Zika Crisis Stresses Need for Pharma Industry

Sander Flaum is principal of Flaum Navigators.
Sander Flaum is principal of Flaum Navigators.

Do police departments and phar­maceutical companies have anything in common? Correct: Both are routinely vilified until a crisis occurs.

Case in point? By now every­­one is aware that the Zika virus — spread initially by mosquitoes (and apparently via sexual contact later) — causes few symptoms and resolves quickly unless it infects a pregnant woman, when there's a significant chance that her child will be born with a damaged brain.

No surprise, suddenly we're hearing demands for pharma to come to the rescue, as we had earlier about Ebola, HIV, avian flu ... as we always hear about cancer. Predictably, biotech and pharma are doing what they do best — pouring millions into research. The approaches are many. For example, look at Intrexon Pharmaceuticals' novel angle.

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Betting it might fight Zika with a safer mosquito, last year the biotech spent $160 million to buy Oxitec, a British company that can genetically modify male mosquitoes with a lethality gene. The premise is that when a modified mosquito mates with a disease-transmitting female, their progeny will die before becoming adults.

If this “vector control” approach proves successful, it may slow — even halt — the spreads of Zika and another nasty virus, Dengue fever. Intrexon is now gearing up to produce 60 million modified mosquitoes a week for use in Brazil. Although Zika is not an epidemic in the U.S., the FDA has given tentative approval for a test in Florida.

Intrexon's gamble is but one approach to address the problem. According to Zacks Investment Research, Inovio Pharmaceuticals is working on a DNA-based vaccine, which is typically easier to test (and to gain FDA approval for) than a vaccine based on live virus. Inovio, Intrexon, and their competitors are all making huge bets with very uncertain payoffs. Last year Inovio lost $11 million in the endeavor's first nine months. Intrexon lost $84.5 million last year.

Are they spurred on by healthy competition? You be the judge. But that fact will go unheeded. In a year or two the specter of Zika will be behind us. And once again we'll be swamped by a tsunami of bellyaching about how pharma is ripping off the world's healthcare systems. You can almost see the editorials now: “Outrageous! How can anyone charge $7.5 million for a bunch of mosquitoes?”

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After delivering another miracle, pharma will be relegated to its perennial role as the epitome of corporate greed. When we're needed, we're Jonas Salks; when we ask to be paid, we're Martin Shkrelis.

I suppose that's human nature. Free lunch for everyone. Our critics believe they can lower prescription prices by malign­ing the industry. Why can't they acknowledge the tremendous benefit we bring every day to people around the world?

Would that be asking too much?

Sander Flaum is principal of Flaum Navigators.