On Wall Street: A time bomb ticks under Big Pharma

NATIONAL VACCINE INFORMATION CENTER, Vienna, Virginia http://www.nvic.org
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(subscription only) THE FINANCIAL TIMES

By Stephen Schurr

March 25 2005

"It isn't a stretch to say Big Pharma's fortunes are tethered in part to the Amazon.com sales rank of Evidence of Harm"

It is hard to find a sector that suffered more in 2004 than Big Pharma.

Runaway healthcare costs became an issue in the US election. Seniors surpassed wayward teens as America's biggest drug lawbreakers, crossing over to Canada to get cheaper supplies. In September, Merck withdrew its arthritis drug Vioxx, which spawned lawsuits. Lurking beneath the headlines was Wall Street's worry that Big Pharma's pipeline of new drugs looked dry. The S&P 500 Pharmaceutical index fell 9.5 per cent for the year.

Early this year, some value investors have swooped, believing pharmaceutical stocks were poised to recover. While they may be right, it's possible that some issues may make 2004 look like the calm before the storm.

One controversy looks likely to fester. Big Pharma would love to put it to rest, but the April publication of a well-researched book is likely to push it to the fore.

The debate centers on whether the use of the toxin mercury as a preservative in vaccines for infants has played a role in the surge in autism cases. No answer proving or disproving a link has emerged, but in Evidence of Harm: Mercury in Vaccines and the Autism Epidemic, author David Kirby sympathizes with the drug industry's opponents: the parents of children with autism who cannot otherwise account for it.

Wall Street, the broader American public and the global community is largely unaware of the controversy. It isn't a stretch to say Big Pharma's fortunes are tethered in part to the Amazon.com sales rank of Evidence of Harm. Over the past two decades, cases of autism have risen sharply in the US. In 1987, roughly one in 10,000 American children were diagnosed with autism or a related disorder. Today the rate is 1 in 166. The epidemic has coincided with a surge in new vaccinations for infants between 1988 and 1991. Many of these vaccines contained a preservative called thimerosal, which is 49.6 per cent mercury based on weight.

The book plays like a detective story. It begins with a crime of sorts. The protagonists took their children for thimerosal-based vaccination shots, then watched in horror as their kids became violently ill soon before tumbling into the "hell" of autism. The parents search for clues and their path keeps leading them to mercury.

In 1982, the US Food and Drug Administration banned thimerosal and other mercury-based preservatives for use in products such as skin creams and nasal sprays, but never did anything about thimerosal that gets injected into newborn babies. The ex-Soviet Union banned thimerosal-based vaccines two decades ago.

In the 1940s, a condition known as Pink Disease afflicted thousands of children with symptoms similar to autism. It arose in those with sensitivity to mercury being used as an antiseptic in teething powders. Once mercury was removed from the powders, Pink Disease disappeared.

The parents are troubled by the US health agencies who, in their opinion, seemed more interested in protecting the US vaccination program and downplaying the evidence of a likely link than acknowledging the crisis. The parents are aghast when an unknown person slipped an eleventh-hour rider in the anti-terrorism Homeland Security Act aimed at inoculating Eli Lilly, which invented thimerosal in the 1920s, and vaccine makers such as Merck and GlaxoSmithKline, from hundreds of mercury-related lawsuits. While US health officials in 1999 called for a voluntary removal of vaccines containing thimerosal, they remain in use in the US and around the globe. Attorneys have found loopholes that have allowed them to press ahead with lawsuits alleging fraud and malfeasance by the industry for using toxic mercury in infant vaccines.

If any one of these suits is successful, the possible damages beggar comprehension. As many as 1.5m Americans have been diagnosed with some form of autism, and a conservative estimate puts the cost for lifetime treatment, education and care at $2m per person. Whether the industry or the government ends up footing the bill if a link is found, the potential liability makes asbestos litigation look like belonging to a small claims court.