It’s unusual when a foreign government weighs in on another country’s domestic issues. It tends to incite a very negative reaction in the domestic country. But such was the case this weekend. Officials from India came to Chicago to make their case to a small gathering of healthcare executives. Gathering in the Chicago hotel to hear the Indian Government’s pitch were the heads of several major U.S. pharmaceutical companies, medical device firms and at least five significant biotech companies. Each executive brought a small contingent of confidants and legal counsel – packing into the small meeting room and clustering around round tables with colors to identify themselves – no name badges, no company names, even the meeting room was identified only with the generic listing “Training Session.” It was all very secretive – and quaint.
And what a pitch it was. The Indian Government did an amazing job starting off the presentation by highlighting their growing role in the pharmaceutical industry. The leading provider of the world’s API. They are a growing powerhouse in the generics industry (although, as readers of Pharm-Aid know, I have been very critical of the Indian generics industry for poor quality control standards and corruption among Indian company officials). Yet, the executives in the room knew all of this. I don’t think there was anyone in the room who hadn’t been to India at least once to see this first hand. This was only to be the amuse bouche for the main event.
The main event was a panel of noted academics, industry experts and think tank gurus to discuss the impact of ObamaCare on the U.S. market. From the $80 billion cut in pharma reimbursement to the $40 billion medical device excise tax, the U.S. market wasn’t what it once was. The panel discussed in mind-numbing detail the numbers of what ObamaCare finance reform would to do the healthcare industry. While nearly every company engages in some degree of outsourcing (from API to contract manufacturing, etc.), nobody has gone all the way – yet.
And then came dessert. An Indian official took the podium and began outlining what India was willing to do for companies that wanted to bring jobs. Do you want to open an R&D center? India has significant incentives. Who is going to run these facilities? You can – through extremely generous expatriate packages. He called Obama’s health reform initiative the single greatest opportunity in global outsourcing the world has ever seen – and he is right. India’s opportunity is America’s lost jobs.
This is a period of incredible change in the United States. The pharmaceutical and healthcare industries have been a growth engine for the U.S. over the last 40 years. Over 700,000 people are directly employed in pharmaceutical related jobs and another 2.5 million people rely on the pharmaceutical industry for their livelihood. No country in the world can compete with the level of innovation that has occurred here. The U.S. has been the gem of the world’s envy. Are those days gone forever?
The general tone from this weekend’s meeting of healthcare executives is that we’re on the cusp of taking the last great American industry and destroying it. Current proposals from President Barack Obama and Congress would turn the healthcare industry into something like the automotive industry – unprofitable, ignorant, stagnant, dependant on government subsidies and of such inferior quality as to be laughable. We’re going to take BMS, Amgen and Genentech and turn them into Ford, Chrysler and General Motors (Note: for the record, I’m not saying BMS, Amgen or Genentech were at the meeting, I’m only using them as an example of companies that have been strongly innovative). It’s a sad, sad day for American innovation.
You have to give credit to the Indian government for identifying a real opportunity here. Without a doubt, healthcare reform will fuel outsourcing and the exportation of American jobs.
