Good morning Hank it’s Tuesday so 1.6 million people will
die of tuberculosis this year-- more than will die of Malaria and HIV combined
which is especially infuriating because tuberculosis is curable.
And there’s a company you’ve probably never heard of called Danaher that
over the next ten years has the opportunity to save hundreds of thousands of lives
and I’d like all of us to encourage them to take that opportunity.
So tuberculosis has killed over a billion people in the last 200 years,
and we’ve made very little progress in ending it,
because both testing and treatment remain out of reach for millions.
Like this year of the 10 million people who will get sick with TB,
about 4 million people will go undiagnosed, often dying before they can get an accurate test.
And among those who do get diagnosed, most are diagnosed via
a person looking through a microscope at a sputum sample,
which is precisely how we diagnosed tuberculosis 130 years ago.
There are two downsides to the microscope method. First, it misses more than 50% of cases,
especially in young children and immunocompromised people.
And second, even if it finds TB,
microscopy can’t tell you whether a case is resistant to antibiotics,
which means that many people end up on the wrong treatment regimen
and commonly die before they can get on the right one.
Now I know what you’re thinking:
Gosh, I wish we had a miraculously fast, and accurate test that could tell people
not only whether they have TB but which drugs their TB will respond
to so we could immediately begin curative treatment.
Well, good news: We do. It’s called the GeneXpert Machine
and it’s incredible. It’s made by a company called Cepheid,
which is owned by this larger company, Danaher that also owns lots of other companies.
And this GeneXpert Machine can test not just for TB
but also for HIV, covid, and many, many other diseases.
Everywhere I’ve traveled in high TB burden countries,
people sing the praises of this incredible GeneXpert machine.
I mean, within an hour,
you can tell whether they have TB and also what course of treatment will cure their TB?
Incredible. Amazing. Wondrous.
Thank you, Cepheid, for building this machine. Thank you, Danaher, for making it all happen.
There’s just one problem. As a lab tech in Sierra Leone
very succinctly explained to me:
The machine is amazing. If only we could afford the tests.
Which brings us to the printer ink business model. Now you may know that inkjet printers
are often sold at a low profit margin, because that’s not actually how
the printer companies make money.
They make their money selling ink once you’re locked in to a printer,
they make money selling ink, often ink that you can’t buy from anywhere else.
The same business model is used in disposable razor blades
and also Nespresso like, take over the coffee market
with inexpensive machines, and then price gouge on the Nespresso pods.
And that is what Danaher does with TB tests.
And that’s not, like, my conclusion. Their CEO Reiner Blair literally said,
“These are razorblade business models in mission-critical applications.”
Which sounds to me like they’re like, they’re bragging to their shareholders
about ripping off the world’s poorest people.
Ok, so Danaher currently charges $10.00 dollars for each of these test cartridges,
which can detect TB and also test for resistance
to a common first line antibiotic.
And they also make another cartridge that test for resistance to four more TB drugs.
For that one, they charge not $10.00 dollars, but $15.00 dollars, which is frustrating because
1. We really need to identify extensively
drug resistant TB quickly and accurately to prevent its further spread, and also
2. It doesn’t cost Danaher more to make those cartridges than the regular ones.
All the cartridges cost them about the same to make.
So how much should these cartridges cost?
Well, Danaher refuses to share any cost information
with global health authorities, but in 2019 Doctors Without Borders
commissioned a study asking a group to look at how much it costs to make these.
And what they found is that it costs somewhere between $3.00 dollars and $4.50 dollars.
The same is true for all of Danaher’s test cartridges,
regardless of whether they’re testing TB, xdrTB or HIV or anything else.
Based on that study, Danaher is charging at least a 220% profit margin
for their $10.00 regular TB cartridges, and closer to a 500% profit margin for their
extensively drug resistant cartridges, which from my perspective, is just unconscionable.
I apologize if I sound angry but I’ve known so many people
who went undiagnosed for months or even for years, and some of those people have died.
And so I am angry, they died because they couldn't get an accurate test in time
and I simply don’t believe that Danaher charging these profit margins
is making it easier for anyone who needs the test to be able to access it.
Instead they are overcharging poor countries
for tests and preventing competition by locking people into their machines
with their printer ink business model they love to boast about.
Also, in developing these tests, Danaher and Cepheid received over
$250 million dollars of public funding–most
of which came from taxpayers.
Like me. And you.
And I think it’s past time for Danaher’s prices to acknowledge that GeneXpert tests
are public goods, largely funded by the public, and it isn’t appropriate to use them to enrich
the world’s richest people at the expense of the world’s poorest ones.
Since 2019, Partners in Health, Doctors without Borders,
and a huge array of other organizations have been trying to convince Danaher
to consider lowering the price of these cartridges to $5.00 dollars per test cartridge
which would be a healthy profit margin instead of an obscene one.
They’ve written open and closed letters. Cepheid nor Danaher haven’t responded.
They’ve lobbied for $5.00 dollar tests at public meetings.
Cepheid and Danaher haven’t not responded.
And so they've asked us to join them in taking the next step on that journey.
Now look, Danaher is a company with 8 billion dollars in profit.
They are not hurting. But it’s a little hard to put pressure on them
because they don’t own a lot of consumer-facing stuff.
Although they do weirdly own,
of all things Pantone the color-matching company?
They’re currently in the process of spinning it off,
into another company but Danaher shareholders
will still be Pantone shareholders, so maybe there’s some pressure to apply there.
But mostly I think it’s important
for Danaher to know that this is just a bad business decision.
It’s important for them to know that we are paying attention.
And we will continue to pay attention. And we will endeavor to make it cost more
to their reputation and their ability to recruit and do business than the infinitesimal
hit to their profit that would accompany $5.00 dollar tests.
So that’s where you come in. If you have five minutes to make a phone call
or write an email, there are links below and in the pinned comment.
Also, please let Danaher know on social media that you will not accept this injustice.
They’re on Twitter and Facebook,
and Instagram and Threads
and Hank and I will be in all of those places, too, amplifying your messages.
And if you happen to work at Cepheid, which makes the cartridges,
or Danaher, which makes the decisions, let your bosses know that you’re not ok with this.
I know that takes a lot of guts, but it was an essential part
of the pressure on Johnson and Johnson that led to them swiftly announcing they would
allow generic competition for their drug Bedaquiline.
Lowering the prices of these tests to $5.00 dollars
would likely save hundreds of thousands of lives over the ten years.
And I am disappointed that Danaher is currently choosing profits over people
but I don’t think that it’s inevitable.
I think that most people most of the time
want to do what is right, they just sometimes need
polite but impassioned reminders of what is right.
I know that I’ve benefited from those polite but impassioned reminders from others, even when
they’ve made me uncomfortable..
And I think Cepheid, Danaher,
and their executives will similarly benefit from your polite but impassioned reminders.
Finally, a message to Danaher execs:
You’ve built something amazing with the GeneXpert Machine,
but building something is only valuable if the people who need it most can access it.
Right now you’re falling short on that front
because the people who most desperately need your tests
often can’t get them and that results too often in them dying.
It’s time for $5.00 dollar tests, and it’s time to put people over profits.
Hank, I’ll see you in comments,
on social media, in Danaher’s inboxes and their phone lines.
And then I’ll see you on Friday.