(credit: abby chicken CC BY)

A tale of bad luck and good fortune

Wat does a harrowing story reaching the news headlines tell us about our individual and collective response to people affected by fate?

Baby Pia is 9 months old. She lives in Antwerp, Belgium, and has spinal muscular atrophy, a genetic condition that causes the muscles to deteriorate. Particularly in infants, it can cause premature death. There is a promising new drug, not yet approved in her home country, and therefore not reimbursed, but it is available in the US. Unfortunately, it would cost £1.7 million (1.9 million euro, 2.1 million dollar), much more than Pia’s family can afford. Undeterred, the parents started an appeal to raise the money.

This story hit the Belgian national news on Tuesday 17 thSeptember. Then, several things happened over a short period of time. Belgian health minister Maggie De Block stated that there was nothing she could do, and called on Novartis, the producer of Zolgensma, the drug in question, to make a gesture and offer the drug free of charge. Social media started buzzing with criticism of the greedy pharmaceutical industry, supported by the comments of high-profile philosopher and newspaper columnist. Simon Mignolet, former goalkeeper of Liverpool FC but now of Club Brugge donated the shirt he wore during Tuesday evening’s Champions’ League match against Galatasaray. Novartis defended the price of the drug as ‘cost-effective’, and confirmed it is willing to talk with the government.

And most strikingly, at around 2am on Wednesday morning, the SMS campaign launched by the parents on Sunday, reached its goal of 1.9 million euro, with more than 970,000 messages sent.

Only the most hardened cynic could remain impassive at this demonstration of national solidarity with two young, desperate parents and their baby. Assuming most people sent just one text message, nearly 1 in every 10 Belgians supported them to the tune of 2 euros (the telecom operators waived their own charge, for good measure).

It was also a most illustrative example of the so-called identifiable victim effect. In a paper from 1997, Karen Jenni and George Loewenstein propose possible reasons why we are more likely spend resources on saving the lives of specific, identified persons than on saving unidentified, statistical people. In the case of baby Pia what likely played a part is the vividness of the image of a cute baby, and the certainty that, unless action is taken, she will die.

A little money, a lot of people (image via teampia.be)

Of course, we know that Pia is not the only baby in Belgium with the misfortune of having a condition that can kill her before she’s even a toddler. But she also was fortunate enough to have been propelled to the media headlines. And what stands out catches our attention — this is known as the salience bias. We may even be seeing some special pleading: the government or the producer of the drug ought to deviate from the prevailing practice (approving the treatment, and making it available for free) in this case.

Is the money raised well-spent? That is not an easy question to answer unequivocally. For the family, for sure. For the individual donors, the utility loss of 2 euros is negligible, and the warm glow many will feel, having contributed to such highly visible a good cause, will outweigh it many times over. But is (possibly — there is no certainty that Pia will respond well to the drug and be saved) one life the most that can be saved with £1.7 million? The Centre for Effective Altruism provides food for thought for anyone wishing to do the most good with their donation. One cause they highlight is the control of malaria: saving one life through mosquito nets treated with insecticide is estimated to cost $3,200. On that basis, more than 600 lives could be saved with the money raised for baby Pia.

The optimum allocation of scarce resources is, of course, an even more important matter for governments. No matter how it is cut, the amount of money a government can spend is limited. Every pound spent on drugs cannot be spent on education, policing, road maintenance and umpteen other things. In fact, every pound spent on Zolgensma cannot be spent on antiretroviral drugs to control HIV medication, on immunotherapy for cancer patients, or on social care for people with dementia.

One of the roles governments need to take on, on behalf of its citizens, is to help those who, especially if through no fault of their own, are suffering as a result of misfortune. They effectively act as an insurer, taking premiums from everyone (through taxes or social insurance contributions), and paying out claims to unfortunate citizens — like Pia and her parents. But just like real insurers restrict the insured risk and cap pay-outs, so the government must do. Public funds are limited too, and that inevitably means that some therapies will not be considered cost-effective, and therefore not be reimbursable.

How can such a small bottle cost so much? (image: Novartis)

The finger then quickly points towards the pharmaceutical companies, who take advantage of the sick (or of the governments acting on their behalf) to crank up prices. The examples come to mind of the EpiPen (used by people at risk of extreme allergic reactions), whose price increased sixfold over nine years, and of Daraprim (to combat toxoplasmosis) which saw an almost overnight price hike from $13.50 (£10.70, €12) to $750 per tablet. But these excesses are not representative. Developing drugs is a labour-intensive, long-winded, and highly uncertain process, and they enjoy short patent protection. There are fewer and fewer blockbuster drugs that can be used to subsidize those to treat rare conditions, so the cost of such medicines must go up.

When — like Karin Jirofllée, a member of the Belgian parliament for the Flemish social-democrats did on Thursday: “1.9 million for a single injection, a scandal!” — we criticize the high price of a drug, do we have a sensible point of reference? Do we know how much it cost to develop cost of the drug has been, and how large the market is? Do we know what existing therapy it would replace, and what this currently costs? A syringe containing a dose of Zolgensma looks much the same as one filled with insulin. But one is a remedy for a condition with a prevalence of 1–2 per 100,000, while the other controls a condition with a prevalence that is 10,000 times larger. Also, few people have an idea of what drugs really cost. They are heavily subsidized In many countries (like Belgium), and patients pay only a small fraction of the price.

So, the heuristics we use to assess the fairness of the price of a drug are of questionable validity. (This is not to say that the provision of pharmaceuticals is totally efficient and fair. But while we can say how much we are willing to pay for a medicine, we cannot dictate how much it will cost to develop and produce. If we, individually or collectively, are not prepared to pay what a drug costs, then we should not be surprised if it doesn’t get made.)

However, with approval processes and prices for drugs being what they are, what should we think of grassroots campaigns to help people who were dealt a bad hand? Are they a good illustration for the kind of approach small-government Libertarians favour: private charity replacing programmes funded by public money? Could something this exceptional become the norm, and work not just for extreme cases like Pia’s?

It is tempting to think that we all have enough compassion with our fellow citizens to dip into our personal pockets to help them out when they are afflicted by misfortune. Perhaps that is even true. But the reality is that, just like people can have bad luck, they can have the good fortune of catching the nation’s attention, while others do not. Can we really rely on hundreds of thousands of people sending text messages for every baby Pia out there — and for everyone else who is in need?

Originally published at http://koenfucius.wordpress.com on September 20, 2019.

Thanks for reading this article — I hope you enjoyed it. Please do share it far and wide — there are handy Twitter and Facebook buttons nearby, and you can click here to share it via LinkedIn, or simply copy and paste this link. See all my other articles featuring observations of human behaviour (I publish one every week) here. Thank you!

Accidental behavioural economist in search of wisdom. Uses insights from (behavioural) economics in organization development. On Twitter as @koenfucius

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