Economics of medicine

Recently I was reading an article in Aeon Magazine about the challenges faced by the medicine industry – commonly referred to as Big Pharma or Big Pharma written in one of those fonts with blood dripping from it and a syringe being stabbed into a baby. One of the big changes in medicine development discussed was the patent period that allowed monopolies on new drugs, which in turn saw orphan drugs – not drugs for Oliver “please sir, can I have some more” Twist, but drugs for rarer conditions and illnesses – become more popular/profitable to develop.

It’s an interesting issue and the article is worth reading. But it got me to thinking about something a little tangential. No, not whether Oliver Twist needs a remake set in south-east Asian sweatshops. I wondered how much money is actually spent on things.

Take for example this:

screen-shot-2015-02-11-at-9-03-17-am
Source.

Drug development appears to take a backseat to marketing. But this depends on what section of the market, how big the company is, and other factors. Clearly, medicine development is still a big expense, but how much is spent on research and development overall?

Worldwide pharma R&D $
Total global pharmaceutical research and development spending from 2008 to 2022 (in billions of U.S. dollars) Source.

That global pharmaceutical research spending is quite large at $165 billion. Or is it?

Rank Country Spending
($ Bn.)
% of GDP % of World share
World total 1,739 2.2
1 United States United States 610.0 3.1 35.0
2 China People’s Republic of China 228.0 1.9 13.0
3 Saudi Arabia Saudi Arabia 69.4 10 4.0
4 Russia Russia 66.3 4.3 3.8
5 India India 63.9 2.5 3.7
6 France France 57.8 2.3 3.3
7 United Kingdom United Kingdom 47.2 1.8 2.7
8 Japan Japan 45.4 0.9 2.6
9 Germany Germany 44.3 1.2 2.5
10 South Korea South Korea 39.2 2.6 2.3
11 Brazil Brazil 29.3 1.4 1.7
12 Italy Italy 29.2 1.7 1.7
13 Australia Australia 27.5 2.0 1.6
14 Canada Canada 20.6 1.3 1.2
15 Turkey Turkey 18.2 2.2 1.0  sourceoriginal

Suddenly the amount spent on medicine research and development seems rather small. The USA government alone could easily cover the expense of medicine research if it decided to change priorities, since it spends 3.7 times that much on defence.*

Would it be a good idea for governments to have a Department of Pharmaceuticals that researched, developed, and sold medicines? Would that be money better spent than stockpiling tanks in a desert? Certainly, it would address several of the issues raised in the Aeon Magazine article around how the profitability of drugs, rather than the consumer needs, drives research and development.

This sort of thinking could be applied to many industries. The reality is that there isn’t actually a shortage of money but a lack of incentive to invest money in some areas in favour of others. The solution doesn’t have to be the government taking over, nor does it have to be about private companies not being profitable. But maybe it does have to be about rethinking what we spend money on.

Richard Denniss made similar arguments in his Quarterly Essay Dead Right about the Australian economy.

So maybe it is time to stop accepting the argument “we can’t afford X” and start having the discussion about how we spend for the most good. Or not, I’m not your boss.

*To be clear, I’m not suggesting we stop all spending on something like defense, or that there aren’t reasons for spending money on things like tanks. But as Richard’s video suggests, we are making value judgments and assumptions without really questioning them.

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We don’t know the world

A few years ago I saw a fantastic talk from Hans Rosling about the world and statistics. Okay, I probably lost a few people by implying statistics are fantastic, and now I’ll lose some more by saying statistics ARE fantastic. Unfortunately, Hans is no longer with us, but his son and daughter-in-law – Ola and Anna – are continuing his work with Gap Minder.

Recently they released the results of their 2017 survey of world knowledge. After looking at the results they decided to call it the Misconception Study.* You’ll see why.

That’s right, less than chance. People really don’t know that much about the world.

gms_2017inpage-1024x523

Do you think you could do better? Well, find out! Take the 2018 quiz here. Of course, this is the part where I say that I passed the test. Humble-brag. But in fairness, as I’ve already mentioned, I’ve been following Gap Minder and I like statistics.

Could you pass the test?

*They probably called it that prior, but I’m making a point here, dammit!

Can you name a book?

creative-bookshelf-18__700

Sounds like a simple challenge, right? Name a book, any book at all.

In the long tradition of asking Americans general knowledge questions on the street and filming their glorious ignorance, I present this video from Jimmy Kimmel.

Before we all laugh and point at the Americans and insult their intelligence, let’s remember that you could do this just about anywhere. Although, Americans do make this stuff easy at times. I’ve previously discussed the reading figures for the US, UK, and Australia. I’m sure those numbers are at least in the same ballpark as other countries, if not outright representative.

Wait, why guess when I can actually use the wonders of the greatest information resource in human history to look that up? Why have an unfounded opinion that I then rant about in indignant outrage, arrogantly assuming I’m right and belittling anyone who does bother to look up the data? To the research!

Let’s start with the data that the above video was citing from Pew Research.

ft_18-03-22_nonbookreaders_whohasnt
Source

As we can see, the 24% figure is showing that older, poorer, less educated, men (just), and Hispanics read less in the USA. This isn’t a new conclusion, as data from Pew in 2016 shows. The conclusion around the number who don’t read is also similar to the 2016 results of 26% not having read a book in the last 12 months. I’m not sure you can interpret much change over time in the number of people reading, but numbers might be slowly decreasing (although, look at the uptick in audiobooks as that format has come down in price).

ft_18-03-07_bookreading_printbooks
Source

Now we can look at how the USA sits in terms of reading. I’ve previously discussed how Aussies spend roughly 23 minutes per day reading (ABS figures), or an hour a day if you believe the Australian Arts Council report (I suggested there was possible survey bias in that figure). Below you can see that the NOP World Culture Score puts Australia at 6 hours 18 minutes – which I think makes this an “ALL-YOU bench-press” set of numbers.

chartoftheday_6125_which_countries_read_the_most_n
Source: Statista

This chart suggests that the USA is probably typical for English speaking countries, but that many other countries read far more on a weekly basis in terms of hours. Unless reading is code for something else in non-English speaking countries. Maybe they thought they were being asked about how many hours they spent having sex per week.

If we then look at the countries and how frequently they read books you can see in the chart below that they were afraid to include the bars for “didn’t read a book”. The high end has only 14% of Chinese people not reading a book, whilst the low end has the Dutch at 43% not reading (USA comes in at 29%, UK 28%, Australia 38% – I demand a recount!!).*

Screen Shot 2018-05-25 at 7.50.23 pm
Source: Statista

How about the number of books people read, or at least what they claim once they round up?

number_of_books_read_in_the_last_12_months2c_2011
Source: Eurostat
table-2
Source
Screen Shot 2017-10-08 at 6.24.23 PM
Source

What this all shows is that there are plenty of countries where you could ask ten people on the street to name a book and have one or two of them fail. You could ask those ten people what book were they reading today and only three of them could. Isn’t that sad? I reckon people would really enjoy reading if they made time for it. I’ve commented before on why I think people don’t read, suggesting that they don’t because they get told to read literature when they actually enjoy thrillers, sci-fi, and romance.

Maybe it is time to change that before someone sticks a camera and microphone in our faces.

*Be careful with my assumption here. Depending on how the question was asked and any other unreported categories, I may be very wrong in assuming the unreported numbers are non-readers.

A Book a Day: Six health benefits of reading

healthbenefitsreading_1600x800

Penguin Australia recently published an article suggesting reading was awesome for your health. Previously I have posted science-backed articles on the benefits of reading (1, 2), so more science telling us that readers are awesome never goes astray. Although, as much as I love some good old confirmation bias, I can’t just share that article without some commentary from the further reading. I mean, the article title is a play on An apple a day keeps the doctor away… that can’t pass without some mockery.

Reading can provide hours of entertainment and pleasure, impart knowledge, expand vocabulary and give insight into unknown experiences. Additionally, research has shown that it has a variety of physical, mental and emotional health benefits. If you need another excuse to pick up a book, here are six ways reading can benefit your health.

And if those six reasons don’t encourage you to pick up a book, then think of them as six ways you’ll be superior to other people.

Improve brain function

Neuroscientists at Emory University in America conducted a study and discovered that reading a novel can improve brain function on a variety of levels. The study showed that when we read and imagine the settings, sounds, smells and tastes described on the page, the areas within the brain that process these experiences in real life are activated, creating new neural pathways.So next time you’re indulging in an armchair adventure with a great book, you could technically claim you’re working out – your brain, that is.

This study was rather small, consisting of 21 university aged participants who had 19 days of baseline brain scans before 9 days of scans as they read Robert Harris’ Pompeii novel. Warning: they had no null group in this study, only the baseline comparison, so any conclusions drawn should be done next to a salt shaker. It does, however, draw similar conclusions to previous research I’ve discussed.

Obviously, stimulating the brain by engaging with a story is going to light up parts of the brain, but there is the implication that using our brains in this way will strengthen pathways. Calling it a workout for the brain is probably a stretch because it isn’t like our brain sits around doing nothing the rest of the day. But for me, the more interesting thing is the shared response among participants. It proves Steven King’s adage true about writing being a form of telepathy.

The big unanswered questions here are how does this compare to any other shared activity, and how does it compare to other similar activities. I’d bet crypto money – always best to keep bets symbolic – that any other activities would see similar responses.

Increase longevity and brain health in old age

Researchers at Yale University School of Public Health found that, ‘reading books tends to involve two cognitive processes that could create a survival advantage.’ According to their results ‘a 20% reduction in mortality was observed for those who read books, compared to those who did not read books.’And the longer you live, the more time you have to get through your to-be-read pile.

This study nags at my skeptic-sense. Nothing immediately jumps out and screams “This study is nonsense, don’t believe it!” but I can’t help but feel like it is. They sampled 3,635 people in the USA and compared readers to non-readers for longevity. Don’t worry, they factored in stuff like age, sex, race, education, comorbidities, self-rated health, wealth, marital status, and depression. But I’m still left with the nagging sound of my statistics lecturer telling the class that correlation doesn’t equal causation. See this example about storks and babies!

My suspicion is that there is something unmeasured that is confounded with reading that is the actual causal factor. This factor is probably also available from other activities, thus other activities will also increase your lifespan. Just my suspicion. Happy to be proven wrong.

Reduce tension levels

A 2009 study by the University of Sussex found that reading for just six minutes can reduce tension levels by up to 68 per cent.3 Researchers studied a group of volunteers – raising their tension levels and heart rate through a range of tests and exercises – before they were then tested with a variety of traditional methods of relaxation. Reading was the most effective method according to cognitive neuropsychologist Dr David Lewis. The volunteers only needed to read silently for six minutes to ease tension in the muscles and slow down their heart rate. If ongoing stress is an issue take a look at these simple stress management tips.

This claim is hard to pin down. It’s not like other studies haven’t shown reading (and yoga, humour, cognitive, behavioural, and mindfulness) have impacts upon stress levels. But unlike the linked studies, Lewis’ study hasn’t been published. The source in the Canadian National Reading Campaign links to The Reading Agency in the UK which cites an article in The Telegraph. Now, I suspect that this was probably one of those studies done for a report that no one has read because the only publicly available material on it is the press release. But it could also be rubbish research that didn’t get published because of claims like 300% and 700% better than other activities sound like made-up numbers.*

Increase emotional intelligence & empathy

Numerous studies have shown that reading books can promote social perception and emotional intelligence.2 Studies have also found that when a person is reading fiction, they showed greater ability to empathize. Similar to the visualization of muscle memory in sports, reading fiction helps the reader use their imagination to put themselves in someone else’s shoes.For books that’ll test your empathy, push your moral boundaries and ask ‘what would you do?’, take a look at this collection.

I don’t know why they referenced the same two studies again as they didn’t look directly at the issue of emotional intelligence and empathy. I’ve seen better studies, such as the one I mentioned in my piece on Literary Fiction In Crisis, and this one that literary people like to wave around because they can’t afford a Ferrari. So while this appears to be true enough, it is worth understanding why (read this one and see how lots of books have differing levels of literary merit).

Improve sleep

While some scientists believe reading before bed can inhibit sleep due to heightened brain activity, researchers at Mayo Clinic recommend reading as part of a relaxing bedtime ritual that can help promote sound sleep.4 This, coupled with the tension-relieving benefits of reading, can vastly improve both the quality and quantity of your sleep. You may want to stay away from page-turning crime and thriller novels though – you could be up all night…

Clearly these people don’t read thrillers. Am I right people? Huh?

Anyway, it is worth reading what the Mayo Clinic actually said:

Prevention
Good sleep habits can help prevent insomnia and promote sound sleep:
Create a relaxing bedtime ritual, such as taking a warm bath, reading or listening to soft music.

That’s right, it wasn’t that reading helped you sleep, it was that it could be part of a relaxing bedtime ritual. Could. They didn’t recommend it so much as used it as an example of a relaxing activity that wasn’t playing on the computer or watching TV (i.e. screen based). So this is overstating things a bit.

Improve overall wellbeing

Researchers at Italy’s University of Turin published an analysis of ten studies of bibliotherapy: the use of books as therapy in the treatment of mental or psychological disorders. Their findings showed that participants in six of the studies saw significant improvements in their overall wellbeing for up to three years after partaking in a course of reading therapy.5 With that in mind, here are some books to help you achieve mindfulness and find happiness in the everyday.

Worth reading the actual link on this one. In summarising they have made this sound like wellbeing benefits were being measured in most of the studies out to three years when only one of the ten studies did. This could just be me nitpicking, but it does overstate the results in my opinion.

As with many of my posts breaking down a sciency article, you can see that at best the claims are overstated, or as I’ve summed up previously I think you’ll find it is more complicated than that. And as much as I like reading – and I’m sure many of you reading this do as well – too often this sort of science isn’t actually helpful.

Sure, reading is awesome, but if you’re going to stick someone in an MRI to prove it, how about comparing it to other activities and including a nill treatment. That’s called good science! Readers don’t actually need some scientist to tell them their hobby is awesome (or maybe they do), and they especially don’t need overstated claims about that science in articles, it goes astray.

* Seriously, check out this “abstract” quote:

Abstract: Tested against other forms of relaxation, reading was proved 68% better at reducing stress levels than listening to music; 100% more effective than drinking a cup of tea, 300% better than going for a walk and 700% more than playing video games. Reading for as little as 6 minutes is sufficient to reduce stress levels by 60%, slowing heart beat, easing muscle tension and altering the state of mind. ‘Galaxy Commissioned Stress Research’, Mindlab International, Sussex University (2009)

1 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3868356/#s007title
https://www.sciencedirect.com/science/article/pii/S0277953616303689
3 Dr. David Lewis “Galaxy Stress Research,” Mindlab International, Sussex University (2009)
4 https://www.mayoclinic.org/diseases-conditions/insomnia/symptoms-causes/syc-20355167
5 https://academic.oup.com/eurpub/article/27/suppl_3/ckx186.244/4555858

 

 

Is sport king in Australia?

Sports Supporters: Alcohol Compulsory Accessory
Sports Supporters: Alcohol Compulsory Accessory

With pork-barrelling season in full swing, we will be seeing plenty of politicians hitching their wagons to prominent sports and sporting teams. The proclamations that sports are True-blue, dinky-di, Aussie will come to win over voters, with a little somethin’ somethin’ in the budget to sweeten the deal. Because sport is king in Australia, right?

Aussies are routinely described as sports mad, sports addicts, and that we love watching and playing sports in sporty sports ways. But how many of us actually play sports? How many of us actually watch sports? Given that you could describe weekly matches of football as repeats of the same teams doing the same thing for months on end annually, it is worth taking a look at a few of our assumptions about the claims.

Let’s start with a look at how many Aussies play “sports”. Inverted commas around sports? Yes, because when people say that 60% (11.1 million) of Aussies play sports – down 5% compared to 2 years previous – what they actually mean is that we’re classifying walking and generally not sitting on the couch watching TV as sport. Let’s make it fairer on sports and subtract the walkers from being classified as sport participants. And let’s not succumb to temptation and call golf just more walking with intermittent cursing. That means that our 11.7 million “sports” participants is suddenly 7.5 million, which is 41.4% of the population (and falling with the ageing population). That figure sounds impressive until you realise that figure is participation of at least once in the past year and doesn’t account for the regularity of participation. How regularly someone is involved in sports is a much better indicator of our interest and love of sports. As opposed to accounting for that time you went to the gym because of a New Year’s resolution or because the doctor ordered you too out of concern for being dragged into an orbit around you at your next visit. The reality is that less than half of the population engage in regular (3 times per week on average) physical activity, with roughly a third of those people being gym junkies (NB: young men are more likely to play a sport, that drops with age and isn’t replaced with other activities, whilst women are more likely to be involved in non-organised sports and remain doing so).

The Top 20 most popular physical activities are dominated by fitness activities like the already mentioned walking, aerobics/fitness, swimming, cycling, and running. One of the big name sports, AFL, ranks 16th on the list behind yoga. When yoga beats football for popularity it must only be a matter of time before the PM declares it the most exciting sport. For those wondering where rugby is on the list, the rest of Australia says ‘hi’.

Screen Shot 2016-05-28 at 12.56.43 PM

Of course, this is only looking at sports. How does sports participation compare to other activities? Well, ABS figures show that we spend roughly 23 minutes a day reading, versus 21 minutes on sports and outdoor activities (NB: this varies between genders and age groups). The US figures show similar results with more time reading than playing sports, but they also spend less of their day on both activities. So at least we are still better read and fitter than Americans in the low bar metrics.

Obviously sports aren’t all about participation and most would regard themselves as avid armchair sportspeople. It could be argued that the best way to stay injury free in sports is to participate from the comfort of the couch in front of the TV at home. The other option is to attend a sporting stadium dressed in clothes made from random assortments of gaudy colours to cheer on a team who are wearing similar clothes but are less inebriated. Or would the most appealing option be to go to a movie, concert or theme park? The correct answer is that people would prefer to attend a movie (59%), a concert (40%), or a theme park (34%). Live Comedy (31%) was more popular than Football (30%), Cricket (29%) and Rugby (25%).

Screen Shot 2016-05-28 at 12.42.50 PM

Of course, someone is bound to point to spectator numbers for AFL, A-League, and NRL that look very impressive. With average match attendances in the tens of thousands, and millions annually, sports are clearly important.

Competition Total spectatorship Average match attendance Year Ref
A-League 1,887,206 13,480 2013–14 [108]
Australian Football League 6,975,137 33,696 2014 [109]
Big Bash League 823,858 23,539 2014–15 [96]
National Basketball League 574,813 5,132 2013–14 [96]
National Rugby League 3,060,531 15,940 2013 [110]
Super Rugby 773,940 19,348 2012 [111]

At a glance the figures look mildly impressive, but much like enhancement pouch underwear, things aren’t nearly as impressive when you look at the attendance figures in the cold light of day.

Even if we disregard the doubling up and totalling of attendance occurring in the stats, it is easy to see that even the most popular sport in Australia would rank behind visiting Botanic gardens, zoos and aquariums, and libraries. They aren’t even in the same ballpark as cinema attendance. But we can go deeper on the reading, library and cinema figures, even getting frequency statistics so we can tell the difference between the people doing something “at least once” versus people doing something regularly in the past year. 47.7% of people are reading a book weekly, 70% of library attendees (mostly women) visited at least 5 times in the past year, 65% of Australians are (computer) gamers, and 65% of Aussies go to the cinema an average of 6-7 times a year. And yet sport has a segment in news broadcasts whilst reading, gaming, and parks and zoos battle to get media coverage. Technically if we wanted to be fair then the sport segment would be cut to make way for movie news and a live cross to the local library.

What about the economy? How much are households spending on sports? That’s a great question and a great segue into a discussion of how trickle-down economics doesn’t work in sports either. I mean, funding sports that way when it hasn’t worked in the economy must be a no-brainer, right? [Insert low IQ athlete joke here] Or we could stay on topic and discuss the $4.4 billion sports and physical recreation spend by households annually. Let’s not complicate things by talking about the buying of stuff like footwear, swimming pools, and camper vans. Seriously, camping is in the sport spending category? Either way, $4.4 billion sounds like a lot of money, until you realise that gaming is a $3 billion industry, and that households spend $4.1 billion on literature and $4.7 billion on TV and film.

We allow governments to spend a lot of money on big sports and big sporting events. Think that hosting the Olympics will encourage people to play sports? Nope. Actually, seriously, nope. One report described this idea as nothing more than a “deeply entrenched storyline”, sort of like a fairy tale handed down from one Minister for Sport to the next. Part of the problem is that we buy this narrative hook, line, and sinker, such that the sports themselves (and surrounding data agencies) never really bother to keep statistics to prove the claims. But they make for great announcements and ribbon cutting events on the election campaign trail, so the myth keeps on keeping on.

Ultimately the argument isn’t that sports are unpopular or bad but rather that we spend an inordinate amount of time pretending we like them far more than the reality. And that is impacting our elected officials more than a chance to wear a high-viz vest at a press conference. Maybe it is time to rethink what media and funding we throw at sports, and perhaps consider a gaming segment on the news.

So this pork-barrelling season look forward to the announcement of a new multi-million dollar yoga stadium in a marginal electorate near you.

Update: Charlie Pickering and The Weekly team cover some similar points for the Grand Prix events in Australia.

NB: I haven’t covered sports injuries, particularly how over half a million Aussies have long term health conditions as a result of sport. Please see this report for more.

Further reading:

Australian Sport Injury Hospitalisations 2011-12
http://www.tandfonline.com/doi/full/10.1080/19407963.2012.662619
http://apo.org.au/files/Resource/Crawford_Report.pdf
http://www98.griffith.edu.au/dspace/bitstream/handle/10072/57329/91705_1.pdf
https://theconversation.com/we-need-abs-arts-and-sports-data-to-understand-our-culture-30255
https://theconversation.com/olympics-success-leaves-a-mixed-legacy-for-australias-sporting-life-7531
https://theconversation.com/will-the-olympics-really-inspire-more-people-to-play-sport-8913

Down with Reading?

An interesting table of statistics – yes I am assuming statistics are interesting, why yes, I am a huge nerd – crossed my feed today. The table, presented below, shows the household expenditure breakdowns over time (1990-2009). The highlighted lines show the amounts spent on entertainment and reading.

US Bureau of Labor Statistics (with labour spelt incorrectly)
US Bureau of Labor Statistics (with labour spelt incorrectly)

For those of you who are blind or prefer reading my words rather than a table of numbers, the statistics show that since 1990 there has been a pretty steady increase in household expenditure on entertainment, but the amount spent on reading has been in steady decline. Clearly it is time to panic. Movies, TV and gaming have won. Time to give up reading and writing. No future in it.

Well, that would be the conclusion if you don’t go and look for the source data.

Now I am rather lazy, so I haven’t bothered to look up every year of data and tried to recreate the table. But what I have done is looked up the figures from a few of the years not included in the table: 2010, 20112012 and 2013. The spend on reading from those years is $100, $115, $109 (no 2013 data as yet) and entertainment spend of $2,504, $2,572, $2,605 and $2,482. Seems like that trend stopped, or something.

Actually, the trend has more to do with the household demographics and income than any change in book buying. Whilst in the early 2000’s there was a drop in reading for entertainment from ~0.4% of household expenditure to ~0.2%, this has been consistent since. So readers are still buying and reading books at roughly the same proportion as always.

And who are the readers? Well, from the demographics breakdown the readers tend to be middle-aged or older, higher income, educated households, or households without kids. Apparently having kids stops you reading, can’t think why. And clearly older and more affluent people are the ones who can afford the hardcover prices, or see the value in them, or just like having something on the bookshelf surrounding their money pile – rich people have money piles in their houses, right?

To me this doesn’t say reading is a dying industry, rather that there are groups being missed by the current industry. Of course I’m biased and probably daydreaming about a magical place where books hunt down DVDs for sport. The younger people tend to have less entertainment expenditure, with the average consumer spending 5% of their income on entertainment, whilst under 25s spend between 4 and 5%. Their book buying appears to have declined and is lower than the average consumer, at 0.14% (2012). This makes them a missed market (or possibly buying cheaper e-books). The other groups spending less on books are the less educated and lower income people, and again, not just in total expenditure but in the proportion of household expenditure.

Clearly these three groups could be reading just as much but instead of buying books they are borrowing them from friends or libraries, or they might be buying cheaper books. But something tells me this isn’t the case, what with the kids these days with their hippity hop music and haircuts. To my mind the fear that the market for books is shrinking, as suggested by the above table, is not borne out by the more recent data. We see more competition for entertainment dollars yet books don’t change that much ($150 to $110 over 22 years is 3 paperbacks in the US) suggesting that the problem is in who is reading. If reading is going to be only for richer, older and more educated people then we have a problem, especially if we aren’t creating the next generation of readers.