistinguishable from magic.

These laws seem particularly relevant to our industry, but I want to reverse the order.

We know what we do is not magic.

Yet, not so long ago, our accomplishments and the scope of our medical capabilities would certainly seem like magic to physicians and patients.

For nearly 1800 years, the Greco-Roman idea of the proper balancing of the four humors – blood, yellow bile, phlegm and, my favorite, black bile – governed western medicine.

But bold, innovative, counter-intuitive and risky experimentation – much of it pioneered by chemists and pharmacists – revolutionized medicine. The results are that people today are living longer, healthier lives than ever before.

Now, once deadly diseases like small pox and polio have been nearly eradicated. And, people today live with chronic conditions like diabetes and heart disease that once killed our not-so-distant ancestors.

In fact, life expectancy in the U.S. and in other developed countries has increased so greatly that we begin to face an emerging policy challenge of how to support a growing and increasingly healthy population of senior citizens.

This “magic” resulted from difficult, innovative, sometimes brilliant and often failed scientific research.

In short, Clark’s 2nd law: discovering the limits of the possible by venturing a little way past into the seemingly impossible.

For example, anyone who knows the story of cancer – brilliantly detailed, by the way, in the book The Emperor of All Maladies – understands how researchers and patients risked everything to do the impossible:

That is, buy a patient and their family a few months more here and a year or two there.

In the book, Siddhartha Mukherjee recounts how the staff of the Dana-Farber Cancer Institute here in Boston were reunited with Einar (Eye-nar) Gustafson, otherwise known as “Jimmy,” a truck driver from upstate Maine.

Jimmy – the namesake of the nationally-known Jimmy Fund – came to Farber’s clinic as a boy in the 1950s with intestinal lymphoma. He was presumed long dead. But this was not so.

Mukherjee touchingly described the 1998 reunion:

“Everything has changed … The rooms, the patients, the drugs. But more than anything, survivorship had changed.”

In a nutshell, this captures our industry’s contributions to health and humanity.

Today, we can beat some cancers. We can manage others as chronic conditions.

We’ve real hope of new treatments for many more – nearly 900 new cancer medicines are in the pipeline.

We can and should be proud of our contribution in the war on cancer and other diseases – both for what it does for patients as well as how it is transforming the way medicine is practiced.

Think about diabetes, stomach ulcers and heart disease. Once, very costly hospitalizations and surgery were the standard of care. Today, we can better treat these conditions with medicines and, as a result, we have improved the quality of patients’ lives and reduced costs for both patients and our healthcare system.

In this context, also think about ongoing challenges like HIV/AIDS.

Just thirty years ago there were no treatments. If you got HIV/AIDS, you went to the hospital, required massive medical intervention and you died.

But pharmaceutical companies, academic and government researchers, patients, their families and healthcare professionals rallied together to push HIV/AIDS research forward.

Today, HIV/AIDS is not a death sentence. It is a disease that for many can be treated as a chronic condition.

Patients are living with it and enjoying longer, more productive lives.

And this brings me to Clark’s first law: brilliant researchers and scientists believe that a final HIV/AIDS cure is possible – maybe soon, maybe not, but possible.

They say the same about a growing number of cancers, rare diseases and many of today’s chronic conditions.

Realizing these possibilities will take hard work, perseverance and huge investment.

It will require pushing back the boundary of what is possible today.

To get there, we must plan for success. We must foster an innovative eco-system that inspires science, rewards investment, promotes regulatory consistency and transparency, and values how innovative medicines improve health.

We’ve made great strides towards this goal. Our work on patent reform, ensuring appropriate data protection for innovative biologics and, soon, reauthorizing PDUFA to help ensure FDA has the resources and skill set necessary to keep up with our science, are strong steps forward.

So, when the public and policymakers say: “Don’t tell us about yesterday, what are you doing for me today and tomorrow?” we can respond with authority.

We can point with pride to FDA’s approval of 36 new molecular entities last year– one of the highest totals in the last decade – including: 11 for rare diseases; two new personalized medicines for lung cancer and melanoma; two first-in-class for Hepatitis C; and the first new treatment for Lupus since 1955.

We can point to our pipelines – the source of future solutions.

And, to those obsessed with the so-called patent cliff, consider this:

Today, there are more than 3,200 medicines in clinical trials or under FDA review in the U.S. – up from 2,400 six years ago. These are numbers to celebrate.

We can also take pride that our industry continues to make critical investments in the future even in the midst of economic uncertainty.

In 2011, PhRMA members invested an estimated $50 billion in R&D – just a fraction below the previous year’s investment in a difficult economic environment to say the least.

Impressively, according to the National Science Foundation, our sector accounts for nearly 20 percent of all R&D funded and performed by U.S. businesses – the single largest share of all U.S. business R&D.

I repeat: our sector accounts for 20 percent of all R&D funded and performed by U.S. businesses. This is a staggering, underappreciated fact and we must shout it from the mountaintops.

There are two messages here for policymakers:

  1. To continue creating the healthcare solutions today and into the future, we need a strong, dynamic U.S. biopharmaceutical sector.
  2. To build our economy, create 21st Century jobs and stay globally competitive, we need a strong, dynamic U.S. biopharmaceutical sector.

Historically, America has welcomed medical innovation. It’s why America leads the world in the field.

But you know as well as I that the R&D you do need not be based here.

Our global competitors understand this.

If we cannot make a clear, inescapable case for policies that inspire and reward medical advancement, if we only focus on today and what has been accomplished last month, last year or a decade ago, America will not remain a globally dominant force in biopharmaceuticals.

China, India, Russia, Singapore and other countries that understand the human and economic value of an innovative biopharmaceutical industry will reap the rewards, not American patients or the U.S. economy.

To our policymakers, we must demonstrate how this industry is nimbly evolving to meet new challenges. This includes:

  • Shifting areas of research to target the greatest unmet needs – like Alzheimer’s, cancers and Parkinson’s;
  • Identifying and implementing technological advances in the drug discovery process, with the goal of improving R&D productivity and efficiency; and,
  • Embracing a wide range of partnerships and collaborations.

The Tufts report on partnerships unveiled this week underscores the power and importance of collaboration in today’s medical ecosystem.

Since taking PhRMA’s helm, I’ve asked you along with legislators, regulators, allies and other healthcare stakeholders: Let us find new ways to work together.

Only through new and stronger partnerships among business, academia, government, patients and healthcare professionals will we meet the challenges ahead.

Let’s also demand policymakers be consistent.

For instance, we meet today in Massachusetts.

The state’s $1 billion life sciences initiative is a perfect example of the kind of enterprise eco-system I’ve mentioned.

They’ve had impressive success leveraging technology, building local economies, creating new healthcare solutions and bringing those solutions to patients.

Massachusetts rightfully takes pride in these efforts.

Yet, Massachusetts – like so many states and the Federal government – sends mixed messages when it comes to our industry.

In addition to the positive initiatives I’ve mentioned, the state has adopted unprecedented restrictions on marketing and education by our companies, and some legislators continue pushing for policies that would restrict Bay Staters’ access to innovative new medicines. Such inconsistencies are counterproductive.

Remember Melinda Winner the Arthritis patient. Under these policies, her doctors may not get the information they need to stay current with relevant treatment advances and her access to some medicines could be limited to yesterday’s medical technology – generics versus the latest, best treatments for her needs.

Policymakers and the public have understandable concerns about access to and the cost of medicines. Concerns we share – both as men and women in the biopharmaceutical research business and as future patients.

But there is a bigger picture to consider – one of changing patient and health system needs; risky and costly R&D; increased global competition; and regulatory and oversight processes in need of modernization and improvement.

To understand and address this broader framework, we must remember three important challenges that shape every decision we make.

First, the science is hard and with every breakthrough and step forward, it gets harder.

Second, the fiscal environment remains daunting. Payers at all levels struggle to control costs. We must better make the case that medicines are part of the solution to rising costs.

Finally, every company here confronts the skepticism of investors weary of the risky, lengthy and often unsuccessful process of developing drugs.

When I think on these challenges and our accomplishments, I hear our critics and their often one-dimensional focus on cost, and I say: “How dare they?”

How dare they view the millions of lives extended, improved and saved and not see the contribution of the medicines we develop?

How dare they ignore our investment in communities, states and our national economic health through the millions of people directly and indirectly employed by PhRMA member companies?

How dare they fail to see the hurdles ahead – the cost of untreated Alzheimer’s and preventable chronic diseases – or understand the national healthcare and economic disasters likely to result from inaction?

How dare they focus on the short-term budgetary gain at the expense of long-term societal health, productivity and savings?

And, how dare they question our commitment to responsible science and the patients we serve?

But such thoughts are overtaken by the inspiring stories of patients – like

Melinda Winner – whose lives are transformed in part because of innovative medicines created by this industry.

They are overtaken by the hope that my grandson may live to see a world where Alzheimer’s, cystic fibrosis, cancers and Parkinson’s may be prevented, managed and even cured.

And, they are overtaken by the knowledge that the development of new medicines helps both patients and contributes to a stronger, more flexible, and smarter American economy – one that can continue leading the medical revolution and compete globally.

So, let me close with this thought.

As our industry strives to make the impossible possible, the questions we pose to patients, to policymakers and to our critics are simple.

They are the questions I ask when I look at my grandson and my father:

How do we dare not go forward?

How do we dare not take on and beat cancer, Alzheimer’s, HIV/AIDS and diabetes?

For our children, grandchildren and the great grandchildren we will hopefully live to know: how do we dare not see the progress of the last 100 years as a mere prologue to the magic that can be had over the next 100?

We know the answer. We are daring to do just that.