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Saturday, April 17, 2004::

Antitrust News: When is one man's need . . . 

. . . a mortgage on the life of another? Apparently, when you are infected with HIV. Consider this press release from the AIDS Healthcare Foundation:

LOS ANGELES, APRIL 16, 2004 -- A broad coalition of AIDS advocates and patients will come together in protest over Abbott Laboratories' recent unprecedented 400% price hike on Norvir (ritonavir), their key AIDS drug. The activists and AIDS advocates will hold a 34-hour vigil and protest in front of Abbott's South Pasadena site (820 S. Mission Street). AIDS Healthcare Foundation (AHF), the Southern California HIV Advocacy Coalition (SCHAC), Bienestar, Whittier Rio Hondo AIDS Project (WRHAP) and many individual AIDS activists and patients will join in this vigil. In addition, the Organization of HIV Healthcare Providers, nationwide group of doctors & providers, has lent their support.

Abbott's price hike has prompted an unprecedented outcry from AIDS advocates nationwide, and led to other protests and boycotts of the company by activists and physician groups. This in turn prompted the opening of antitrust investigations by the Attorneys General in Illinois and New York, as well as government hearings on Abbott's actions by the Department of Health and Human Services (HHS) and the National Institutes of Health in Washington, and gave rise to the filing of private antitrust and false advertising lawsuits against Abbott by AHF.

In addition, overburdened and under-funded state Medicaid programs such as Medi-Cal, may be adversely affected by this huge price increase. To date, Abbott has been unwilling or unable to publicly explain how, if at all, this price hike will not affect such Medicaid programs in cash strapped states like California.
Heaven save us if a private business cannot explain how overburdened and under-funded government programs are to endure the free market.

I visited Abbott Laboratories' website to see what the company had to say about this controversy. In one of several press releases, the company wrote:

Norvar plays a central role in the treatment of HIV. While the number of patients receiving Norvar as a booting agent has grown over time, there has been a steady decline in sales due to the significant reduction in dose, with the majority of patients taking 100 mg daily, as opposed to the initial 1200 mg daily. At the same time, the value of Norvar to patients with HIV has increased significantly. Abbott has taken this re-pricing step with Norvar in order to come to terms with these economic realities, while others have addressed thought premium pricing of their new drugs.
Abbott also states that it is not changing the price for AIDS drug assistance programs and has expanded its patient assistance program so patents without drug coverage can receive Norvar for free.

The largest cost for many medicines is the price of their development. Abbott faces a considerable economic challenge because of the dosage reduction for Norvar; clearly, its previous economic models for recouping its investment in Norvar no longer hold water. But to claim that Abbott has a responsibility to keep its medicines at the same price, even if it results in Abbott having to forfeit its profits for a drug that keeps people alive, means that Abbott employees and shareholders do not live and work for their own sake, but instead live and work for the sake of others. The AIDS coalition and government regulators are questioning Abbott's ethics, but I question theirs: by what right to they have to demand that Abbott sacrifice its interests so they can pursue their own?

The most-repeated claim in debates such as this is that because Abbott produces a life-saving medicine, the trader principle of mutual exchange for mutual benefit breaks down; if Abbott's customers do not receive their medicine, they will die. By that standard, the whole world becomes slave to the needs of others. Why is medicine different from other needs such as food, or housing? Why is the first question always how a price hike will affect Medicaid programs in cash strapped California, and not how coercion in the marketplace will affect the lives of producers who create live-giving medicines?

Still, the most troubling issue in my mind is Abbott's response. Abbott has defended itself, but only thinly and vaguely. I had to hunt for the pull quote I used above, yet it is the fundamental statement on the issue. Abbott relies mostly on terms that attempt to show that it is not "heartless," such as its programs to provide its drugs to the needy for free. Yet isn't it the AIDS coalition's point that all those affected with HIV are needy?

Abbott would be better served by refuting its critics at the heart of their claim. There will always be those who attempt to loot their neighbor, but the key is in the response. Abbott should proudly state that it exists to return a profit and that it will not sacrifice itself to anyone--that it exists to save the lives of its customers, for the sake of its investors. Yet I suspect Abbott's leaders would be reluctant to defend themselves in such principled terms; given my long experience with antitrust enforcement in the heath-care industry, I am all but sure of it. The profit-motive is a dirty part of doing business, not something that should be defended proudly and without compromise.

Yet when critics damn corporations such as Abbott for "putting profits ahead of people," they really damn the self-interest of people. For these crtics, life is a hospital, and man's life mission is not the pursuit of his own happiness, but the alleviation of suffering of others. It would be refreshing to see, in response, the genius that creates things such as breakthrough medicines applied with the same intensity in defending the very motives that make such breakthroughs possible.

::: posted by Nicholas Provenzo at 12:43 PM | donate | link | |

Thursday, April 15, 2004::

The War: The Fruits of Appeasement 

Victor Davis Hanson understands the war against militant Islam (hat tip: Ben Rathbone).

Imagine a different November 4, 1979, in Teheran. Shortly after Iranian terrorists storm the American embassy and take some 90 American hostages, President Jimmy Carter announces that Islamic fundamentalism is not a legitimate response to the excess of the Shah but a new and dangerous fascism that threatens all that liberal society holds dear. And then he issues an ultimatum to Teheran’s leaders: Release the captives or face a devastating military response.

When that demand is not met, instead of freezing Iran’s assets, stopping the importation of its oil, or seeking support at the UN, Carter orders an immediate blockade of the country, followed by promises to bomb, first, all of its major military assets, and then its main government buildings and residences of its ruling mullocracy. The Ayatollah Khomeini may well have called his bluff; we may well have tragically lost the hostages (151 fewer American lives than the Iranian-backed Hezbollah would take four years later in a single day in Lebanon). And there may well have been the sort of chaos in Teheran that we now witness in Baghdad. But we would have seen it all in 1979—and not in 2001, after almost a quarter-century of continuous Middle East terrorism, culminating in the mass murder of 3,000 Americans and the leveling of the World Trade Center.
Read the whole essay.

::: posted by Nicholas Provenzo at 12:01 AM | donate | link | |

Wednesday, April 14, 2004::

The War: The Spirit of America 

The Marines are asking for donations so they can challenge the anti-American propaganga in Iraq:

Help U.S. Marines Equip TV Stations in Iraq

Support an alternative information source in the "Sunni Triangle."

News broadcasts in Iraq can be biased, inaccurate and incomplete - to put it mildly. Your contribution will create a television alternative owned and operated by Iraqis. This will provide better information, counter efforts to provoke and help reduce tensions.

$1,950 purchases a PC for editing video and programming
$538 buys a digital video camcorder
$109 provides a multi-region DVD player

Any amount helps! [Spirit of America]
Maj. Gen. James Mattis then makes the following statement:

It is essential to success of the Marine Corps' mission in Iraq that the Iraqi people understand our sincerest desires to help them rebuild their country and lay the foundation for a viable and free democratic society.

Your (Spirit of America) gifts will reduce adversarial relationships and bridge cultural gaps. You have significantly impacted our ability to do good and, I fervently hope reduce the potential for combat.
So according to Mattis, the Iraqi people are simply poorly informed and culturally misunderstood. Yet the Iraqi people have never been bothered by patently false and misleading information before (consider the spectacle of the Saddam’s information minister). The only thing the Iraqi people have shown themselves to respect is brute force. And in this regard, the US must be willing to supply it in spades.

Imagine if the Union army took Mattis’ stance toward the South during the American Civil War. Imagine if Sherman’s Atlanta campaign, instead of crushing the will of the Southern rebels to fight the war, focused on performing acts of “compassion” for the South, so the Confederates would see that the Union was only interested in “a viable and free democratic society.” Then imagine not living in America as it exists today, because under such tactics, the Confederacy would never have been defeated.

I am reminded of Sherman’s response to the Mayor of Atlanta demanding Sherman spare Atlanta after he had ordered civilians to flee the city:

You cannot qualify war in harsher terms than I will. War is cruelty, and you cannot refine it; and those who brought war into our country deserve all the curses and maledictions a people can pour out. I know I had no hand in making this war, and I know I will make more sacrifices to-day than any of you to secure peace. But you cannot have peace and a division of our country. If the United States submits to a division now, it will not stop, but will go on until we reap the fate of Mexico, which is eternal war. The United States does and must assert its authority, wherever it once had power; for, if it relaxes one bit to pressure, it is gone, and I believe that such is the national feeling. This feeling assumes various shapes, but always comes back to that of Union. Once admit the Union, once more acknowledge the authority of the national Government, and, instead of devoting your houses and streets and roads to the dread uses of war, I and this army become at once your protectors and supporters, shielding you from danger, let it come from what quarter it may. I know that a few individuals cannot resist a torrent of error and passion, such as swept the South into rebellion, but you can point out, so that we may know those who desire a government, and those who insist on war and its desolation.

You might as well appeal against the thunder-storm as against these terrible hardships of war. They are inevitable, and the only way the people of Atlanta can hope once more to live in peace and quiet at home, is to stop the war, which can only be done by admitting that it began in error and is perpetuated in pride.
Maj. Gen. Mattis would do well to focus his mission on destroying the intransigent pride of the Iraqi insurgents. As I was taught when I was a Marine, Marines today must locate, close with and destroy the enemy, not coddle him. It will not be a new TV network that prevents Marines from being killed in Iraq. It will be the sure knowledge that any act of force committed by those acting against the United States will result in individual ruin. Lincoln, Grant and Sherman knew it when they fount the South. It is high time our leaders accept the same lesson.

::: posted by Nicholas Provenzo at 12:58 PM | donate | link | |

Tuesday, April 13, 2004::

The Culture: Sunday! 

Sunday!: A Monster Truck rally is the annihilation of the everyday by overpowering technology. And to think you scoffed when CAC got its Monster Truck.

::: posted by Nicholas Provenzo at 7:57 AM | donate | link | |

The War: Defense Science Board Calls for Low-Yield Nuclear Weapons 

It seems the Pentagon wants low-yield nuclear weapons. Consider this excerpt from the Defense Science Board's Report on Future Strategic Strike Forces:

Over a decade ago, new nuclear weapons production ended. Plutonium fabrication--a key requirement for making nuclear weapons--came to an abrupt halt when Rocky Flats shut down in 1989 and is just now planned to be restored at very modest levels. Nuclear testing stopped in 1992 and the U.S. continues to observe a testing moratorium. A sense of "nuclear drift" characterized the early post-Cold War period, with falling budgets, personnel upheavals, no clear mission for the nuclear complex, and the like. . . .

. . . The current vision for the nuclear stockpile is focused on refurbishing legacy nuclear weapons from the Cold War, and modifying some to lower yield. What has been severely curtailed, however, is work to push the envelope in nuclear design. For deterrence to be effective, we at a minimum must be seen as having the capability to destroy what an adversary values most, as well as having the will to use this capability. We join others in judging that a credible force should include, for ex-ample, some nuclear weapons that cause much less collateral damage to achieve their desired effects against the highest priority targets. The problem is that the current plan embedded in the SSP consumes virtually all available resources simply to sustain the aging stockpile of declining relevance. The sole exception is the proposed Robust Nuclear Earth Penetrator (RNEP), including the low-yield options, which is a step in the right direction. . .

. . . We envision a future nuclear stockpile that retains (1) some legacy weapons (by which we mean the high-yield weapons that were designed for the Cold War threat), (2) some legacy weapons modified for lower yields, and (3) some number of new weapons based on previously tested nuclear devices and designs. Currently the plan is almost exclusively oriented toward refurbishing the legacy weapons through life-extension programs and the more recent RNEP activity. We would significantly scale back on the former effort in order to shift focus, and free up resources, for acquiring weapons based on previously tested devices and designs that have quite different characteristics than the legacy weapons: lower yields, special effects (all with greatly reduced fission yield), robust performance margins, and ease of manufacture and maintenance under today’s conditions.
In short, the board wants practical nuclear weapons for use against today's threats.

Although the Defense Science Board's does not make radical calls (the board did not recommend the US withdraw from the nuclear test ban treaty), it is refreshing to see it address a long neglected fact: the US's current nuclear arsenal does not deter everyone, and against those enemies, the US needs more advanced and precise ways to strike.

Not everyone is pleased with the Defense Science Board's newfound determination. According to one news report:

"Pre-emptive nuclear war, that's what they're pushing, and it's absolute madness," said Bob Peurifoy, a former Sandia National Laboratories weapons manager. "Nuclear weapons are the absolute weapons of last resort. If we're losing American cities, then we should respond (with nuclear strikes). Short of that, I can't see any use of weapons with any nuclear yield, I don't care how low."
Madness? Hardly. Allowing terror states like North Korea and Iran to arm themselves with nuclear weapons because the US did not have the right deterrent that could destroy the nuclear facilities of each is the real madness.

::: posted by Nicholas Provenzo at 12:01 AM | donate | link | |

 

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