We’ve been sad lately. Once again, without explanation, our invitation to a presidential inauguration has been lost in the U.S. mail. We know that when the tears stop, as they eventually must, the emotional corner will have been turned.

It’s not that Barack Obama is merely charisma—or some sort of electoral fluke. No. He’s a genuine visionary. We wish him well.

It’s the rest of Washington that is the issue. Most of those people are the same characters who have created our problems. Obama and a few Clintonistas will be no match for the status quo. And that’s why things are dangerous for pharma. It is uniquely vulnerable and exposed in 2009.

Obama’s main problem, in our view is not the economy. Or terrorism. Or wars in the Middle East. The most ominous problem is a profoundly dysfunctional Washington for which his soaring rhetoric and congenial demeanor will be no match. It’s in that matrix of dysfunctionality that pharma could get hurt.

Three Factors

On any topic of any importance, America is locked in a vortex of three dynamics. These three factors drive Washington. They will complicate Obama’s efforts to accomplish anything. They stack the odds against serious, tough remedies during Obama’s presidency.

The first factor impeding Obama is wishful thinking or naiveté. The president-elect believes that the occupation of Afghanistan will have a different outcome than what’s happened in Iraq. He believes that giving banks three quarters of a trillion dollars will create jobs. Gullibility is an American epidemic at the moment. The collapse of good newspapers, the rise of Twitter, mean that many of our fellow citizens believe utter gibberish on tough, complex issues like immigration, vaccines, global warming.

Depending on our interests—Nine Inch Nails, free-range pork chops—we can go online and immerse ourselves in an informational bubble in which we will never be exposed to an inconvenient or contradictory fact. We exist, all of us, inside a beautiful cocoon of nonfacts that we hoard and cherish.

A Nation, Stuck

The second dynamic constraining Obama is a compromised regulatory system. The U.S. government has many thousands of decent, hardworking individuals. But the rules they enforce are written, in most cases, by the industries being regulated. This has lead to, shall we say, uneven results. Results that engender cynicism among many, many people. We’re thinking of minor events like the bailout of Wall Street. Or Detroit. Ruined fisheries. And Katrina. Cynicism is a big problem when it erupts, volcano-style, overwhelming more sensible and gradual societal change.

Anything that government has taken responsibility for has worsened. Social security, public schools, defective highways—if Congress touches something, it ruins it. The legislators are naturally skittish, then, about the hard choices they face. Instead, Congress focuses on trivia: can a brain dead patient be resuscitated against her family’s wishes? Can gays stay in the military? Does a new Illinois senator need a piece of paper signed by another Illinois official? These are the weighty matters with which Washington lawmakers preoccupy themselves.

The third dynamic pinning down Obama is the most sensitive. It is declining competence across American society. Whether we’re talking about security vulnerabilities in Microsoft software or resistance to new antibiotics, the basic competence of the U.S. must now be questioned.

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How America Works

Americans can make a microwaveable stuffed animal. But we are simply no longer good at doing things that are difficult. NASA’s next rockets are said to be fundamentally mis-conceived. Which federal agency will wind up owning those toxic mortgages?

Our Business

The three dynamics—wishful thinking, compromised government, slipping competence—mean the U.S. is adrift. In the midst of that drift, politicians will supply sugary rhetoric. They will mime “doing something.” This is where it gets dicey for the pharmaceutical industry. Where there is risk of well-meaning but ill-informed intervention. To prepare, pharma should borrow from the play book of the movie industry. Yes, Hollywood.

Cranking out formulaic drivel about puppies and vampires, the entertainment industry has escaped meaningful public oversight. Sure, Hollywood is responsible for the desensitization of the public to violence, for child zombies clutching cherished iPods and video games. But the industry has escaped regulation. It’s interesting.

Role Model

Strategically, brilliantly, over time Hollywood convinced the public and Washington that it was legit, trustworthy. Something that the pharmaceutical industry has not yet done.

It doesn’t matter exactly what Hollywood’s movie ratings do. Or whether its TV warnings are reliable. It does matter that Americans believe those rating systems “work.” The prevailing belief that Hollywood has a good head on its shoulders protects it from Washington meddling.

Pharma is in a completely different category, and not just because it exists under a large body of regulation. It is at risk of being targeted by a shifting crowd of academic physicians, goofball politicians and well-meaning citizens who want the latest, most powerful medicines for their own families, but dislike the industry that provides them. In such a climate, with the three dynamics we’ve sketched, squirrelly and unpredictable tidings may emerge from our nation’s lawmakers.

Our remedy is counterintuitive. The industry should support just one (1) new, binding and strict regulation on itself. Pharma should take this tonic knowing that it will cause politicians to move on to a new imaginary demon. Hospitals, perhaps. Or insurance companies.

The tobacco industry blazed the trail here. It offered a mea culpa, and the mob attacking it moved on. Pharma should do the same. Let the politicians call a triumphant news conference. That’s what they’re after. Then politicians will seek fresh illusory bogeymen, galloping off in a new direction, Don Quixote style.

New Moves

For an industry like ours, which has had brutally negative news coverage for many years, penny ante gestures and gimmicks (such as selectively listing physician grants) won’t cut it. A significant concession is required. A few ideas to be required by federal regulation or statute, not voluntarily:

• A complete and immediate ban on all direct-to-consumer drug advertisements in all media—print, TV, radio, online, search.

• Mandatory online publication of all final clinical trial study reports, from Phase II-IV, and not in frozen PDF format but in X-HTML so that they can be easily searched, analyzed and cross-referenced in the medical literature.

• Governmental price negotiation for Medicare and Medicaid prescription coverage.

Would any one of these be a large pill to swallow? Certainly. But the industry’s current circumstances require a serious response to antiscientific, anticapitalist politicians who have drug companies on their minds, time on their hands and no appreciation of the difficulty of innovation.

For now, the pharmaceutical industry is big enough, resilient enough and prosperous enough to take a bullet to the leg. Waiting would be risky. After more details of the nation’s financial crisis are understood, or new debates inside the FDA come to light, the anger and cynicism of the public could be tapped by politicians interested in more disfiguring injuries.

 

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