Will the Pandemic Save Big Pharma’s Reputation?
WHY YOU SHOULD CARE
The search for a cure may also be the solution to Big Pharma's image problem.
Big Pharma has been a punching bag for some years now, including through two presidential elections — and not without reason. Its role in fueling the opioid epidemic combined with copious examples of price gouging have become too bitter a pill for many Americans to swallow.
But as the coronavirus rages, reshaping society and devastating the economy, pharma giants are seeing gains — in stocks and in a surprising shift in public opinion. Gilead Sciences, primarily known for its antivirals treating HIV and hepatitis, has seen its stock go up as Wall Street and Main Street alike watch to see if its drug Remdesivir could be the fix to get us back out of our homes again.
This virus has caused public change at a pace that we’ve just never seen before.
Jarrett Lewis, health care expert
It’s the same for drug developer Moderna Therapeutics, which has received $483 million to help create a coronavirus vaccine, and for blue chip distributors like Merck, Pfizer and Eli Lilly. It’s not just brokers that are bullish: 4 in 10 Americans say they now have a more favorable image of the pharmaceutical industry, while 6 in 10 believe providers and pill makers should lead the way in providing solutions, according to a national survey by the Harris polling group in March.
Globally, new polling from Ipsos shows that a vast majority of respondents in Spain (76 percent), France (72 percent), Italy (68 percent), U.K. (67 percent), Russia and Japan (both 64 percent) feel a quick economic recovery is not on the cards — numbers that experts say will likely change only once a vaccine hits the market.
And so it’s worth wondering: Is Big Pharma finally breaking free of its bad boy image? “As somebody who does this for a living at a 30-year-old firm, this virus has caused public change at a pace that we’ve just never seen before,” says Jarrett Lewis, a health care expert and partner at Public Opinion Strategies.
It’s hard not to see how pharmaceutical companies have benefited, reputation wise, from the current crisis. More Americans than ever are acutely aware of the work they do, sometimes tracking it on an hour by hour basis, stretching their vocabulary as words like “hydroxycholoroquine” enter the daily discussion (and are muttered in White House press briefings by the president himself). Searches for “viral vaccines” are up 1,500 percent from late March to late April, according to Google Trends. People are talking about them, and, for once in recent history, it’s not a bad thing.
(U.S. deaths from COVID-19 (red line), compared to American losses in modern wars.)
Plus, Americans will most likely need to turn to pharmaceuticals more than ever — both now, and in the virus aftermath. Many essential (but not life-threatening) medical procedures are being put off due to over-burdened hospitals, all but ensuring that more drugs will be needed to dull the pain in the meantime. And health practitioners are already reporting increased mental health concerns in this period of isolation due to social distancing, driving up demand for both tele-health solutions and likely increasing interest in pharmaceutical remedies even once the worst is behind us.
To be sure, Big Pharma will have an uphill road to climb should they want to make this perception shift permanent. As recently as August, the pharmaceutical industry was the most disliked industry in America — 58 percent of those polled in a Gallup survey had unfavorable views of it, roughly twice those with favorable ones. The issue of exorbitant drug prices has been put on the back burner, Lewis points out, but as the economic recession wears on, it very well could become a major talking point once more.
Perhaps the answer to whether this goodwill can last will depend on who, exactly, comes up with the coronavirus remedy that gets the world back on its feet. “You have Big Pharma, and then you have the smaller biotech firms,” says Karim Galil, founder and CEO of Mendel, an AI-based research engine which just released a COVID-19 program designed to help scientists find a cure by searching studies faster.
In his view, the smaller startups are better equipped to handle a problem like this — one that will require a fast solution, using innovative ideas and decisions made at breakneck speeds. “With Big Pharma, even in a pandemic, it’s just an elephant. With them, finding any solution takes forever.” Take India, whose pharma giants produce 40 percent of the generic drugs consumed in America. Most of the six Indian firms racing to develop a vaccine for the coronavirus are startups.
Smaller firms also are incentivized to find a patentable cure … rather than discovering a new use for a generic drug already on the market and publicly available. “That’s not the lucrative thing for Big Pharma,” he says. If Big Pharma can’t find the cure, it will cut directly against their primary argument for high drug prices and special patent protection — that those are necessary to fund the research and development required to provide life-saving medicine.
Still, aspects of this perception shift seem to be long-lasting. “We’re not at the tail end of this as an issue, but we are in the later innings in terms of opinions moving,” Lewis says. Industry lobbyist APCO Worldwide says its polling also suggests an improvement in the public perceptions of the pharma sector.
The fact that Americans are realizing the long and arduous process of creating a vaccine (as long as 18 months while conducting clinical trials and meeting regulatory approval) is likely to underscore how difficult taking a drug to market can be for the companies involved. Big Pharma might finally have convinced the world of what it has been saying for years — that all the expense is really worth it. But it’ll need to beat the smaller guys to a cure first.