Novartis Japan May Have Overstated Research Results to Sell Drugs: Are Patents the Cause?

The New York Times reported today that Novartis Japan has been discovered to have overstated research results to make the product more marketable.

Advertisements aimed at doctors in Japan reportedly claim benefits of the medicine Diovan, a blood pressure medication, that have not been proven by research.

The ads under investigation, which ran in pamphlets distributed among Japanese doctors, cited studies carried out at Japanese universities that appeared to show that Diovan was also effective in preventing strokes and other heart conditions, according to the Japanese Ministry of Health, Labor and Welfare.

But a number of universities announced last year that Novartis employees had been involved in carrying out these clinical studies, and that the data they yielded was suspect. Misleading ads violate Japan’s pharmaceutical laws, the ministry said in a statement to the news media.

Overstating results, though not unheard of for pharmaceuticals, is common in advertisements for nutritional supplements and other dubious health products. Unfortunately, it is possible that Novartis Japan is using the same tactics in a desperate bid to insure the profitability (or cover losses) of a lagging product. The patent for Diovan is set to expire soon, perhaps increasing the level of desperation.

I was disturbed to find out that Japan’s regulatory body does not recognize research conducted in areas outside of Japan. Certainlt, the country is known for its insularity and protectionist policy, but this seems counter productive. It would explain why many drugs are unavailable in Japan and why availability lags.

I’m not going to suggest that Japan’s health care system is poor. Far from it, Japan’s heavily regulated health care sector insures affordable care for everyone and fair compensation for doctors. I would say that disregarding research conducted aborad must increase overall costs, making Japan an unattractive market. All research for any new drugs must be conducted from scratch within Japan. This strikes me as odd.

The blog of the Center for Education Policy and Research claims that the patent system has induced Novartis Japan to overstate the results:

It’s Novartis and Japan today. The NYT reports on allegations that the company altered test results to exaggerate the effectiveness of Diovan, a drug for treating high blood pressure and heart disease. This is the sort of corruption that economic theory predicts would result from government granted patent monopolies. By raising the price of drugs by several thousand percent above their free market price, patents provide an enormous incentive for drug companies to misrepresent the safety and effectiveness of their drugs.

Odd. While I also agree that the patent system often works to stifle innovation and impedes access to life-saving drugs in developing countries, I’m not so sure that the patent system has caused Novartis Japan to misrepresent the drug. While the author speaks only patents here, I suspect that (though I have no proof), given the emphasis on the “free market,” he or she might oppose drug regulation as a whole providing an enormous opportunity for drug makers to misrepresent just about anything they like.