The Profit Motive Behind Your Prescriptions

Pick an industry - oil, music, retail, tech - they’re all driven by profit motive. Nobody thinks that’s controversial. It’s an economic incentive. I’ll go a step further; Public companies are legally required to maximize profits for shareholders. It’s called a fiduciary responsibility to act in the best interest of the corporation and its shareholders.

Now extend that same profit motive to the food industry. Still not overly controversial, but some people start raising objections, ready to defend their preferred diet. “All food producers are driven by profit.”; “Yea, but I eat this way for the good of the planet.”; “You’re just creating a narrative around how you want to eat.” (True; Very few people have considered the full planetary impact of their dietary choices; I have biases and I do my best to challenge them in all of my research).

The Value-Add Framework

Trying to disentangle the intricate web of profit motive in the food industry will drive the most dedicated investigative journalist crazy, so here’s my first guideline: How much “value-add” can a company claim when selling you a product?

Buying eggs? There’s not much difference between egg A and egg B. The process of getting an egg to you doesn’t leave the producer with many steps to add cost and ‘mark up’ prices. Too expensive and I’ll choose the next carton over. Mark up your boujee pasture-raised eggs too high and I’ll choose the other boujee pasture-raised eggs. Farmers need profits to stay in business, but there are very few steps in getting eggs to market that justify high profit margins.

Buying broccoli? If it’s fresh and well-priced, I’ll buy it. Organic and I’ll pay a slight premium.

But that ‘High Protein-Low Carb-All-Natural-Cancer Beating-Miracle Drug-Meal Replacement Quest Energy Bar’ with a dictionary for an ingredient label? Now that’s a product that I can sell you a thousand value-adds. Look at how convenient, how healthy and how planet saving Quest has made nutrition and sustenance for you! Each one of those manufacturing steps to process materials into whatever the hell is in that bar is an opportunity for Quest to pad the price of the bar and add profit margin. All Quest has to do is employ a marketing department to convince you that Quest is better than Clif Bar. (FYI Quest was bought by Simply Good Foods, a public company, in 2019 for $1 Billion). Branding carries immense profits.

Broccoli, Beef, and Quest all make profits by selling you their products. One difference is the scale of the profits and the ability of a company to sell you on why their product is superior to all the competition.

Why does this matter? The bigger the profits, the more money an industry has to spend on research and lobbying. That shows up in what research gets funding, what results are published, and what gets emphasized in official nutrition guidelines. We’ll leave a deeper analysis for another day.

Moving on from food, now let’s apply profit (and legal) motives to the health and medical industry. Extend the exact same profit framework to medicine, and suddenly I’ve crossed the conspiratorial crazy line.

I understand the resistance. I truly believe that most doctors do what they do in large part to help people. Most individuals working in medicine are morally good people, and I’m personally great friends with some. But take a step back and consider that these amazing doctors and nurses are working in a for-profit industry that, like any other industry, is designed to maximize profits. And Holy Bozonkers does the medical industry rake in profits.

The Pharmaceutical Development Machine

Pharmaceutical companies in particular are an easy punching bag (It’s ok, they have enough padding from $100 bills that they won’t feel a thing). Getting a drug to market requires extensive and expensive testing. There are many phases to testing the safety and efficacy of drugs, and each round is a financial burden. There’s always a danger of discovering unforeseen health side effects that squash the drug entirely, rendering millions of dollars wasted.

That means the drug company doesn’t want to ensure the drug is safe - they want to pass the minimum legal requirement for testing while not finding too significant of side effects. Read that again, because it’s vitally important. Drug companies do not want to discover anything that will nix their drug. That’s very different from proving safety.

On the flipside, a drug must be “effective enough” to make it to market. But the rules about what constitutes effective are quite vague and imprecise. Does a drug have to benefit 1 out of 2 or 1 out 10,000 people treated? Would that have an impact on your decision to take the drug? How often are you even told how effective a drug is?

For those without a prior heart attack, the Number Needed to Treat with a statin to prevent a single heart attack over 5 years is approximately 250 people. That’s good enough to allow the most prescribed class of drug on the market.

The Sales Machine

At this point the drug company has poured millions of dollars into drug development and testing, hasn’t admitted to finding anything that would nix the drug therefore wasting those millions, and can show evidence of the drug helping a few people improve a number on their blood test.

Now the drug company needs to sell this drug to recuperate their investment and make enough profit to satisfy shareholders. How? Advertising and lobbying is a great place to start. How does an executive at a for-profit industry increase profits? Option One: On a patented drug with minimal competition, they can increase the price per unit. The price increase is obfuscated via the monstrosity that is our for-profit health insurance industry. Option Two: Once option one is exhausted, Option Two is to increase the number of customers. ‘Look, we have a drug that passed all regulatory checkpoints and is proven to help a few people. We need to make that standard of care for everybody!’

We have an industry that makes enough profit to spend $300 Million a year just on lobbying our politicians for favorable legal treatment. Maybe some of that expense leads to ‘Standard of Care’ that isn’t fully scientifically rigorous?

Under the beautiful PR guise of helping people, the pharma executive has carried out his fiduciary duty to maximize shareholder profits.

Taking a Step Back

Time for a deep breath. Some drugs do benefit some people, and I am grateful for modern medicine. The economic system I just outlined probably does help bring lifesaving drugs to the market faster than other systems would. Nothing is ever fully good nor fully bad.

My contention is that the economic machine - capsized by lobbying and easily swayed by the emotions we feel about helping people feel better - has guided the medical behemoth and the extraordinary doctors employed within it to massive over-prescription of pharmaceutical drugs.

Where is my bias?

I believe that so many of the symptoms of chronic diseases mass-treated by drugs can easily be resolved by fixing the root cause with food and lifestyle. And food and lifestyle aren’t accompanied by so many negative side effects. My bias comes from my research and from my experience helping my clients do exactly that. I know it’s possible because I experience it regularly.

Some people, after addressing food and lifestyle, still struggle with health concerns. For those people Big Pharma is a literal life-saver. For most people, simple dietary changes are the miracle they’ve been looking for.

Embrace Nuance,

Alex