Welcome to Lean to the Left, the podcast that explores important developments that shape our society and our world. Our guest today is Hank Laskey, PhD, a longtime adviser and consultant in the pharmaceutical industry.
Hank brings a ton of knowledge and perspective about this industry and the companies that provide the life-saving drugs so important to us all. We’ll tackle some of the factors that affect the prices we all pay for our prescriptions and hear his thoughts about what can, and should, be done about that.
Dr. Laskey also will share with us insight that will help those who want to enter that industry, or advance within in it. That’s part of the reason why he authored a book called “The Global Pharmaceutical Industry: Economic Structure, Government Regulation, and History.”
The book combines the study of business and economics with medicine, science, and technology-all within a regulatory framework-and helps the reader understand the multifaceted global pharmaceutical industry.
Dr. Laskey, welcome to the Lean to the Left podcast.
Q. One of the major concerns that most of us have today is the high cost of prescription drugs. With insulin, for example, it got to the point where Congress capped the price at $35 per month—but only for Medicare patients. Can you walk us through what’s involved here?
Q. What did you think of Martin Shkreli, the Turing Pharmaceuticals owner who jacked up the price of insulin to crazy levels and who raised the cost of a decades-old drug used to treat infections in babies and people with AIDS by more than 5,000 percent?
Q. Every time we turn on the TV we’re bombarded with ads for pharmaceutical products for everything from HIV to cancer to skin rashes. These products are targeted to narrow segments of the population who suffer from these various diseases. Yet, those ads are within programming that is geared to a general audience. Does this make sense?
Q. How does the marketing side of the industry interact with the medical side? Are these marketing costs reflected in the ultimate price consumers must pay for these drugs?
Q. PhRMA, the lobbying organization representing the industry, has published a piece on the web that claims that “due to negotiations in the market,” prices health plans paid for brand medicines increased by just 1 percent on average in 2021. They blame insurers and other middlemen for forcing many of the sickest patients to pay high out-of-pocket costs. Really? Your comment?
Q. Sometimes at the end of a commercial, after all of the possible side effects are revealed, the voice/over will say that “X company may be able to help” with the cost. What are these patient assistance programs offered by biopharmaceutical companies and how do they work?
Q. What are the differences between generic drugs and brand medicines? Are the generics just as good and as effective?
Q. The industry always claims that the cost for prescription drugs must reflect the high cost of research and development. To many, this seems like a cop-out. Your thoughts?
Q. What’s your view of federal regulation of the industry? Does there need to be more? In what areas?
Q. Let’s talk about those individuals who would like a career in this industry. You’ve worked as a consultant, published research articles, taught courses for several leading industry companies. What’s your advice to those who want a career in the pharmaceutical industry or move up within it? Does your book address this?
Q. Where can people find your book?
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[00:01:08] Hank Laskey: Thank, you so much and, hello to your audience. I'm so happy to be here.
[00:01:14] Bob Gatty: Thank you. Now, one of the major concerns that most of us have today, Hank, is the high cost that we all have to pay for prescription drugs. With insulin, for example, it got to a point where Congress capped the price at 35 bucks per month, but only for Medicare patients.
[00:01:33] Can you walk us through what's involved with all of this?
[00:01:37] Hank Laskey: I suppose so. There are enormous technical difficulties in producing the drugs and distributing them to a worldwide population. The worldwide population is growing at an enormous rate. During the pandemic, a lot of people spent the day at home having fun with each other, and children are the result of that.
[00:02:06] And there are a lot of them. They're being born and we have to deal with that as an industry. On top of that, you have an emergence into a realm of artificial intelligence and computer generated diagnosis. And also the artificial intelligence that goes into connecting up that world with the world of production, of distribution.
[00:02:38] But, let's talk about innovation also, the new drugs.
[00:02:41] Bob Gatty: Okay. . All right. Insulin's not a new drug. So why is it that why is it, that like this guy, Martin Shrek, or whatever the hell his name is, he jacked the price up to the point where Congress got involved and, then he tried to he raised the cost of, another old drug that's used to treat infections in babies and people with AIDS by more than 5000%.
[00:03:13] What the hell? Why, do we have to deal with that kind of stuff?
[00:03:19] Hank Laskey: It's a distribution issue. Yeah. Yeah, man. There's not enough of that stuff to go around. Yeah. And there, there is an enormous marketing schema around the world to distribute this stuff, and they need to be coordinated with the production and the consumption of the drugs.
[00:03:46] There's so many people in this world that pharmaceutical industry, this is important. Yeah. The pharmaceutical industry is concentrated in just three parts of the world. Okay. The United States and in particular here in the Delaware River Valley. Western Europe, in particular Germany, but to some extent France.
[00:04:11] They have fought over the Rhine forever. Okay. And then finally Japan, who we kicked their butts in World War ii, just like we did the Germans and we seized their patents and we made them public property. Okay. Now that's a big deal, that there the, populations in Africa, India, South America, the Philippine Islands, buddy it's a lot of people, man.
[00:04:44] And we don't have enough manufacturing facilities. We don't have a distribution system that is coordinated and that's the key word, what is gonna coordinate that distribution system in the future.
[00:04:59] Bob Gatty: What you're saying is that the, fact that these prices increase on, drugs like insulin, for example, isn't related so much to the greed of the pharmaceutical companies.
[00:05:16] Hank Laskey: It's the sugar consumption of the population, man.
[00:05:20] Bob Gatty: The sugar consumption of the population.
[00:05:23] Hank Laskey: Yeah.
[00:05:24] Bob Gatty: Which is, which causes people to have diabetes. Yeah. Yeah. Yeah. And you're saying that there's not enough supply to go around the world. The world.
[00:05:38] Hank Laskey: Absolutely. And when you go across boundary lines between not just countries, but between civilizations like the Middle East or the old Soviet Union or Western Europe, eastern Europe, Latin America. When you go into these different civilizations, everything's different. Uhhuh, , and a computation of value as you go into that deal and the relative value of the dollar, okay, how many dollars can they come up with? To buy the product. And the answer is not many.
[00:06:18] Okay. So we have to lower the price there to get the product in, and that makes a lot of people pissed off. Mexico, for example, the drugs are basically free at the, not free. You pay for them, but you don't need a prescription. Okay. For a lot of drugs and that's way different. The systems are so different.
[00:06:43] In Japan for example, the doctors not only prescribe the medicines, they give 'em out. Okay. So you've got a wacko worldwide system that developed piecemeal over the years, and it needs to be coordinated by guys that know there is discovery of that drug. There is development of the drug, there is the manufacturing of the drug, and there is the distribution of the drug, and if we can coordinate those four things. But the problem is man, the population is growing like a bat outta hell. Okay.
[00:07:25] Bob Gatty: That ought to be a good thing for the that means there's lots of customers.
[00:07:30] Hank Laskey: Yeah, but how are we gonna supply the drugs that this booming population is gonna require?
[00:07:38] Look at the baby boom right now retiring. You are on the outer cusp, the upper cusp of the Bsby boom. I am in the dead center middle. There's about 10 years between us, right? And there's 10 years below me. So there's about 70 million people born in the United States and they had children, and then their children had children less, less, And then all of a sudden, boom, here comes the pandemic. And you got a lot more kids being born around the world. So the population is growing. It's naturally growing because of our e emphasis on romance and love and all kinds of religious beliefs and the sanctity of marriage and yeah, yeah.
[00:08:28] Bob Gatty: I'm chuckling because, you made the point that with the pandemic there's a lot more babies being bored. . Yeah. That's bec why that was because we had nothing more to do than, to stay home and, have sex. Is that pretty much it?
[00:08:45] Hank Laskey: That's it. It's just like when the GIS came home from Germany and Japan the women were there. They were receptive. Yeah. And, it's a love thing. It's an attraction thing. What are we gonna do? Are we gonna stifle the, progenitive urges of men ? Is that what we're gonna do? Yeah. I, heard this lady yesterday. I went to the doctor yesterday. Two doctors. Yes. Saw that yesterday actually.
[00:09:20] that's what happens. That's what happens when we get to be in, in our age group Yeah. And it's not only the drugs, it's the whole medical healthcare system. Yeah. It, the, it's backed up crazy. The, interaction between the patient and the doctor. actually takes place over about 10 minutes or 15 minutes.
[00:09:46] That the doctor is allocated time by the formularies to do the job. And it's all backed up by basically secretarial personnel who are modulating the availability of these doctors. And then you've got to tie into that system and figure out who to see and make an appointment.
[00:10:11] That it's tough. So you, look at the whole system really, and it's ability to deliver healthcare to a booming population. Hell we're even concerned here in the Delaware River Valley about vegetables. Is Costco gonna run out of fresh fruit and vegetables? That's an issue.
[00:10:35] Really? Yeah. Yeah. Why is that? The, fields have been decimated by heat waves and, torrential rain pours and dry weather in the summer. So climate change is, yeah. The Ukraine is not producing anything that it used to produce. It needs to come back online. But drugs let's think about that.
[00:11:07] They're manufactured here in the United States, right? In Western Europe and in Japan. Yeah. 10 countries max. Okay. Okay. Because the, what you have to create in your population and your universities and your graduate schools, The highly sophisticated people that you wanna put into your laboratories, where you've got millions of dollars worth of equipment to design these drugs to build them, to test them.
[00:11:43] These people are smart, man.. They're well educated to the max. And, how you going to get people like that? Where do they come from? Now there's a lot of people raising their hands and saying me, But they're not educated. They, they don't know the system that they're working on.
[00:12:06] We're in the middle of a huge turn of events here, okay. And we're either gonna figure it out and manage it the way it should be managed, get government out of it. Let price be dictated by the market. if we have to cut price, why? Why would we cut price? Increased competition.
[00:12:30] How are we going to get increased competition? You've got the development of the drug, the discovery before that, the development, the manufacturing, and the distribution.
[00:12:43] It's a complex system. It has evolved piecemeal over the years. Now, bear in mind, the pharmaceutical industry is only a little over a hundred years old. The very, first organic chemical, what we call synthetic organic chemicals, were produced in 1856. Okay. . And, that was done in England by William Henry Perkin, but it quickly spread to Germany, and that's where the industrial machine of the Germans took over, man.
[00:13:20] Okay. And they, just produced like crazy. They totally dominated the world's market for pharmaceuticals at the time of World War I and two. Totally dominated it, and not only for pharmaceuticals, but for a very related industrial process that is called it's basically textiles and die stuffs and what gives us color that whole area is the same feedstock material as the pharmaceutical industry. Now, not insulin per se. Insulin has been produced from the pancreas of the slaughtered hogs for a long, time. And we now know how to produce steroids. Insulin is a steroid. We, know how to produce steroids from soybeans. Okay. And, over 50% of the steroids that we consume come from soybeans.
[00:14:23] So that's a hell of a technology. Now, can we grow enough soybean? Answer, not lately. We can produce cephalosporins from corn. How many corn fields have you seen being harvested lately? What's, going on in Iowa and Indiana? More than that, what's going on in Argentina and Brazil?
[00:14:47] What's going on in Africa? Think about what we call the Mediterranean diet. That's, the core of civilization. That's where recorded history began, and we can trace the evolution of the industry from its inception from Alexander the Great and Theo Fraus when they went all the way into the Himalayas.
[00:15:14] So that, that whole thing got codified really by Justinian about 500 AD 5 35 ad. Now what happened then was very, interesting. It got transferred into France and into the ladies of the court and their greenhouses. And how they tried very hard to grow medicinal plants.
[00:15:50] And they did. They did. And then that science was transferred to the British Isles. Okay. When the Reformation took place. Okay. Martin Luther and John Calvin and, those guys. So then it passed into the hands of immigrants who came here to the United States, religious sects, who came in through New England and moved down into the Delaware River Valley and moved out along the Ohio. So you have Abbott Labs in Chicago and Eli Lilly, and you have the, Ohio River Bunch. And then here you have Johnson and Johnson, you have Merck, you have Shering Plaugh, you have Pfizer, they're all right here. I've been on their campuses. I've taught courses to their employees.
[00:16:47] This is a massive industry, man. It's it's incredible. Now, how many companies did I just rattle off? Less than 10. You add Teke, you add Takeda from Japan, and that's one more. But who else? You gonna name AstraZeneca? Yeah. They're, in. There's, there are some German companies.
[00:17:12] The old IG Farbin still exists in a corporate form that we can very little see but it's there. Okay. So, coordination of all this stuff is what we've gotta do.
[00:17:27] Bob Gatty: Alright, that makes sense. Now I got a question for you that really bugs me personally. Okay. Every time I turn on the TV, I'm bombarded with ads for pharmaceutical products, for everything from HIV to cancer, to skin rashes.
[00:17:50] And these products are targeted to narrow segments of the population who suffer from these various diseases. Absolutely. Those ads are within programming that is geared to a general audience. It seems like a massive waste of money. . Is that true?
[00:18:11] Hank Laskey: , wrote my PhD dissertation on television advertising effectiveness with pharmaceuticals.
[00:18:19] It's difficult to know what kinds of images and even sounds Yeah. People will, attune to and get involved. Now what you're talking about is direct to consumer advertising. Exactly. That has not been allowed in the United States, but for what, 10, 12 years maybe. Yeah.
[00:18:45] Bob Gatty: But when it, once it's been allowed, it's been , it dominates.
[00:18:51] Hank Laskey: It, they spend a lot of money on it. They do. They're trying to explore it as a medium. Yeah. For and for educating people about all aspects of their human health and fitness. How good a job have they done? You, identify the problem. It's the audience.
[00:19:15] I was watching TV the other day and thinking, look at the age of the people in these commercials. They're old like me. Then I changed the channel to CBS and I said, look at the age of the people here. Nora O'Donnell is in her prime. Margaret Brennan is in her prime. The audience that they are sending to includes me, right? And I need drugs. I, need the medicines that I take. And you need the medicines that you take. We or, so the doctors tell us, right? We don't have computerized analysis of our blood yet.
[00:19:58] Thank God for the, whatever the name of that company was with Elizabeth Holmes from Theranos Outta Stanford and got everybody to invest billions of dollars in her company and then was found out to be a total fraud. She's now in federal court. What was she trying to do? The idea was wonder.
[00:20:23] That's why so many guys jumped on board with billions of dollars. She, thought, see if you have computerized medicine, if you have a computer who's checking your health out and telling you what to do, it's gonna have to test your body. It's gonna have to see what the chemicals biochemicals organic chemicals in your body are doing.
[00:20:50] How they gonna do that unless they take a sample? Yeah. So the computerized system stops. Artificial intelligence stops right then and there because you need to sample the person, the individual person. And she told us that she could do that with a little tiny bit of blood. . Okay. And that's attractive, man.
[00:21:16] That is one good idea because you can sit at home and, have your watch monitor. I have a diabetes sensor on my arm. Okay. That's right into my blood supply. Okay. It's not a big deal. Okay. So she was trying to sell Elizabeth Holmes. Was, a very, it still is, it's a very attractive idea. But how are we gonna get to it?
[00:21:44] It's okay. It's a tough sale. Okay.
[00:21:47] Bob Gatty: Now we I asked you a question dealing with marketing. Yeah. How does the marketing side of the industry interact with the medical side? And are these marketing costs reflected in the ultimate price that consumers pay for the drugs?
[00:22:02] Hank Laskey: What a fantastic question. just fantastic. I'm gonna come at it from a direction you might not expect. Okay. But the scientists that I referred to earlier who are so highly educated and highly trained in these multimillion dollar laboratories they simply cannot talk to a marketing guy. A marketing guy to them has his head up his butt.
[00:22:29] He's running around like a damn fool out there in the population trying to sell the drug and, he's talking about brand images and Salesforce projections and sales. And then you bring in the accountants. These business people, they're a totally different group of people.. I used to teach these guys.
[00:22:51] Okay. And those, doctors, those MDs who were pursuing a master of business administration so that they could move up within the pharmaceutical industry and the biggest companies in the world. Okay. The first time I ever talked about price they, thought I was the devil reincarnate. Really? Oh God.
[00:23:16] That, that's not what MOTIVE motivates those guys. Yet, yet the other guys in the classroom who were business trained, finance, accounting, whatever marketing you're asking me specifically they, don't think about that stuff at all. That you tell them about salicylic acid or the, molecular structure of acetyl benzo a and they're gonna go.
[00:23:43] what are you talking about, man?
[00:23:46] Bob Gatty: Exactly. Which is what I would say.
[00:23:50] Hank Laskey: You need people. This is a problem in the optimization of the system. You need people who can talk to both. And those crossover people are few and far between.
[00:24:04] Bob Gatty: Yeah. I can see that . Yeah. Yeah.
[00:24:07] Hank Laskey: So marketing is out there doing its thing with advertising, publicity, personal selling, do not undercut personal selling.
[00:24:17] When, the sales agent for the pharmaceutical company visits the physician and, is granted 10 minutes. Yeah. They go in there and they pitch three drugs. They, pitch the up and comer that they really want to get into the market. They, pitch an old standby that physician knows very well.
[00:24:43] And, then they talk about the hottest drug on the market. Okay. And, you're in the realm of what is called therapeutic product markets. And that is deep within, inside our conceptualization of the economy. When the federal government was asked to maximize the productivity of the American people in order to defeat fascism.
[00:25:12] Okay. They put a, whole plan in place with where they knew they, they went out there and they found where these guys are located, their addresses, everything, the whole system of the United States, and they put it into the Department of Commerce. and you can go there and you can look for where certain chemical process plants are located or certain pill manufacturers are located.
[00:25:43] So the data are there. Yeah. We just don't have the people that are going I, go to the patent office and there might p three or four people in there. They're attorneys, they're, researching some real nitpicky thing, but they can't understand the science by god. Sure You gotta get that stuff in front of the nerds, I call them.
[00:26:09] Yeah. The scientists, the guys have PhDs in molecular biology 20 years ago, and have been doing research ever since. Yeah, okay. They're the ones.
[00:26:20] Bob Gatty: Okay, yeah, I got that. But my question still is, they're spending all this money on these TV ads that we watch and that piss me off. And I know that every cost that's associated with development and selling of a product, whether it's a drug or a car, that all those costs find their way into the price of the product to the consumer.
[00:26:48] Correct? So I'm paying...
[00:26:50] Hank Laskey: We believe that. That's theoretically true. Yeah, Absolutely.
[00:26:56] Bob Gatty: So my point is that I'm sitting there watching a TV show that I like. And, on comes this damn commercial for this skin rash drug. Telling me about how this lady can one little injection every two months or whatever the hell it is.
[00:27:23] And, she's good to go. Oh, that's the other one. There's a there's an ad for an H I V drug. And I know a little about that field cuz I, I helped the association that represents HIV doctors start a magazine. Oh. And I did it for a while. Okay. So I, know a little bit about it and this, ad says one injection every two months I think it is.
[00:28:00] Or every I've heard. Yeah. Yeah And, I'm good. And I'm good to go. He says, . Yeah. Which, to me says to people who are in danger of contracting h HIV, that hey, there's nothing to worry about. If you catch it, you can just get an injection. You'll be good to go. No worries. Yeah.
[00:28:24] That's bad to me. That's bad. That's a bad message. Yeah. But anyway the, fact of the matter is that the cost of those ads, they've got to be paid by somebody. Yeah. And that is going to be you, the consumer, the person who's watching that damn stuff on tv. Isn't that true?
[00:28:43] Hank Laskey: It is true. Think about it from this perspective though.
[00:28:48] Okay. You have to reach an individual who is scattered to the wind across the population, you have to reach them. And you have to know, as you mentioned earlier, before we came on the air, certain key words, certain trigger words. Yep. When, the image on TV does not gel with your image of the world, you're not gonna pay attention.
[00:29:18] But when it does, when the sound is right, the background music is right, the color is right. You need a sophisticated technician to produce this stuff. Yeah. When it's right, the population will see the ad like you do. And they will differentiate themselves into classes of consumers who may or may not want the drug.
[00:29:41] Now, how in the world do we get that drug to them? They've got to go to the doctor. That's another whole thing to advertise about. Sure. You've got to genera, you've got to persuade them. It goes recall key message, comprehension and persuasion. And of course you've got aided recall and unaided recall, and we have those numbers.
[00:30:05] We do, and we can see how many people transition from the advertising in that particular area of the country or world into the doctor's office. We can see an increase in doctor visits. After that, we can see an increase in consumption of the drug. So all that crap has to come first. What I say is, open it up, man.
[00:30:35] Yeah. Just put the drugs on the counter and let the consumers come get what they need or want. You mean without prescriptions? Yeah, because you said that what, country is it? You said a little while ago? Mexico, I think it was. Yeah. Where you can buy prescription drugs without a prescription. Yeah, And it's, there's no problem there. Yeah. People get their information from various sources, like you're, like, you're describing Yeah. And the, information that's pertinent to them, they will learn, they'll say, Hey man, that's for me. I need to go try that stuff. And how, much should I use what's the rate of injection?
[00:31:23] All this stuff. They can get that. Yeah. It's available if, the industry is communicating properly with them. And so then you have this computerized analysis of the problem on the individual, but at some point you need to test that individual and see empirically, objectively, rationally, according to Aristotle.
[00:31:53] You need to know, does the damn thing work in this particular human being? Exactly. And that test is what is critical. Okay. It links together the artificial intelligence world with your body.
[00:32:12] Bob Gatty: Okay. Now, do you watch do, you ever see something called Quora online? No. Q U O R A?
[00:32:20] Hank Laskey: It's oh, I have yeah,
[00:32:24] Bob Gatty: People who know about certain things sign up to be experts and then people ask questions, and then those experts will answer it based on their own personal experience. Okay. . Okay. So anyway, I like it. And, I'm actually one of the experts that they asked to be on there, although I don't think I've ever really responded anything.
[00:32:48] But yesterday I saw this hardly relates.
[00:32:51] Hank Laskey: Why do they keep you , ?
[00:32:54] Bob Gatty: This, I don't get paid. So what the hell? Anyhow, this hardly relates, I guess maybe a little bit to what we're talking about, but I needed to tell you, I need to tell you about this because it's funny as, sure. It's funny as hell.
[00:33:08] All right so, this kid this kid, this eight year old boy and this four year old boy, they go in this drug store. And, they buy a box of tampons.
[00:33:20] Hank Laskey: Okay. . Okay. For their, so for their mother or their wi wife or something?
[00:33:27] Bob Gatty: No, For them. Yeah. So the, pharmacist says, who are those?
[00:33:34] How old are you? And the kid says, I'm eight. And, the pharmacist says you know what these are for? And the kid says my brother here is four years old. . And on TV it says that if you buy these, tampons that you can ride a bike, you can go swimming, you can do all these things. And my little four year old brother doesn't know how to do any of those things.
[00:34:04] So I just thought this would be a good way for him to do that. .
[00:34:09] Hank Laskey: Oh, what a joke, man. . Oh God.
[00:34:13] Bob Gatty: So anyway it's, the message. It points it, yeah.
[00:34:18] Hank Laskey: It points to the issue at hand. Yeah. If these kids see these ads are they gonna be able to buy the product? Tampons? Yeah, they can probably buy the product.
[00:34:29] Right. , oxycodone? I don't think so. They're, yeah. Exactly. But fentanyl is widely available down there, and I was given fentanyl two days ago before I had a steroid injection in my cervical spine. Ooh. So fentanyl is being used and it the, bad press that he gets is destructive.
[00:34:55] All drugs are dangerous at high levels of high dosages. Okay. All pharmaceuticals. Okay. To, think that you can't take too much is insanity. Yeah.
[00:35:10] Bob Gatty: So, are you saying that Fentanyl, I thought fentanyl was just bad.
[00:35:15] Hank Laskey: Oh no, Fentanyl is a wonderful painkiller. Okay. And it, what they did with me yesterday is they, induced a state, or two days ago, they induced a state of Happiness in my body where I didn't know what was going on.
[00:35:35] I didn't even feel that needle going into me.
[00:35:37] Bob Gatty: Is that why you're in such a good mood today?
[00:35:41] Hank Laskey: Probably. You're funny, man. You're funny.
[00:35:43] Bob Gatty: I'm taking some steroids. They put me on yesterday and I've been in a happy mood all day today. .
[00:35:48] Hank Laskey: Isn't that interesting?
[00:35:51] Bob Gatty: Yeah. Prednisone is what it is.
[00:35:54] Hank Laskey: Prednisone, I know the drug very well. Yeah. It's a good drug. It reduces tremors.
[00:36:02] Yeah. It, is it that, and Taine are the only two drugs we have that reduce tremors. A lot of people suffer from tremors older people. Yeah. But they're the only two drugs now. Now think about this. , what is the effectiveness of those drugs for those people? Is it as good as we can get?
[00:36:26] Have we optimized that medicine? And the answer is, we don't know. Yeah. We've got the scientists in the laboratories working on that right now. And trying to come out with better drugs. But combinatorial chemistry was a 50 billion dollar bust, man. The industry spent all this money on combinatorial chemistry and it went down the commode stool.
[00:36:54] It's incredibly expensive to run these laboratories. It's as expensive to run the discovery research as it is the marketing. The marketing and the, those two always compete for each other, with each other for the budget. For the money coming down from the c e o and the cfo and they're always competing for it.
[00:37:18] And the, if the marketing guys run amok there you go. If the scientists run amok there you go. You need somebody who can talk to both, right? Somebody who understands both business and science. And that's what I try to do in my book.
[00:37:35] Bob Gatty: Okay. Yeah. We're gonna get to, your book in a minute. I want you to talk about what you have done with that and who it's intended for and, what information it provides.
[00:37:49] But I have, I had another question that kind of irked me when I was doing research for this discussion. I saw a piece by Pharma yeah, the lobby, the lobbying organization that represents the branded companies in the industry. Yeah. And it said
[00:38:08] Hank Laskey: pharmaceutical research and manufacturers of America.
[00:38:12] Bob Gatty: Correct. Pharma. Pharma. This this, piece claimed that that due to negotiations in the market prices, health plan paid for brand medicines increased by just 1% on average in 2021. And they blamed insurers that other middle men for forcing many of the sickest patients to pay high out of pocket costs.
[00:38:42] Does that make sense to you? Is that true?
[00:38:46] Hank Laskey: It might be. It could be. I don't know the specifics of the situation, but people who were sick. They need a lot of drugs man. And I think to myself, you're 80 something, you're 80 years old, right? Yep. What, the hell you wanna live for?
[00:39:06] What do you wanna accomplish with your life? Oh, that's a big, yeah. What should we leave to these 8 billion people on the planet when we die? Yeah. Elon Musk wants to jump up in the air and never come back. Yeah. That'd be a good, but I tell you buddy, we need the food, sustenance and water that we get here, so that when you increased the number of the amount of drug that goes into one individual, how can it not increase the price? He's taken it from other people.
[00:39:42] Bob Gatty: What do they mean when they, when he said they blame insurers and other middlemen? Yeah. What's that?
[00:39:49] Hank Laskey: At about the same time that direct to consumer came into vogue and legalized, you also had what's called PBMs, pharmacy Benefit Managers.
[00:40:01] Okay. And then, and also Managed Care organizations, MCOs. And these people are a bureaucratic nightmare. Okay. They, were put in place to, to generate formularies, which are lists of drugs that doctors can prescribe from and get paid right now that if you want another drug, the doctor can give it to you, but he won't get paid by the insurance.
[00:40:29] You have to pay 'em. Okay. Yeah. So getting on these formularies is a big deal, man. Okay. And you have these, so these managed care organizations, like here in the, Delaware River Valley, there are five medical schools. They're generating doctors to beat the band. They're all out there at age 30, 35.
[00:40:53] The ladies are pregnant right now. The doctors are, the dermatologist I saw yesterday was pregnant. The babies that are coming on are it's incredible. But ,
[00:41:05] Bob Gatty: The dermatologist was pregnant? Yeah. Okay. And I, I said to her my sister Linda, I hate to talk about her on the air, but she is a, therapist, a social worker .
[00:41:20] She specializes in family dynamics. Okay. And she said to me not too long ago, she said, . If you're gonna live with a man, you're gonna get pregnant. . That was very . Yeah, I guess so. You and I are old enough now to look at it in perspective. Yeah. But when you're young and you're viril and, you see their beauty and they're just gorgeous, look, you want to have them.
[00:41:51] That's right. .
[00:41:53] Hank Laskey: So, what are we gonna, that's what we have to deal with I think ultimately, the number of people and how, we can feed them and care for them with medicines and managed care tries to do that. But it's grown into a, bureaucratic behemoth that's a nightmare. And then you have the pharmacy benefit managers.
[00:42:17] Now these are the guys that interact with the retailer, to tell the retailer how much to charge, what, where to get the drug their, warehouses, full of drugs, every kind of drug you can imagine. And they have to be picked and put into a truck and taken into the local cvs, right? Those people are absorbing an enormous amount of cost, inventorying those drugs.
[00:42:47] Cost is everywhere, man.
[00:42:50] Bob Gatty: Oh, that's a really good point. Hank, I hadn't thought about that, but all of those costs that deal with filling the supply and, managing the warehouse and yeah. Getting, the drugs to the drug stores.
[00:43:09] Hank Laskey: The way now that's after it's been discovered in a research laboratory where those guys are paid $200,000 a year with benefits, pensions, et cetera.
[00:43:20] Yeah. They're highly, educated and they are, they come up with a drug candidate and it goes to market. Then you need somebody to transition to the marketing people and say, look, this is what this drug will do in a very practical sort of way. Okay. In 90 seconds or less is what they tell the salespeople.
[00:43:41] Bob Gatty: Yeah. Yeah. So you guys that are listening to this, you need to, you do, you need to understand that you complain about the cost of the drug and you think, oh, it's the drug company. They're just a bunch of greedy sons of bitches. No. Which is it's yeah But, the fact of the matter is it's, a hugely complex industry and there are costs everywhere that now maybe some of these costs can be alleviated by streamlining things.
[00:44:15] You were talking a little bit ago about, about that. Perhaps perhaps yes, I, yes but nevertheless it, there's more that to it than just the
[00:44:33] Hank Laskey: All that inventory management, the managed care organizations, the pharmacy benefit managers. Yeah. Don't forget discovery research and all that comes sort of underneath and beneath the guidance of marketing. Marketing tries to manage the whole thing. Ah, it belongs in the hands of marketing. Channels of distribution. That's a marketing issue. We teach that in marketing. 3 0 1. Channels of distribution, logistics, trucking. Ships, planes. A lot of drugs have to be brought in by airplane.
[00:45:14] They've got a shelf life. and that airplane costs money. Sure. I don't know if, I don't know if you've tried to fly anywhere lately, but it's expensive. Yeah, I know. And yeah and, the freight planes that run from here to the islands and then jump over to Africa or whatever because of the Jones Act, which restricts shipping from in, into the territories of the United States and out of the territories of the United States there, it's a morass of problems.
[00:45:47] It's got no simple answer. Yeah. But computers, artificial intelligence, well-written code, thoughtful people who can think of both the marketing and the discovery side and can communicate with both that those are the people we need. We need those people desperately. So if you're thinking about entering the industry, if you're in the industry already or a related industry and you wanna move up and over in the system, this is the kind of stuff you need to get hip with, is how to talk to both.
[00:46:27] Okay. Science and marketing. Okay. And accounting and of course, and finance and all the rest biology. Okay.
[00:46:37] Bob Gatty: All right. I wanted to go there. I wanted to talk a little bit about about your book and, the career opportunities that you just described, and what people need to do to take advantage of those opportunities.
[00:46:54] You want to take us there?
[00:46:56] Hank Laskey: I, think the most effective thing for people to do is just go to the Pfizer website, P f i z e r.com and look at the job openings there are in the largest pharmaceutical company in the world. Okay? You better know what you're doing, so you need some education before you go talk to those people.
[00:47:19] And that's what my book is intended to do. But once you get in there, you're gonna make a lot of money, man. But you're gonna have people watching you like a hawk, and everybody is, and there is either, what's in it from me? Are, you that kind of a person? What's in it from me? Or are you a cooperator?
[00:47:42] Are you somebody who likes teamwork, feels good in teams and, shares information and processes with the group. Now that's a team. . And we know that teams exist about five members or six, and then it gets to be too big. Then you lose that interpersonal thing that occurs inside a team. And these are the, people that make decisions.
[00:48:10] Bob Gatty: Is this a good industry to be in?
[00:48:14] Hank Laskey: Oh God, yes. Why? Oh God yes. Tell me why. It's very profitable. Yeah. Very, profitable. Wonderful salaries. The, retirement plans that blow your socks off. Very, The stock options and stock grants that are given. Paul Volker of the Federal Reserve Board he was the chairman of the Federal Reserve Board some time ago.
[00:48:39] He advocated for this stuff almost his whole life. And they put it into place. And what it basically does is it, motivates the, employee to help the company and other employees get their job done. Okay. Make it work. Uhhuh , but somebody has to coordinate that, that when you talk to programmers, artificial intelligence programmers who are writing the code, that code is critical.
[00:49:14] Man, you better tell them the right stuff to put in there. Because ultimately you're gonna have that test of the human being. And that test of the biological material is going to go way up into an artificial intelligence paradigm that's going to come out with, we hope, a diagnosis and, a prescription that does not require a physician.
[00:49:41] Bob Gatty: Yeah. Now, Hank, in addition to the financial benefits offered in this industry. Yeah. Is that satisfying work, do you think?
[00:49:53] Hank Laskey: That's very interesting for, people that are team players. It is wonderful, wonderfully satisfying to see people who are sick in mass and to, give them what they need to see them happy and fit, and doing productive work.
[00:50:17] Oh baby, that's satisfying, man. To me it is. Because I value life. And, that's why I think about life on this planet after we, you and I are dead and gone. Yeah. What are we gonna leave to those people? Yeah. We have so much intelligence it's in our people. If we can just get 'em to work together and cooperate. Is there almost an instinctive urge to cooperate with the, excuse me, now, the Lord God yahk under his guidance, or Buddha or, the Shinto gods of the mountains and the earth. You almost get into the realm of, economic geography there. And you're gonna start talking about Chinese transition elements and how they can catalyze certain biological reactions and not get involved themselves, but make two things, come together, get catalyzed.
[00:51:29] That's wonderful stuff that takes place in the body. Okay. Your hemoglobin and the different chemicals that are made in your body. That's why sugar is so disgusting, like terrible. It just reeks of a havoc on your body. You need a slim trim fit self. And, people look at the fat people around, man. They're everywhere.
[00:52:00] Bob Gatty: I know . I know. I have a fat doctor. Seems like a contradiction in terms to me.
[00:52:07] I'm gonna let you go. We've been on this now for 55 minutes.
[00:52:12] Hank Laskey: Okay. But I'd like to do it again. I've enjoyed it very much.
[00:52:16] Bob Gatty: Oh, we can do it again. Hell yeah, sure. I do wanna ask you just one last thing though. Okay.
[00:52:24] Why should people buy your book?
[00:52:27] Hank Laskey: It provides a very broad examination of the industry. Okay. From the economic principles that most fundamentally guide the industry to the science, the medicine. And I've got a lot of history in there. I've got regulation, government regulation in the United States, A very serious description of it and discussion.
[00:52:52] Yeah. Also in the eu, the enterprise directorate general in the eu. And the whole regulation system there. And then of course, in Japan as well. Okay. With the local prefect.. So regulation of this industry which, only is in three areas of the world, and there's heavy regulation in all three of them.
[00:53:15] So we've got to know the regulation and the book talks about that. Okay. Then it talks about the history of, the one I love the most is in the middle of the book where I talk about Jean Claude okay? And this, wonderful pharmaceutical company that he created in France, which became the second largest pharmaceutical company in France, which is quite something to say.
[00:53:42] And when he died he, was an aviator man. He knew all about aviation, helicopters, planes. He flew his helicopter in the side of a mountain. Yeah. Then what happened? Okay. , his family, it always goes through a family first. The Pfizer cousins, the lily brothers, it always goes through a family first, before it goes public, before it becomes a stock holding equity, holding.
[00:54:18] It's diffused through a family. What happened when Jean Claude died? They sold their shares so fast you couldn't catch 'em. Yeah. Would they sell 'em to a German company? Of course. On the other side of the Rhine. Yeah. Yeah. They, and there you have a massive industrial infrastructure. Okay.
[00:54:44] And it took over, man. Okay. Alright. All right. So now what, did I just say? I just said the control of the second largest pharmaceutical company in France. Was sold to another country. Yeah. That's a big structural change now. Sure. Yeah. And when that happens, every single time somebody dies in, that owns a lot of shares, Uhhuh you're, gonna look at Elon Musk selling shares to beat the band.
[00:55:16] It's the same thing.
[00:55:17] Bob Gatty: Yeah. Is that guy crazy or what?
[00:55:21] Hank Laskey: I think he's a genius. I really do. Do you? Yeah. Yeah. Yeah. But he's, half caught to some I love,
[00:55:29] Bob Gatty: I don't understand what his thing is with Twitter. I really don't . I don't either. Yeah. Where'd that go? Yeah. Anyway, let's get back to you of the book.
[00:55:40] Where can people, get your book? Oh, they can get it on Amazon. It costs about 25 or $35 on Amazon. Oh yeah. The historical development. Sometimes I go back to the hit heights. in ancient Israel. Why? Because that language is the language we all speak. Okay? That's Indo-European language, okay?
[00:56:07] And all the languages of Western Europe are Indo-European languages, right? So two are those of the northern section of the Middle East. So when you go to another country and you are faced with their language you should think in these terms that there are certain similarities that stem from inter European languages that, that, can be of great assistance.
[00:56:39] Language is a big deal. Listen, to this one. You have people who translate foreign works into English. And we read them and we think, wow, this represents a, line of thought, a major line of thought in another country. But no, that particular translator likes that particular author. Where do you find translators who are as knowledgeable about the science as they are about anything else for that matter?
[00:57:18] Okay. It's tough. The whole thing is tough, man.
[00:57:22] Okay. Now for people to purchase your book, they need the title. Yeah, the title is a Real page Turner. I have to tell you. , I made that up one night, man. , the global pharmaceutical industry, colon economic structure, government regulation and history. Yeah.
[00:57:48] Okay, now that sounds like something that I would read when I need to fall asleep and I can't. So tell me why it's not
[00:57:58] Hank Laskey: people who have read it who are friends of mine? Yeah. The ex Dean of a College of Business and Pharmaceutical and Chemical Studies. Yeah. His response was, you cover a lot of things in this book, Uhhuh
[00:58:14] You cover management, you cover economics. Of course, you cover the science and what have you. You cover the regulation. He said, there is so much stuff in this book. I don't know if people can absorb it all. Yeah. So I have talked to others who are not as educated, but I've given them the book and they get hung up on the economics.
[00:58:38] They can't get past that chapter when, I talk about the value of the dollar and how many dollars countries on the other side have to pay us to get the drugs because their currency isn't worth much at the moment. He just said that he found that so interesting. He'd never thought about money like that before and he wanted to talk about that.
[00:59:10] I wanted to say, that's a fact. Let's move on. Okay. Let's see where that gets us. Okay. So if you assume that any man. Or human, or any corporate entity of any sort, whether it's a an S type corporation or an llc or a partnership, whatever. If you assume that anybody who has an enforceable right to a product or service, they will do what is ever in their power to maintain and increase the value of that whatever it is as service
[00:59:51] Bob Gatty: All right. This has been a great conversation. Hank, I really appreciate you coming on the Lean to the left with us today. And I, you guys listen,
[01:00:01] Hank Laskey: I hope I'd leaned enough to the left for,
[01:00:03] Bob Gatty: oh, hell, you know what? This wasn't a political discussion at all, but it's about a topic that everyone Everyone, I don't care whether you're Republican, Democrat, whatever you are, you're a human being and you have to deal with your health and with, and with that comes dealing with the pharmaceutical industry.
[01:00:25] Yeah. And and so it's important for everyone, and it is, and Hank, I really do appreciate the work that you've done in, sharing your insights with us today. So thank you so much.
[01:00:39] Hank Laskey: Let me just say very, finally I, appreciate you very much asking me on and giving me the opportunity to talk to you.
[01:00:48] It's, just a wonderful service that you're providing to your listeners. Thank you. Yeah. And, it took me 15 years to write this book. Wow. . Yeah. After I got my PhD, after I wrote my dissertation, after I published three dozen articles in referee journal articles. Around the world.
[01:01:13] Then I decided to get serious and write this book, . I'd been collecting data for years and years and it was scattered all over my computer. Yeah. And my, wife comes cruising by one day and she says, why don't you just write a book with all that stuff, . And that was the motivation Rachel told me to do it.
[01:01:34] Yeah. , happy wife, happy life, man.
[01:01:37] Bob Gatty: Should have done that a long time ago.
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