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2005 National Health Research Forum — Transcript

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10:40:37:00 Mary Woolley: I’m Mary Woolley andit’s my great pleasure on behalf of the Research!America Board of Directors towelcome you to our 2005 National Forum “Research: The Risks, the Rewardsand the Returns.” Now we recognize that these are both very exciting butalso very challenging times for our nation’s research enterprise.

10:41:03:25 As an advocacyorganization committed to taking action to make research a higher nationalpriority, we are proud to bring you a discussion among action-oriented leadersand as our keynote and panelists on today’s program. I hope when you leave heretoday, you will be stimulated to take action for research.

10:41:31:13 Before we begin, Iwant to thank our general sponsors of our 2005 National Forum. Beginning withour host sponsor, Dr. Alan Leshner. Alan, I know you’re here. There he is. Standup, please. Thanks to Alan and his colleagues, we have enjoyed a really strong,and I think beneficial for science, partnership with the AAAS for several yearsnow. Thank you, Alan.

10:42:03:02 We want to thank our other sponsors oftoday’s forum. We thank Abbott Laboratories, represented this morning by Dr.John Leonard-and he’s here-Cindy Schwab and Adele Witenstein. We thank theAARP, represented by William Novelli. We thank Amgen and the Association ofAcademic Health Centers.

10:42:26:07 I think Dr. Roger Bulgeris here; Burrill & Company; Ethicon EndoSurgery; Infocast; Omeris,O-m-e-r-i-s, Ohio’s Biosience Development Organization, represented today byMatthew Schutte; PARADE magazine; andPfizer, represented by Dr. Joe Feczko, Susan Berger, Dolly Judge and TalbottSmith.

10:42:56:07 The Ohio state UniversityMedical Center and the Ohio state University Office of Research, representedtoday by Dr. Thomas Rosol and Carolyn Whitaker. The University of CincinnatiMedical Center; the United Health Foundation and the Universities ResearchAssociation, Inc., represented by Dr. Ezra Heitowit.

10:43:18:11 Thank you all for making this Forumpossible and for making our work at Research!America possible. Well, it is nowmy honor and pleasure to introduce our keynote speaker this morning, the Lt.Gov. of Ohio, Bruce Johnson. Appointed Lt. Gov. by Gov. Bob Taft in January ofthis year, Bruce Johnson is leading the effort to promote Ohio as the premierebusiness location in the nation.

10:43:47:23 He does this not only fromhis role as Lieutenant Governor but also as director of the Ohio Department ofDevelopment, a position he has held since September of 2001. In addition tothis, Lt. Gov. Johnson serves his chair of Ohio’s Third Frontier project, thestate’s $1.1 billion dollar commitment to expanding Ohio’s research andtechnology capabilities and promoting innovation and company formation thatwill create high paying jobs for generations to come.

10:44:21:22 To encourage investment inOhio’s knowledge-based economy, Lt. Gov. Johnson has led the efforts to helpensure that research and technology organizations have access to venturecapital that is critical to their success. A recent study by one of thenation’s leading economic think tank shows that between 2001 and 2003, Ohio ledthe nation in the relative growth of total venture capital invested inbiotechnology. Congratulations on that accomplishment!

10:44:54:21 Prior to becomingdevelopment director, The Honorable Bruce Johnson served as a member of theOhio Senate from April 1994 to September 2001. He was the youngest in age aswell as in history of the Ohio Senate to be appointed chairman of the SenateJudiciary Committee. Later he was appointed chair of the powerful Ways andMeans Committee.

10:45:17:27 He was also electedpresident pro tem, the second ranking member of the Senate. The LieutenantGovernor’s private sector experience includes an extensive legal background.Until his appointment as development director, he was a member of counsel tothe Chester, Willcox and Saxbe law firm in Columbus where he provided small-and medium-size businesses with guidance regarding corporate structureemployment policy and risks management.

10:45:45:09 Please join me inwelcoming Ohio Lt. Gov. Bruce Johnson.

10:45:59:21 Bruce Johnson: Thank you, Mary. We’ve hadquite a morning. We took off from Columbus in one of the governor’s fineaircraft. I think we purchased it in 1978 and we turned around and came backbecause there was a problem with one of the devices. And so we came over in asmall, five-seater. I’ve had a very enjoyable morning, but my feet are stillfrozen. It was quite a flight.

10:46:26:27 We are, however,persistent in Ohioand so we wanted to make sure that we made this trip. I’m pleased in what we’redoing and we believe what we’re doing is providing a boost to Ohio’s high-techeconomy. I’m very pleased that what we’re doing has captured your attention andso I’m honored to have the opportunity to share some of our strategy with youand some of our ideas.

10:46:51:23 I’m also humbled to bementioned alongside with many of our distinguished panelists this morning. Sothank you all for participating with us. I’d like to recognize The HonorablePaul Rogers, a longtime friend of the health care community and Research!America.

10:47:07:25 As a former member of the Board atCleveland Clinic, he knows something about Ohio’s reputation in the medical field. Alsocongratulations to The Honorable John Porter for his selection as the nextchair of Research!America.I must also recognize some Ohio sponsors at today’s event: the University ofCincinnati’s Medical Center, Ohio state’s Medical Center and their researchoffice, Ethicon Endo-Surgery, and Omeris.

10:47:37:24 My remarks should hit hometo these folks because they are all partners in our efforts to grow technologyjob creation in the state of Ohioand to focus on research and development for the purpose of commercializing newproducts. In fact, Ethicon Endo-Surgery was a recipient of our 2004 ThomasEdison Award, the state’s highest technology honor.

10:47:58:26 It is awarded annually toone organization that demonstrates global leadership in fostering orimplementing innovation. The theme for this year’s forum is “Research: TheRisks, the Rewards and the Returns.” Weknow a little bit about this.

10:48:18:20 We have been focused on itsince the day I arrived at the Ohio Department of Development. We asked for astudy that was conducted by the Battelle Memorial Institute. It laterculminated in a campaign to raise $500 million statewide the voters were goingto have to approve, and we did not succeed.

10:48:39:09 And so there are risks and there arerewards. We still have a $1.2 billion initiative and we’re going back to thevoters this fall for an additional $500 million. You see, our willingness totalk about the changing landscape of economic development in our country, andin our state particularly, was not beaten back by our loss at the polls.

10:49:06:04 We lost by fewer votesthan George Bush won in Ohio and you all knowsomething or have been paying attention at all, that we have both economicchallenges in Ohioand that election was enormously close, and therefore so was our election onthe ballot for the Third Frontier project.

10:49:24:22 So we’re going backbecause we believe that the state has an obligation for odd leadership andinvestment in the area of leadership and development for the purpose ofeconomic prosperity. In addition, let me just say that since Sir Isaac Newton firstgot knocked in the head with an apple, science has been fraught with risk.

10:49:47:04 Risk is simply unavoidable when you’redealing with the unknown. It is in many regards the very essence of science. Itis the risk that often causes heartburn when the research community and thepublic sector come together. There is just something disconcerting about havingthe words “risk” and “taxpayer dollar” in the same sentence.

10:50:07:05 I think at the state andlocal level, it is even more challenging because the Washington environment, Ithink the electorate assumes that there’s a certain amount of risk-taking andinvestment that they’re not intimately familiar with that goes on inWashington.

10:50:23:03 But at the local level,they always want to know what is the rate of return next week, next quarter,next year, not 10 years down the road when you’re able to develop new products.While logically the mind can rationalize that risk is necessary to reaprewards, it is an emotionally and politically difficult leap to accept; thatwhen it comes to publicly funded efforts, there will be some failure.

10:50:49:12 In fact, you can imaginethe looks I get when I tell someone that we in government are too afraid offailure and that we must be more risky in order to succeed. They always want anautomatic return on investment. They want to know exactly what they’re gettingin terms of the new project.

10:51:08:21 Our state projects tend to look more likeroads and bridges than science projects. The guy responsible for trying tojumpstart Ohio’s economy just said that the key to long-term success is in ourwillingness to accept some short-term failures.

10:51:28:02 We just can’t afford to beafraid of not having an automatic return on investment. In Ohio, and in fact inAmerica, we no longer have the luxury of being cautious. The world’s economy ischanging and if we do not adapt, we’ll find ourselves in crisis.

10:51:43:19 A recent report by theCouncil on Competitiveness, which discusses the changing nature of innovation,sums it up beautifully. They say innovate or abdicate. I won’t go into thereport’s details as the Council’s president, Deborah Wince-Smith, is with ourtoday.

10:52:00:13 However, its observationsare not that dissimilar to what we are experiencing on a daily basis in Ohio.Innovation itself is changing. There are more innovators, more places in theworld where innovation is occurring and has access more quickly to markets.

10:52:18:24 Innovation is becoming morecross-disciplinary. In the face of this, we have a choice. It’s to innovate orto abdicate. For those of you who are not familiar with Ohio, the Buckeye statehas a very long history of innovation. We’re world-class innovators ourselves.

10:52:36:18 Folks like Thomas Edison,Charles Kettering, the Wright Brothers, all called Ohio home. Ohio is thebirthplace of the airplane, the cash register, vocal (inaud.) rubber industry,on and on; our innovation contributions to society may well be unparalleled.

10:52:54:05 But unfortunately, as theysay, that was then and this is now. In Ohio, we are faced with the task ofreclaiming that culture of innovation in the midst of a changing and verychallenging economy. And that’s where the Third Frontier project that wasintroduced to you comes in.

10:53:11:03 For the first hundredyears of our statehood, Ohio’seconomy was rooted in agriculture. Our fertile lands and access to waterwaysensured that agriculture was king. And it was good to be king. Our populationgrew, our wealth grew, our infrastructure grew, and we were the gateway to theWest long before St. Louis laid claim to that moniker.

10:53:34:18 Agriculture was Ohio’s first frontier. Thencame the turn of the 20th century and the industrialized economy. The age ofmachinery was upon us. The infrastructure that had served the agriculture eranow served the explosion of industry.

10:53:51:07 We had access to rawmaterials. We had innovators to create quality products and processes, theskilled work force to do the work and the infrastructure to move productsthrough North America. Manufacturing was king and it was good to be king.

10:54:05:12 We grew to be the nation’sthird largest manufacturing state and our gross state product grew to more than$380 million at that time; it’s now $450 billion, making us the seventh largesteconomy in the nation. Manufacturing was and is king, but it was our secondfrontier.

10:54:27:22 There’s just one littlehitch in all this good news about manufacturing strength. For all its strengthin manufacturing, Ohio continues to lose manufacturing jobs, even though weproduce more goods today than we ever have in our history.

10:54:42:21 Manufacturing is still the king. Itcomprises more than 21% of the gross state product in our state. We have 17,600manufacturing firms employing 850,000 people. We lead the nation in value-addedproduction of primary metals, plastics and rubber.

10:55:02:28 We are the number twosupply in fabricated metals and automobiles. We remain the nation’s thirdlargest manufacturing economy. The question is why isn’t our population, ourgrowth in employment in manufacturing, increasing with all this explosivegrowth in production, like I said before.

10:55:21:10 We have more productiontoday than we ever had. More when the rust spell was really the rust spell.More when the manufacturing enterprises were really on top of the entire age.The answer is productivity, and it’s not a bad thing. The only way that yourstandard of living is going to increase really is through increased productivity.

10:55:43:24 It’s not a new phenomenon. Every endeavorman has ever undertaken, he has usually gotten better at. Since 1950,manufacturing production in the United States has increased six-fold and yetemployment has remained relatively unchanged. Phenomenon isn’t even particularto manufacturing.

10:56:03:13 Productivity affectedagriculture. The agricultural industry between 1967 and 1983, the number offarms when from 135,000 in Ohio to 78,000, while our production increased fromabout 78 bushels per acre to 138 bushels per acre. What technology and sciencedid for agriculture 100 years ago, is being repeated today.

10:56:29:03 Manufacturing withcomputers and automation. Employment and primary metals fell by nearly halfduring that same time period, going from about 155,000 to 76,000, and, in Ohio, this increase inproductivity has meant a decrease in the percentage of overall employmentattributed to manufacturing.

10:56:49:20 It’s gone from 20% in 1993to about 15% in 2003. You know, this is not unique to Ohio. It is causing quitea bit of economic trouble. There are folks who believed for generation aftergeneration that all they had to do was walk down to the corner, get a job atthe plant and they would be secure for a very long time.

10:57:16:22 That is history. That is not today’sreality. It is happening all over the world, though. However, in the UnitedStates, which reported employment at about 17% in manufacturing in 1990 hasdropped below 14% now. It’s also true in the United Kingdom, where the shiftwas 23% in 1990, 16% now.

10:57:38:07 It’s happening in China. Now howmany people would have guessed that? Am I suggesting something that is new?Well, supposedly all these manufacturers are going to either Mexico first andthen China or India, the actual percentage of employment dropping from 28% inmanufacturing in 1990 to 10%.

10:58:04:14 Why? Because themanufacturing enterprises in China have gone from government-based toprivate-sector based. They have applied lean manufacturing techniques andthey’ve become very, very productive. The bottom line is that corporate successin the second frontier has been dependent upon making quality goods in a moreefficient and less costly manner.

10:58:22:14 As the technology to do this increases, thelargest cost becomes labor, which must be reduced or found more cheaply inorder to maintain the bottom line and generate a profit. We call this generallyover time, commoditization and so where does that leave our economy?

10:58:42:11 Innovate or abdicate. Ifyou want to have a job that pays $2 an hour, compete with somebody who isefficiently producing something and getting paid $2 an hour. The question ishow can we invest and make sure that we maintain our competitive edge? And theanswer has to be, in a system that is constantly innovating and creating newproducts, not just in manufacturing in hard goods, but also in health care andin other aspects of the economy.

10:59:19:12 The Third Frontier isbased on the premise that the ongoing success of our economy is dependent uponour ability to continually develop high value-added products, those that arenot easily commoditized. Enter the Third Frontier project.

10:59:34:22 The Third Frontier project is a 10 year,$1.1 billion, we think soon to become $1.7 billion effort to promote research,development and commercialization of new technology made up of a number ofprograms that promote collaboration among the public, the private and highereducation sectors of our economy and help companies make the jump from a greatidea to a marketable product.

10:59:59:17 The project isthissstate’s largest ever commitment to expanding the high- tech researchcapabilities of our state in promoting innovation and new company formation andwe believe that it was create high paying jobs for generations to come.

11:00:15:06 Our strategy is to buildworld-class research capacity, accelerate the formation of the attraction oftechnology-based businesses and to promote and support new product innovation andthen to aggressively market Ohio’scompetitiveness.

11:00:32:11 The same scientist thatbumped his head proved that there are risks associated with science. He said,”If I had seen further, it is by standing on the shoulders of giants.”Likewise, the Third Frontier project realizes that our success will only beachieved by standing on our past success.

11:00:53:25 We do this by identifying where ourindustry strengths intersect with our research strengths. This tells us fromour perspective, from a strategic perspective where to build for futurestrengths. In fact, one of the first things we did, like I mentioned before,was to get a study conducted by the Ohio-based Battelle Memorial Institute, amember of Research!America,to determine Ohio’sexisting core competencies.

11:01:21:02 With limited resources, wefelt that it was absolutely critical to our success to know how to best todirect those resources and to leverage them with interested private sectorpartners. But we have discovered were fivers areas of excellence: power andpropulsion, advanced materials, information technology, instruments, controlsand electronic and the biosciences, around which we have built the Thirdfrontier project.

11:01:49:23 These five corecompetencies are the root of each of the 10 of so components of the ThirdFrontier project. Each component then addresses a slightly different need asyou move from research to commercialization. The right centers of innovationare a large scale, world-class research and technology development platformsdesigned to accelerate the pace of commercialization.

11:02:12:17 The Ohio Fuel Cell Initiative is supportingprojects to prove technical feasibility and reduce the costs of fuel cells. TheThird Frontier network is the nation’s most advanced fiber optic networkdedicated to education, research and economic development.

11:02:30:13 The Validation and SeedFund Program has been particularly successful. Since 2000, the state of Ohiohas awarded $18 million in the Seed Fund and Validation Fund, leveraging morethan $150 million in private sector start-ups. Sixty Ohio start-up companiesare helping to create already 400 jobs and you would expect that number to riseten-fold as those companies begin to grow.

11:02:58:29 Unfortunately, I do nothave time, nor would you have the patience, to list all of our programs indetail or to recount each one of their successes. You can visit thethirdfrontier.com if you like for a full overview. I do think that there are acouple of examples that you should be aware of that will help you in choosingthe path for innovation over the abdication of such.

11:03:24:25 If the core competencies are thecornerstone of the Third Frontier project, our right centers are itsfoundation. Their focus is on our area of competency. So far, the centers haveestablished in the areas of power and propulsion, advanced data management,fuel cells, computational medicine, stem cell and regenerative medicine andmolecular imaging.

11:03:47:01 One such center is theBiomedical Structural, Functional and Molecular Imaging Enterprise at the OhioState University with collaboration from Philips Medical Systems and RexsonEnterprises developing an ultrahigh field MRI scanner, the most powerful in theworld.

11:04:07:14 The development of thisenterprise is a great example how the multiplying affect of the Third Frontierproject is changing the landscape. The real success of the Third Frontierproject is not that we have spent $235 million on growing technology in thelast couple of years. The real success is found in the partnerships that havebeen formed, the additional dollars that have been leveraged and the newtechnologies that are being commercialized.

11:04:33:15 Ohio State’s molecular imaging enterprise,just over one year old now, displays all three. They’ve partnered with PhilipsMedical Systems, one of the best imaging companies in the world. They have beenable to leverage millions of dollars, including $6 million from the NationalInstitutes of Health. Thank you.

11:04:53:27 And Philips has addedemployees expanding its Cleveland facility where it has thousands of employeeswho are manufacturing MRIs today. In fact, we are manufacturing the nextgeneration, 7-Tesla MRI system, and it is being developed in partnership withthis center.

11:05:12:01 The other benefits ofthese types of arrangements is that they help us in the creation of economicdevelopment clusters, an area that develops a reputation for excellence in aparticular field or industry is obvious more likely to attract other companiesin that field, Silicon Valley would be one, Research Triangle Park would beanother.

11:05:33:18 In the case of molecularimaging enterprises, we are further feeding an image Ohio already has as astrong leader in the area of medical device manufacturing. But in another area,we are starting from scratch. We are taking steps to establish ourselves as thenumber one place in the world for the development in commercialization of fuelcells.

11:05:56:23 We must dare to dream big.We must take risks that are reasonably based upon science but there is noguarantee of return. There are certain risks in pursuing such a youngtechnology but we believe its risks will result in big rewards down the line.

11:06:17:22 We have the Ohio Fuel CellCoalition, a group of industry academic and government leaders workingcollectively to strengthen Ohio’s fuel cell industry and to accelerate thetransformation of industry to global leadership in the fuel cell technology.

11:06:34:10 We’ve established a rightcenter for fuel cells. The right fuel cell group located at Cleveland CaseWestern Reserve University, nearly two dozen companies, universities andresearch organizations collaborating on this project, which will support andresearch development and commercialization of fuel cells.

11:06:52:27 We’ve developed the Ohio Fuel Cell RoadMap, a strategy to position us as a leader in the technology. In addition,we’re funding numerous private fuel cell projects. We’ve also established thenation’s first fuel cell prototyping center at a community college in (inaud.)state or Northeast Ohio so that when the industry takes off, which inevitablywill in the next decade, we will be one of the only places in the world inwhich to find qualified technicians for this industry.

11:07:25:10 We also will be able todevelop four companies, the mass production of their relatively small-scaleoperations today. We believe our strategy is working. Last fall when we, whatwe believe is the nation’s first utility scale fuel cell power plant wentonline in Ohio.

11:07:47:03 It is providing enoughelectricity to power 180 homes in a relatively small community in Ohio but soonwe believe that there will be many more throughout our state. We are creatingan image of excellence and has companies looking into Ohio.

11:08:02:17 In a different technologyarea, Alien Technology, a California company that specializes in radiofrequency identification is seeking and has decided to locate a $10 millionoperation and a 100 job expansion project in Ohio. They like the collaborativeenvironment that we have invested in, an existing base of companies that havetalent that already existed in the Dayton area.

11:08:27:23 Not only did they chooseOhio but they immediately became involved in a collaborative Third Frontierproject, the Radio Frequency Identification Application and Education Center.We’ve also seen stories of commercial success, like the Third Frontierrecipients, Alfa Micron, which is adapting its military application liquidcrystal technology for use in consumer markets.

11:08:52:03 The resulting high-techspecs protects skiers’ eyes from changes in brightness on a ski hill and wereselected by Popular Science magazineas the best of what’s new in 2004 by Forbes in its coolest ski gear articlethis last January. So, we’ve made some investments in pure science and we’vemade some investments in commercializing new products.

11:09:18:06 Last fall, the Ohio State University credited a $2million Third Frontier grant with its ability to secure $12.9 million from theNational Science Foundation. As a result, they’re creating a nanoscience andengineering center. Perhaps most importantly to the people of the state ofOhio, we’ve seen stories on a personal triumph like that of Annette Coker ofToledo, the victim of a terrible car accident that left her quadriplegic.

11:09:51:22 But thanks to a Clevelandfunctional electrical stimulation center, a recipient of $8 million in ThirdFrontier grants, Ms. Coker is beginning to regain her independence. Asurgically implanted neuro-prosthetic has restored some movement to her leftarm, allowing her to handle everyday items, like a pen, toothbrush and a fork.

11:10:14:24 We believe that there is agreat future on the horizon for this technology and the Cleveland Clinic is atthe cutting edge in development and utilization of it. While the Third Frontierproject is shaping up to be a powerful economic development tool, it is also apowerful personal tool, improving the lives of working Ohioans.

11:10:35:19 I must, however, tell youthat it is only one tool. And it cannot obviously transform our economyovernight. It’s a long-term project that must work with other tools. It’sworking because it builds success on other programs we have in this state, likeEdison Technology Centers and Incubators to help small businesses grow anddevelop.

11:10:56:00 We’ve also reformed our civil justicesystem, protecting doctors and hospitals from medical malpractice cases. We’rereformed our worker’s compensation system and we’re reforming our tax system aswell. Most importantly, we are partnering with the higher education system.

11:11:15:11 In fact, the Chancellor ofthe Board of Regents is one of the three people who sat on the commission withme, the Third Frontier Commission that determines how to allocate funds. Wehave an enormous private sector partnership with the Third Frontier AdvisoryBoard and we do take their advice and the higher education system is a keypartner.

11:11:33:28 It’s critical that they bea key partner. Statistics on the U.S. position in higher education are not veryencouraging and they are not overly encouraging in Ohio either. The Task Forceon the future of American Innovation recently issued a report warning that theU.S. is in danger of losing its leadership position in science and innovation.

11:11:58:25 Much of its claim ispredicated on education in regard to science and engineering. More than half ofall workers with science and engineering degrees are over 40. And new blood isnot entering the work force fast enough. From 1994 to 2001 graduate enrollmentin science and engineering decreased 10% amongst U.S. citizens.

11:12:22:15 These are issues thatrequire much more time than we have today but they are issues, which must beaddressed. We cannot become complacent. America cannot afford to let ourhistory of world leadership and intellectual capital be outsourced.

11:12:39:05 The United States can bethe world’s bread basket but not without research in innovation, makingagriculture more efficient and our food supply safer. The United States can bea platform for manufacturing but not without research and innovation toincrease productivity and provide cutting-edge new product development.

11:13:00:00 The United States must bethe world leader in innovation infrastructure. Our economy and prosperitydepend upon it. We in Ohio stand with you and call upon our national leaders tomake additional investments in higher education systems, particularly in thebasic sciences and engineering, for more focus on risks taking andentrepreneurship and for policy structures to support innovators, intellectualproperty protection and industry and academic collaboration

11:13:33:24 We think the Third Frontier will help us inOhio. Themajority of its elements rely on and benefit the university structure. Thisstructure is still home to good majority of research and it’s still a goodplace to foster new ideas. The Third Frontier project recognizes this fact.

11:13:53:05 It accepts the premisethat the risk of loss is always a possibility. But the Third Frontier projectalso understands that when it comes to insuring a bright future for ourchildren and theirs, we cannot afford to abdicate. Risky or not, we must chooseinstead to innovate, to invest, to encourage bright minds to a greater future.

11:14:17:03 Thank you and I lookforward to discussing these issues in more detail on the panel. Thank you verymuch.

11:14:58:04 John Porter: Would ourpanelists please come up and take their places? I’m John Porter, thechair-elect of Research!America,and I realize the huge shoes I have to fill when Paul lays down thechairmanship this afternoon. It’s my pleasure this morning and I deem it a realprivilege to introduce our moderator for this morning’s panel discussion,veteran broadcast journalist and my fellow Research!America board member and she’s justbeen re-elected, Judy Woodruff.

11:16:19:15 Judy joined CNN in 1993and currently anchors “Judy Woodruff’s Inside Politics.” Last year, she headedCNN’s “America Votes 2004,” the network’s coverage of the presidential race.Through “Inside Politics,” Judy delivers the latest political news, interviewskey players and travels to current political hotspots.

11:16:47:19 Judy also helps anchorbreaking news and developing stories including the network’s coverage of thewar in Iraq. Following the September 11th terrorists attacks on the World TradeCenter and the Pentagon, she provided award-winning continuous coverage fromWashington, D.C.

11:17:07:23 Before joining CNN in1993, Judy was chief Washingtoncorrespondent for the “McNeil Lehrer NewsHour.” From 1984 to 1990, she anchoredpublic televisions award-winning weekly documentary series “Frontline with JudyWoodruff.” Prior to joining the “NewsHour,” Judy was chief Washington correspondent for NBC’s “Today”and she also served as NBC News White House correspondent from 1977 to 1982,covering both the Carter and Reagan administrations.

11:17:42:19 Judy joined NBC News as a generalassignment reporter based in Atlanta in 1975. She has received numerousprestigious national awards, recognizing her outstanding work as a journalist.In addition, Judy and her journalist husband, Al Hunt, have been recognized fortheir outstanding fundraising and advocacy work to fight spina bifida.

11:18:10:28 A graduate of DukeUniversity, Judy is founding co-chair of the International Women’s MediaFoundation, an organization dedicated to promoting and encouraging women incommunication industries worldwide. We are delighted to have to you here, Judy,to moderate this distinguished panel. Ladies and Gentlemen, Judy Woodruff.

11:18:42:19 Judy Woodruff: Thank you,John Porter, for your longtime commitment to science and medical research. Youare an inspiration to all of us and may I just say after everything he read inmy biography or bio that I’m just glad there’s some interest in something thesedays other than Martha Stewart and Michael Jackson.

11:19:09:22 We seem to be spending a lot of time onthose subjects as well. I am honored to be asked to be with you today to helpfacilitate this discussion, we have with us an extraordinary group ofindividuals who are going to be participating in this panel and my job isreally simply to facilitate them and to get this discussion going and in a waythat allows them to share with us what their thoughts are.

11:19:38:27 So without any furtherdiscussion, I want to get right to the panel. I’m going to introduce them oneby one and as I introduce them, I’m going to ask each one of them to make abrief opening statement, which is part of the plan. And we’re going to start onmy left, on your left, with Dr. Elias Zerhouni, who is, as you well know, thedirector of the National Institutes of Health.

11:20:07:08 Dr. Zerhouni was confirmedto that position in 2002. He leads the NIH and 27 institutes and centers withmore than 17,000 employees and a fiscal 2004 budget of $28 billion. At the NIH,Dr. Zerhouni has initiated a process called the NIH Roadmap, designed to define priorities to accelerate progressacross the National Institutes of Health.

11:20:33:27 So please join me inwelcoming Dr. Elias Zerhouni for the first statement as our panel considers therisks and rewards of research. Dr. Zerhouni.

11:20:46:00 Elias Zerhouni: Thank you,Judy. I’m really pleased to be here this morning and I’ll make brief commentsto allow more time for questions. But it was really interesting to hear theLieutenant Governor speak of his vision. I think you reminded me of a storythat I was told by a Chinese colleague from the National Academy of China.

11:21:06:13 And he said that duringthe Mao Tze Tung era, they had to maintain employment and they needed jobs sothey purposefully said that they were going to be building dams with big axesand trebles and he asked why. He said, “Well, because that gives more jobs instead of buying machines thatincrease productivity.”

11:21:27:08 So the response of thisgentleman was, “Why don’t you have them work with tablespoons and forks, therewould be [even] more jobs.” And I think that’s the challenge about innovation …that in the 21st century as we look forward to the need for us to innovate inthe changing societal environment, it is important to recognize that we can’tdo this, even as federal agencies, on our own.

11:21:51:16 And one of the things that is importanthere is to recognize the importance of organizations like Research!America. AndI’d like to publicly thank you, Councilman Rogers and Mary as well asCongressman Porter. The impact you’ve had on my life is very straightforward,with your effort by doubling the NIH budget, you’ve made my work twice ascomplicated.

11:22:18:09 But at the same time, itreally opened up opportunities that were unprecedented. And this is really thechallenge. The challenge for us as a society is to really look at what yousaid, Lt. Gov. Johnson, and that is that you’re making an investment today, butthe returns in science are never predictable.

11:22:40:19 In fact, the scientific enterpriseis characterized by frequent failure and rare success. It is the process,however, of scientific exploration that enriches our society. So I’ll justsummarize my comment about how do we maintain innovation by connecting it tothe two things that you need to do, I believe.

11:23:02:07 One is first of all, defend innovation andthe second is to promote innovation. And defending innovation is a complicatedtask as you well know. The first obstacle to innovation is what I calltransaction costs. Societal costs that increase, either they’re not justmonetary costs.

11:23:22:04 They are political costs,special interests groups and what not. And you have policy costs. You haveregulatory costs. And the typical effect of these costs is that they stifle theability for new innovators to come in and undo what was done over the manyhundreds of years that we’ve developed and then enter a new era.

11:23:45:17 So the first goal, Ithink, from the NIH standpoint as we’ve looked at our challenge was to have anopen debate about where was science and what are the challenges that sciencefaces today, relative to society and how do we lower transactional costs andpromote innovation.

11:24:02:10 So one of the things wedid in the road map was for example, to break disciplinary barriers. Whathappens in science is that you define science as good and that’s what you wantto achieve. But to achieve that, you need to have disciplines that go intoimaging or nano-technology or molecular biology.

11:24:20:29 And what happens is you then create aburden of transaction costs because the discipline then becomes an end initself, rather than a means to good science. So one of the things that Ibelieve we need to do as policy makers is to create and stimulate the ability tochange structures almost dynamically.

11:24:41:02 The second is to promoteinnovation. You have to be responsive to fundamental societal needs. And I’llgive you an example of what I said at the hearings last week on ourAppropriations Committee meeting. I said, you know, the decision we have tomake as leaders, like you do, is we have a set of resources and you have todecide where and when to invest them.

11:25:03:00 And the principles thereare very simple. In life sciences, I believe that the greatest challenge isgoing to be for us to accelerate the pace of our discoveries to make an impacton the burden of health care costs. And actually the tagline for the allianceis great.

11:25:20:03 It’s an alliance with discoveries inhealth. You have it right under the Research!America logo and I think it’s themost appropriate goal that we should have. So when I look at it, as Itestified, NIH’s budget as large as it is, $28 billion, is $96 per American,per year.

11:25:37:13 It’s $16 for the NationalCancer Institute, $10 for the National Heart, Lung and Blood Institute andothers. And I’m telling everyone, you have to look at that investment as theleveraging effect on what we as a society pay to maintain our health, $5,500 ayear, per American, per year.

11:26:00:29 When you look at this andyou look at the evolution of that, it’s going to take an increasing amount ofthe GDP of the country, in 10 years time, it will be a $3 trillion about 20-22%of GDP. And what I tell people, I say this is the greatest opportunity and thegreatest challenge.

11:26:20:12 If it keeps growing, itwill snuff out innovation. It will take away the risk capital that you aretalking about that we need to invest. On the other hand, if we’re successful asyou are trying to be, and all of us are trying to be, a .01 percent, .01percent change in the productivity of our medical system in our ability toinnovation and discoveries to not just let disease happen and strike and thentreat it but to prevent it from happening.

11:26:51:14 A .01 percent is a $3 billion opportunity.If each state in the union had one breakthrough of his nature, you would create$150 billion industry and you would preserve the ability of our country toinnovate. This is why I think we need to really generate a new class ofpioneers.

11:27:12:09 We have, for example,opened a new award at NIH, called the Pioneer Award to in fact stimulate,anchor, encourage, break down the barriers through a proactive process, which Ithink should promote innovation in life sciences because I think time is of theessence in the life sciences. Thank you.

11:27:33:08 Judy Woodruff: Thank you.Thank you, Dr. Zerhouni and I too want to add my applause to Research!Americaand Mary Woolley as I am so honored to be a member of that board and just, Ithink all of us are frankly in awe of the work that she and her colleagues havedone over the years to promote the cause of science in the advancement ofscience.

11:27:59:06 The next speaker on the panel is Dr. JulieGerberding. She is director, again, as all of you know in this room, at theCenters for Disease Control and Prevention. She was confirmed in that role inthe year 2002. Before that, she was the acting deputy director at the NationalCenter for Infectious Diseases and she played a major role in leading the CDC’sresponse to the 2001 anthrax bioterrorism events.

11:28:28:04 She joined the CDC in 1998as the director of the Division of Healthcare Quality and Promotion. Pleasejoin me in welcoming Dr. Julie Gerberding.

11:28:42:09 Julie Gerberding: Thankyou. I’m just smiling because it seems like a long time ago that we weredealing with anthrax and yet I was up most of the night dealing with anthrax.So it seems like what goes around comes around. I’m very honored to be part ofthis panel and I really look forward to hearing all of my colleagues’perspectives on this.

11:29:00:14 This is a wonderfulopportunity each year to come together and really step back away from theprocesses of what we’re doing and think about the big picture. So I thankResearch!Americaand all of you for being here to provide your perspectives and guidance.

11:29:15:06 This is really, for us actually, aconsultation where we get new ideas and new opportunities. CDC is really thenation’s health protection agency and we have a unique role, I think, ingovernment to really not just restore health but to keep people healthy.

11:29:36:01 And for those who are atrisk for diseases or disabilities to try and do whatever we can do to providethem the tools and the innovations that they need to return to its state ofless risks or better health. And that seems like a very simple mission, say fora healthier people.

11:29:50:25 But it turns out it’sfraught with all kinds of very difficult challenges particularly in thiscomplex world that we’re living in right now. And I just want to highlightthree of them that I think are very germane to today’s agenda.

11:30:03:00 The first is definingsuccess. As a nation, we have no clear vision of what health really is. And, infact, I think if you’re sitting there, just ask yourself, what is health? Whatdoes it really mean to have health? We are used to defining it in terms of theabsence of a disease or a disability or an injury.

11:30:25:02 But we haven’t come to grips collectivelyor often individually with what are we aspiring to? What are the goals? Howwill we know when we’re successful. And if we don’t know what we are trying toaccomplish, then it’s very difficult to determine what knowledge gaps do we haveor what do we need to do to be able to get there.

11:30:42:09 I think it’s a paradox inour country where our life expectancy continues to increase that people’ssatisfaction with their health continues to decline. So there is a disconnectbetween the objective measures of health that we as scientists are sointerested in and how individual citizens in our society really perceive theirday-to-day health status or the health status of their family.

11:31:09:02 This paradox for us at CDCis a mandate that we have to engage the public in the decisions about ourresearch and the decisions about our organizational goals and the decisionsabout how we engage all of our partners across the various sectors of thehealth system.

11:31:27:06 The second challenge thatcomes to mind in this context is the challenge of investment. I think Dr.Zerhouni said $96 per American on biomedical research … at CDC we’re spending,I think, by that calculus about $24 per American on protecting health.

11:31:43:22 That’s a pretty big agendafor the level of investment as the Institute of Medicine was quick topoint out in its treatise on protecting the nation’s health that 95% of ourtotal investment is based on restoring health and less than 5% of ourinvestment is placed into protecting health in the first place.

11:32:06:29 So I think that speaks toour research agenda. It speaks to our first challenge, the challenge of how dowe define success and what really are our goals and then it speaks, I think, tothe opportunities that can come from being able to leverage our investments aseffectively as possible on involving Research!America, for us at CDC, thefederal agencies, the states.

11:32:28:24 I was very fascinated withthe concept of bringing research from our governmental perspective into thestate governmental perspective or the local government perspective in the waythat you define. And we have to also be thinking about the global opportunitiesto leverage what we’re doing.

11:32:46:16 Because as we know, the world is very smallthese days and our connectivity requires us to be thinking much more than aboutthe domestic research agenda as it pertains to health. I think the lastchallenge is one that is something that I have implied about as much inpreparing for this meeting.

11:33:09:07 We did have somediscussions about how do you make prevention profitable. It is easy to see howdisease care can lead to innovations and technologies and drugs andopportunities for investment in a corporate benefit or government benefit.

11:33:30:01 But it is a little lessobvious to really connect health protection or disease prevention to the profitsector and I think this is just a challenge and an opportunity for us to cometogether in new ways and really think about how can we do a better job ofengaging innovators and [the] business sector in focusing on health protection,not just as a the right thing to do but as something that truly does fuel oureconomy and lead to the kinds of innovations and economic development opportunitiesthat we would all like to enjoy.

11:34:01:23 So again, thank you verymuch and I look forward to hearing from my colleagues.

11:34:10:21 Judy Woodruff: Thank you, Dr. Gerberding.Our next panelist is Dr. Joseph Feczko. He’s the president, WorldwideDevelopment and chief medical officer for Pfizer, Inc. Dr. Feczkco serves asPfizer’s chief medical officer, a board certified internist and infectiousdisease specialist.

11:34:30:20 His Pfizer career hasincluded positions in international medical marketing, clinical research andclinical project. He has held top leadership positions for Pfizer’s U.S.pharmaceutical’s clinical development, outcome’s research and medical planningdevelopments and medical and regulatory operations.

11:34:48:12 Please welcome Dr. JosephFeczko.

11:34:55:27 Joseph Feczko: Thank you,Judy and thank you to Mary Woolley, The Honorable Paul Rogers and The HonorableJohn Porter and all the staff at Research!America for hosting this conference,not only hosting for all the great work you do in promoting the research agendain America and as we see from today, more globally, hopefully advancing it moreglobally.

11:35:16:15 I’d also like to thank Lt. Gov. Johnson forhis reminder that investment comes in many forms and for pointing out anotherpublic-private academic type of partnership that is critical, I think, tocontinuing the innovation we have in this country.

11:35:30:19 My role at Pfizer as ascientist and physician is to really ensure that Pfizer’s medicines are fully testedand fully understood so that we understand not only their benefits but also therisks that are associated with them as well. We do this because it’s imperativethat physicians who prescribe and patients who take our medicines have the bestknowledge about what is best for them and what is best for treating theirillnesses.

11:35:59:02 I do agree with Dr.Gerberding that our focus has been and it continues to be in the industry thearea of disease treatment. And we have not been able to understand yet whereour role is really in the area of disease prevention. I think it’s a criticalquestion to put on the table and see what we can do.

11:36:15:22 We are fully supported in our researchagenda from looking at ways of improving health care systems and improvingaccess to health care. We have in community research in those areas to try tolook at health care systems both in the U.S. and outside the U.S. to try tofind innovative ways to bring these to the forefront of people’s minds.

11:36:39:12 So I think when we look atresearch, there’s a variety of areas we can get into that may impact on thearea of prevention through health access and health care delivery. One of ourmain focuses has been in the area of aging research.

11:36:55:27 And we always like to sayit’s not a matter of just adding years to life but life to years. And in doingthat, it’s important that we look at not only treatment of disease but alsowhat aspects of prevention can help maintain a healthy and productive life aswe all get older.

11:37:12:29 So I’m anxious to hearother people’s comments and to participate in the discussion and debate thatwe’re going to have about where we take the research agenda forward and how wecan work together again in this public, private and academic partnership that Ithink is critical to advancing the nation. Thank you.

11:37:32:22 Judy Woodruff: Thank you, Dr. Feczko. Thankyou very much. All right the next panelist we’re going to hear from is TheHonorable Deborah Wince-Smith. She is president of the Council onCompetitiveness. She was named to this position in 2001, is an internationallyrecognized expert on science and technology policy, innovation strategy andglobal competition.

11:37:56:07 She served as the firstassistant secretary for technology policy in the Department of CommerceTechnology Administration from 1989 to 1993. She was appointed by the Secretaryof Energy to be a member of the Secretary’s Task Force on the Future of SciencePrograms.

11:38:14:06 Please welcome Deborah Wince-Smith.

11:38:17:21 Deborah Wince-Smith: Thankyou. Thank you, Judy. Well, I’m delighted to also join this group of panelists.And let me say that Research!America really is, I think, one of our mostsuccessful models of how the public and private sectors can come together toreally affect change.

11:38:37:17 And all that you’ve accomplished issomething that we at the Council on Competitiveness are looking forward tolearning from and joining with you as we build out our “Innovate America”agenda that was released at our national summit here in Washington, back inDecember.

11:38:52:17 And I would like to alsorecognize Lt. Gov. Johnson because the Council on Competitiveness, the groupthat I lead of CEOs and university presidents and labor leaders, we’ve done alot of work all over the country regionally and we’re very proud of ourpartnership with Ohio, and I’d like to say, Governor, that not only do you aswe say, get it, but you’re building the innovation eco system and we certainlycan say that Ohio’s probably one of our innovation hot spots.

11:39:22:09 And so congratulations oneverything that you’ve done. And I want to just briefly say and the Governorreally captured this, why is innovation important? Well, quite frankly, it’sthe only way we’re going to have a standard of living and prosperity andmaintain our security as well.

11:39:40:13 The United States, we’renot going to compete on low wage. We don’t want to compete on low wage. We’renot going to compete and prosper on commoditized products, exploitation ofresources. The only way we are going to prosper is to attract high-valueinvestment and perform high-value economic activity here in the United States.

11:40:00:27 And the way to do that isthrough creating new value, new product services that compete and succeedglobally. And really the United States is at an inflection point in terms ofour innovation future and, you know, we all know many of the reasons for this,most importantly, we’re operating in a very complex global environment in whichwe have for the first time the emergence of low costs, high-value innovatorsall over the world.

11:40:31:08 We also have a globalcompetition for talent. We’re seeing that in the outcomes of the recent debateand reality of outsourcing and we’re also seeing an environment in which ourmodel of innovation is being replicated by countries all over the world whowant to create optimal business environments.

11:40:55:22 And that’s all very good.And the other exciting and challenging reality we have to deal with is that theprocess of innovation is absolutely changed as well. And, you know, for thoseof us who’ve worked in the kind of trade arena over the years, it’s veryinteresting to realize now that it’s really a changed environment in which theproducer and the supplier are no longer king.

11:41:20:14 It’s the customer and the consumer and Ithink, Julie, you commented on that in terms of the public support for healthcare and what we need to do on that. So we’ve moved from a system from theproducer calling the shots to what we would like to call at the council,co-creation, user-driven innovation.

11:41:40:01 It’s complex, it’smultidisciplinary and very importantly, it requires the integration of many,many different skill sets in an open system of collaboration, but one that alsohas some challenges on proprietary value creation. So with these changes ofinnovation, the global challenges themselves, the Council on Competitivenessreally strongly believes in our report that represented the work of over 400leaders, lead by the CEO of IBM …

11:41:48:12 … the integration of many, many differentskill sets in an open system of collaboration, but one that also has somechallenges on proprietary value creation. So with these changes of innovation,the global challenges themselves, the Council on Competitiveness reallystrongly believes in our report that represented the work of over 400 leaders,lead by the CEO of IBM and the President of Georgia Tech and cutting across allsectors is that our society has to completely optimize itself now aroundinnovation.

11:42:22:19 And that really has to beour mantra. And we looked at the innovation ecosystem and very quickly just letme mention that there were three powerful platforms that we focused on: talent,investment and infrastructure, and looked at this risk-reward continuum acrossthose platforms.

11:42:42:11 And on the talent side,let me just quickly mention a couple points. We need to encourage moreAmericans to go into math, science and engineering. And we need to do that in abold way, not an incremental way. We need to ensure that our workers have theskills to compete in this global economy, in this innovation-driven economy.

11:43:02:28 And that is an area wherethe United States,quite frankly has a lot to do. We’re spending over $20-something billion inwork force training and unfortunately, most of that money is going to trainpeople for jobs that will no longer exist in this country.

11:43:16:25 We have to ensure that we continue toattract the best and brightest to come and work in our enterprise. We haveimmigration laws that actually do the opposite. Turning to the investment, Iwas very pleased that Dr. Zerhouni mentioned the Pioneer Awards at NIH becauseactually, our recommendation in our report that all federal agencies devote 3%of their budgets to innovation acceleration awards was really based on yourpioneer program.

11:43:45:01 So again, you were therole model for what we espoused for the rest of the federal R&D enterprise.How do we strengthen our entrepreneurial economy? This is one of our greateststrengths and to build on that, I think, with what’s going on at the regionalstate level is absolutely imperative.

11:44:04:13 And I want to also mentionon investment this whole conundrum of how Wall Street invests and rewards, andthe time horizon for innovation-based investments is very, very significant. Wewere really pleased with the Council that the CEO of Morgan Stanley spent a lotof time with us to really come up with the new framework of how we want to moveforward to understand intangibles.

11:44:27:10 Right now our markets don’t understandintangibles and they don’t have a way to value that. And that’s going to be anarea of Greenfield research that we’re going to engage on. And finally in thearea of infrastructure, there’s a huge manufacturing renaissance underway andI’m just delighted to hear about, you know, your vision again in Ohio and thefuel cells with the use of high-performance computing and all these tools, wethink that the United States will continue to be a major manufacturer in thisnew value proposition.

11:44:56:23 And finally on the healthcare, I was pleased that the comments were made about the lack of productivityin this sector and that is really why we recommended that in our nationalinnovation initiative, we create a pilot around innovation and health care.

11:45:12:27 Because it really is notonly a huge importance to our economy and we know for instance that many majorU.S. companies are moving operations overseas just because of the costs ofhealth care. But that is an area where we can do a lot of the innovation andhave a lot of very powerful outcomes.

11:45:31:05 So with that, I look forward to sharingwith you some of the other thoughts of what we are doing to build out ouragenda. I will just close by saying that the council is very proud thatSenators Ensign and Lieberman are in the process of introducing omnibuslegislation to take these thoughts and recommendations and really build out apowerful legislative agenda for competitiveness and innovation.

11:45:55:06 Judy Woodruff: Thank youvery much. And Ms. Wince-Smith, may I just assume when you say you’reencouraging more Americans to go into math, science and engineering, that doesinclude women, right?

11:46:09:06 Deborah Wince-Smith: Oh,absolutely.

11:46:11:23 Judy Woodruff: Sorry, thatwas just a side note there.

11:46:20:01 Deboarh Wince-Smith: Ihave to jump into that because I’m the mother of two boys and I’m standing upfor boys these days too, so.

11:46:27:09 Judy Woodruff: I think it includes bothgenders. All right. Our next panelist is John Leonard, Dr. John Leonard. He isthe vice president for global pharmaceutical development with Abbott. Dr. Leonardwas appointed vice president of global pharmaceutical development at AbbottLabs in 1999, having joined the company in 1992 as head of the antiviralventure in the Pharmaceutical Products Division where he lead the developmentand introduction of HIV protease inhibitors, which served as we know as thebasis of effective treatment for HIV. Dr. Leonard, thank you very much forbeing with us.

11:47:05:23 John Leonard: Thank you.It’s good to be here and what I’d like to do is just maybe build on some of thethemes that the others have raised and focus primarily on the people who do theinnovations. I think there are many dimensions to what we’re talking about.

11:47:26:03 But in the end, we’regoing to need the people to actually make these innovations. So stepping backand taking a long view, I believe that if we hope to prevent and cure illnessas well as improve the health of humans, that we must understand nature. I meanthat is the essence of science.

11:47:43:22 This understanding comes from two very richtraditions: the quest for basic knowledge and the application of thatknowledge. Each of these approaches are sustained by the other. There aremyriad examples where basic and applied research are intertwined and mutuallysustaining.

11:47:59:11 And wherever we look, wesee a symbiosis between a basic fundamental science and then its application.Each of these forms of science is necessary and each holds great promise forimproving the health of the nation. So then how do we realize the benefits ofboth basic and applied science?

11:48:17:06 Well funding is always anissue, we’ve heard of some ways to go about that, certainly there’s someinteresting ideas here in Ohio,but the fundamental fact is that there cannot be good science without good scientists.And we must stimulate young people to see science again both basic and appliedas the exciting adventure that it is and one that can serve the public good.

11:48:40:12 In our culture ofcelebrity, I suspect many Americans would struggle to name a leading scientist.And I suppose now that more children aspire to playing a scientist on TV, toactually being one in real life. Statistics bear that out. Fewer Americanchildren pursue a career in science than before.

11:48:57:18 Less in the U.S. in 2004now rank 17th and the proportion of college-age students who earn naturalscience and engineering degrees. This is a trend that must be understood and itmust be reversed. Perhaps some of the wonder in the sense of satisfaction thatcomes with solving difficult problems is lost early in our students.

11:49:20:07 That weaning emotionalpull is compounded by not aggressively linking the nation’s health andprosperity to the science that undergirds it. This may be a deficiency of howwe educate ourselves but may also result from failing to stimulate imaginationand curiosity.

11:49:35:05 Taking seemingly simplethings for granted, like clean water and functioning sewage systems is thefirst step down a path that leads to assuming that antibiotics always existedand that medical breakthroughs will endlessly flow.

11:49:49:26 These are very dangerousassumptions. When a medical breakthrough does emerge, it seems that manybelieve that it was inevitable and it will be definitive. We sometimes portraythese advances as automatic, the latest model emerging from an assembly line ofinnovation.

11:50:07:06 And when the unavoidableshortcomings become clear, such as the realization new medications can haveside effects, we’re quick to call the whole process into question. Thebreakthroughs come only with great perseverance, massive, personal andfrequently financial investment and they’re rarely perfect.

11:50:25:13 The consequences of a lackof well-trained scientists are far-reaching. In the health industry, a shortageof clinical laboratory scientists affects not only patients but also the war onterror since scientists are essential in detecting and responding to theattacks involving biological and chemical weapons.

11:50:43:20 And the shortage ofscientists undermines public health measures, arguably the greatestcontributors to the strides we’ve made improving life expectancy in America.

11:51:12:25 So here in the UnitedStates, it’s crucial for all of us and certainly for the government to act nowto meet future needs in science, engineering and technology with scholarships,financial assistance and other incentives, plus a national effort to build abase of knowledge encompassing international science and engineering work forcedynamics.

11:51:32:08 Without such action, ourcountry puts itself at a disadvantage for access to life-saving advances and ithinders our defense against bioterrorism and other growing threats while notprevailing over old foes like cancer and AIDS. These challenges can be overcomebut only if there are trained scientists to lead the way. Thank you.

11:51:52:10 Judy Woodruff: Thank youvery much. I guess that was a reminder that we really are dependent ontechnology. Right? All right, the final member of our panel that we’re going tointroduce right now is Wendy Chaite. Am I pronouncing it correctly, Chaite?

11:52:12:18 Wendy Chaite is a trained attorney who, in1998, left her legal career to found the Lymphatic Research Foundation. Likemany advocates, she had a very personal experience driving her motivation. Shehas a child who was born with systemic lymphatic disease and lymphedema.

11:52:32:05 Under Wendy’s leadership,the Lymphatic Research Foundation has been instrumental in advancing the fieldof lymphatic research. Please welcome Wendy Chaite.

11:52:48:15 Wendy Chaite: Thank you.It is an honor for me to serve on this panel of distinguished health careleaders and represent the patient voice in addressing the issue of research,the risks, the rewards and the returns. When most people conceptualizeresearch, they think in terms of scientific methods applied to a process ofinvestigation with a zeal for new discovery.

11:53:12:25 But for patients and theirloved ones, research equates with hope. It is that sense of hope that providescourage and motivation for the millions struggling with diseases, each fightinghis or her private battle to confront daily challenges.

11:53:33:03 Despite the great promise research has tooffer, I don’t doubt that most, if not all of us here, whether we are providersor beneficiaries, have been in one way or another discouraged or disenchantedby the health care system and research enterprise.

11:53:48:16 Speaking for myself as aparent of a child with systemic visceral and peripheral lymphatic disease andlymphedema, the system has failed our family. For example, lymphatics have beenfor the most part, a neglected field of research. They are barely addressedduring medical school.

11:54:07:27 I can count on one handthe number of physicians who can claim to know even a little bit aboutlymphatic diseases and lymphedema, and if one considers treatmentopportunities, these are primitive, often lacking scientific validation,pharmacological support and are in large part not covered by insurance.

11:54:28:23 These shortcomings are notunique to medical problems faced by the patients I represent. Countless otherdisease entities can be represented on this panel and would undoubtedlyunderscore similar inadequacies of the system. Hence, it is the collectivevoice of patient advocates that I represent today.

11:54:48:23 Despite the great progress of science(inaud.), the system has inadvertently abandoned the patient community and thepublic at large from access and quality of care issues to trust andtransparency to unsafe drugs in the marketplace. I would not be so arrogant asto propose a solution.

11:55:08:13 The issues are complex.Politics, self-serving interests, territorial and competitive issues ofteninterfere with making significant, meaningful and lasting improvements. Soperhaps the most meaningful message I can reinforce today as we look toinnovation and building alliances is to underscore the urgent need toreprioritize components of this complex research and health care system.

11:55:39:15 It is imperative toconsider methods and processes that will be responsive to human disease andpreserve human health. This applies to both public and private endeavors. Humanhealth is about people, yet somehow within the evolution of our research andhealth care system, the patient has been placed on the sideline.

11:56:02:17 Most times, we are not part of the process,not part of the conversation and, at times, entirely disregarded. Not all isbleak. In some arenas, we’re witnessing early indications of a movement ofpatient inclusion. As represented in the roadmap and COPR, nevertheless toenact meaningful change, the current mechanisms that shape and control ourresearch enterprise and health care delivery system must regroup, reorganizeand establish new paradigms that incorporate a genuine responsiveness to thepatient voice.

11:56:40:23 The rewards and thereturns of such effort are self evident. Recent history highlights the risks.The collective failures that have been illuminated over the last decade are fartoo-costly in time, money, energy and, most importantly, lives.

11:56:57:26 On behalf of all patients,please help us maintain a spirit of hope and may the concept of innovation be agreat opportunity to include the patient.

11:57:18:13 Judy Woodruff: Thank youvery much, Ms. Chaite, and as the mother, a parent ,of someone who was bornwith spina bifida, and later experienced a brain injury, may I associate myselfwith your remarks as with the patient community. I also want to recognizeagain, Lt. Gov. Bruce Johnson, of the state of Ohio.

11:57:38:16 We’re fortunate that you’re going to behere joining us for the panel, in addition to the remarks that we hear from youearlier. I wanted to start with the question about resources but I think givenwhat we just hear from Ms. Cahite, I thought I would, without putting anybodyon the spot, I thought I would first ask Dr. Zerhouni and Dr. Gerberding torespond to what we just heard from her as an advocate for patients. Dr. Zerhouni.

11:58:01:29 Elias Zerhouni: First ofall, I think that it is very important to not just talk about involvement ofpatients in the research process, but institutionalize it. And this is where, Ithink, Wendy was mentioning the road mathematical research, and we haveidentified this as an issue that actually was brought up to us by scientiststhemselves.

11:58:25:18 It turns out that unlessyou have in today’s world the ability to interact with communities of patientsand then include them in the communities of research that you need, you can’tconduct your research. It’s that simple. And the reason is obvious for all ofus to see.

11:58:43:16 And that is, over the past 30 or 35 years,the landscape of disease has changed. We’ve gone from a world where diseasestended to be short-term [and] lethal to a world where we have, we can nowsurvive and live with chronic diseases, cancer for example, the survivorshiprates in cancer has doubled.

11:59:07:04 And in conditions like theone you’re mentioning for your child, it’s the same issue. The issue is youcan’t really conduct research without now involving aggressively the patientcommunities for them to participate in the research.

11:59:23:02 Now as we look at that, itis also obvious that public trust is going to be critical. And we can’tmaintain public trust without transparency and the obvious comments that weheard are, this is work in progress, we need to continue to do that.

11:59:41:09 So that’s my response. I think, asscientists, we absolutely understand that there will be no translation offundamental discoveries without involvement of patients in communities ofresearch. It’s a new concept really, which I believe personally needs to beencouraged and stimulated by making sure that the ivory towers of academichealth centers, which used to care for patients who would come for staying forweeks on end in academic centers, is no longer the paradigm of today.

12:00:11:00 Patients come for a veryshort time, then go back to their communities and therefore we need to adapt tothat.

12:00:17:11 Judy Woodruff: Dr.Gerberding.

12:00:17:11 Julie Gerberding: Thankyou. I was just thinking about I started my medical career at San FranciscoGeneral when the first AIDS patients were being recognized and admitted to thehospital and they were my best teachers. I really think that growing up in thatparticular environment professionally and learning about the power of thepatient and the wisdom of the patient and the ability of patients collectivelyto not just advocate for specific kinds of treatment or specific kinds ofrespect, but to really teach us about how critical the patient really is in thecontext of medical decision making and how vital it is to the successfuloutcome.

12:00:59:27 That’s just something that’s been part ofmy professional development in coming to CDC, which is a public health agencyand really recognizing that the public is not necessarily a collection ofpatients but a collection of people.

12:01:11:25 We can’t do our job if wedon’t really engage people in the process of determining our priorities andcertainly our research priorities. We have a little bit of practice with this.I think the community base participatory research model that we’ve used, whichrequires investigators and academic centers to engage the affected populationin the design and development in formulation of the research and also toparticipate in the whole process of conducting the research and evaluating whenit’s over, has been extraordinarily successful.

12:01:44:15 And I wish someday I couldtell you some of the wonderful things that have happened through application ofthat model in a variety of communities. But it’s just the first step. But Iagree with Dr. Zerhouni. This is learning, and not everyone within CDC or evenwithin the public health community thinks this is the right thing to do.

12:02:02:17 There are still a lot of people who believethat “we know best” and that we’ll tell you what is the right thing to do. SoI’m learning and relearning and experimenting with new ways. It is a processthat takes time and patience but also leadership.

12:02:19:07 And I think around thistable, we’re very committed to that at least in concept.

12:02:22:00 Judy Woodruff: Anybodyelse want to comment? Ms. Chaite?

12:02:23:27 Wendy Chaite: I just wantto say I happen to be a member of the NH Directors’ Council PublicRepresentatives, COPR. And I encourage each and everyone of you on the way out,there’s a sheet of paper there from the COPR Web site, various reports thatwere very meaningful and thought-provoking on the issues of public input intransparency and the like.

12:02:49:29 And I think that takingthe time to read those reports and hearing from the public the views, we’rereally out in the trenches. We live it. And I think taking the wisdom that wecan share will help you effectuate a better tomorrow for all of us.

12:03:09:11 John Leonard: Yeah, if I could just add.Speaking from a company’s perspective, which is a very different agenda I supposethan from publicly funded research, for us it doesn’t always start withpatients coming to us. We look at it from a perspective of problems that we cansolve.

12:03:31:04 I mean, this is a very,again, going back to the comments I said, applied approach. We think of where’sthe science permissive? What can we do to actual solve a problem? Once we havean understanding of how we think we can proceed, we attempt to engage patients.

12:03:47:10 And I know, again back tothe AIDS history, we’ve had patients sit down and help design the very trialsthat we’re going to do because they are ones who are going to be subjects inthose trials.

12:03:59:19 Wendy Chaite: May I justmake one comment. We all talk about translational research frombench-to-bedside and perhaps especially for industry, looking at it actuallyfrom bedside-to-bench-to-bedside, might be a good way to start.

12:04:15:10 Judy Woodruff: OK. I want to get back,thank you very much. I want to get back to something that Dr. Zerhouni, acouple of things that he said about the big challenge to accelerate the pace ofdiscovery. He went on to say right now we’re spending what, about $5,500 peryear, per American on health care.

12:04:34:03 He talked about it takingan increase in the percentage or the amount of the gross domestic product andhe said, but we’re simply a .01 percent change in productivity of our medicalsystem; that’s $3 billion opportunity. I want to come to both DeborahWince-Smith and Lt. Gov. Johnson to ask if that’s realistic or is that pie inthe sky? What do you think, Gov. Johnson?

12:04:59:09 Bruce Johnson: One, I’mnot an expert in the field. I do know that the cost of health care is achallenge for everybody. We happen to be a massive employer in our state and sothe increase in cost of health care are a challenge there. But we have starteda partnership between various of the health care institutions in our state andthe government on a focused area in the computational medicine that the folks,particularly at Ohio State believe can overtime reduce the costs of health care when the research is fully utilized.

12:05:33:02 And so perhaps there can be focusedresearch dollars on health care costs and health care delivery and reducingunnecessary steps in improving the productivity of the health care system as wemove along. This challenge in state government budgeting for example, if wecould put a reasonable amount of resources on this issue of improving healthcare delivery, but at the same time, being more productive, then we couldbalance the budget in the meantime.

12:06:09:25 Because clearly the animalthat is eating our state’s budget is the Medicaid system.

12:06:16:17 Judy Woodruff: Dr.Zerhouni.

12:06:16:29 Elias Zerhouni: I’d liketo comment, if you don’t mind. There are two approaches to this and I’mreferring to one of them. There’s, I mean, obviously improving productivitywith what we know today. The question that you ask, Judy, is this really pie inthe sky about us being able to control these costs over time?

12:06:37:29 I would agree that if we do not innovate,it is pie in the sky. And the reason is very simple. And that is health caredelivery is very people dependent. And therefore it’s very hard to improveproductivity without new discoveries and new innovations.

12:06:50:15 So when I say .01 percentincrease, I really imply understanding at the fundamental level the path ofbiology of disease years before it strikes. It’s a little bit what mycolleague, Julie Gerberding, was saying. If you intervene at that point andtime and you prevented the $1 million transplant or the $100,000 by-passsurgery, you could really make an impact.

12:07:17:14 And that’s what I’mtalking about, fundamental, new discoveries that will enlighten us about thedisease process years before it strikes. Best example is diabetes. I mean,we’ve known that diabetes is due to a lack of insulin for 75 years.

12:07:31:05 The question is what, inthe complex protein networks that act 20 years before diabetes sets in, what isit that you could intervene in to prevent that from happening. And we’re seeingthat already. I mean, with statins, we are seeing a marked reduction in heartdisease and coronary heart disease.

12:07:51:17 So it’s not pie in the sky, but it will bedependent on practicing medicine in 25 years in a way that is completelydifferent than we practice it today.

12:08:02:19 Judy Woodruff: Dr. Feczko.

12:08:04:05 Joseph Feczko: Yeah. I wasjust going to echo some of what Dr. Zerhouni and Dr. Gerberding were saying, isthis gets us into the prevention area again. So there is a certain amount ofefficiencies you can always get out of any system. And the health care systemhas never been viewed as a terribly efficient one just because of the nature ofthe way it’s been done.

12:08:17:19 There’s a lot we can doprobably with better IT systems and linked medical records and things likethat. But having said that, prevention is the key. I mean, everyone knows thatpreventing a disease is much, much cheaper than treating a disease.

12:08:27:27 And if we can keep peoplehealthier and whether that’s through better understanding, better diagnosis,earlier diagnosis, work we can do to maintain better health, body weight, whathave you, we can go a long way to actually spreading the costs of health caremuch more broadly.

12:08:45:11 As we see, the costs goesup as we age. And a critical issue here is to keep people healthier as they ageso they can be more productive in life, so they’re not so consuming of thehealth care system.

12:08:56:23 Judy Woodruff: We heardDr. Gerberding say it’s just 5%. You’ve got 95% of the health care dollar goinginto care and treatment, 5% into prevention. It’s extraordinary, isn’t it? Or,prevention is so important.

12:09:12:07 Elias Zerhouni: Sorry, ifI may.

12:09:14:03 Judy Woodruff: Sure.

12:09:15:10 Elias Zerhouni: If youknew everything there was to do about prevention today, then I would sayabsolutely. The fact is that if when I go to assemblies of scientists andpublic members and I say how much do you think we know of what we need to knowto be effective, you know, mechanically effective so that Dr. Leonard andFeczko can develop and apply?

12:09:40:00 You know the answer I get is that we knowabout 10% of what we need to know. We have no clue right now on why a dopamineneuron loses the ability to produce dopamine. We have 11 different theories butboy, if we knew what happened at age 40 or 41, we could intervene.

12:09:55:00 So in many ways, theimbalance is reflective of our ignorance. That’s the point. And the fact thatwe’re so ignorant forces policy choices to be directed to spending at the endof the disease process.

12:10:10:01 Judy Woodruff: Well, howmuch of that ignorance is a function of the priority the way dollars have beenspent, that they haven’t been put into basic research?

12:10:18:27 Julie Gerberding: Youknow, I would just say a couple of weeks ago, there was a wonderful pressconference here in Washington on the success of the tobacco campaign. We havethe lowest ever tobacco utilization rates among teenagers in our country and infact, even among adults.

12:10:33:15 We’recontinuing to see some fairly steady declines at least in the states that areusing their tobacco dollars for these purposes. And it was fascinating to mebecause you can attribute about 26% of the decline in adolescent tobacco usedirectly to this campaign and in a dose-dependent way.

12:10:51:05 So the campaign works.But, you compare what’s being invested in the campaign to what the tobaccoindustry is investing in tobacco promotion, and it isn’t even close. And sothat’s where we have the struggle. Yes, the knowledge and the innovation andprevention needs to be stimulated, but there are things we know right now thatare working and we’re still not investing in them.

12:11:17:20 Deborah Wince-Smith: I’dlike to comment on the aspect that nobody’s really mentioned yet about thiswhole health care system is a business. And the fact that it does have very,very low productivity. And the fact of it is the only reason why the UnitedStates has done so well in the last 10 years compared to the rest of the worldis we have the highest productivity across virtually all of our industries,with the exception of health care and education, that are very low [inaud.] …

12:12:04:22 … [In] Americawe’re outsourcing and, you know, manufacturing movement overseas is whathappens to that health care. So toaccelerate portability of health care and pensions are two huge issues that arepart of this innovation challenge. Theother area that I think needs to be mentioned is the pivotal importance of tortreform.

12:12:26:23 Share somestatistics. Right now the United States,and this is a conservative number, we spend close to 2.3% of GDP on tort payout. No other country in the world has that burdenimposed on us. It’s a chilling effect onresearch. It’s a chilling effect on whatcompanies do.

12:12:47:14 And there hasto be some rationality brought into that. So there are a whole set of business parameters, you know, the thirdpay… I’m not an expert on health carebusiness by any means, but I do know that some people who are have told usthat, yes, IT systems will improve.

12:13:02:13 They’ll bringbusiness efficiency into it. But we’renot going to solve the health care system with IT alone. And so I think one of the challenges here ishow you treat this as a very important competitive business, but at the sametime bring the human element and the patient element because, again, I was-Iwas very interested in Wendy’s comments because I made that little reference inhow innovation has changed, that it’s user driven, and yet you mentioned thatfor the most part the patient, the user, the end customer is really not upfront.

12:13:36:28 And that’s adifferent situation that almost in any-every other activity…

12:13:43:08 John Leonard:Can I just build on the $5,500 number? It’s an instructive number, but I’m sure that’s arrived at by adding upa bunch of things from many different columns and coming up with a total anddividing it.

12:13:55:01 EliasZerhouni: No, that’s the G-O study.

12:13:56:12 John Leonard:No, no. I’m not saying it’s a wrongnumber … Well, my point exactlythen. Okay. But I think one of the limitations is that noone really is responsible for that number. So there are many different pigs that feed at that trough if you want toput it in those terms where we don’t optimize what we get for that $5,500.

12:14:21:27 So I don’tknow what the right number should be for prevention. I mean, a question is, “Well, what could weprevent and do we maximally prevent it?” I mean, you’re obviously saying that we don’t solve a very basic problemlike tobacco use.

12:14:35:29 But I think wehave so many different sources of information and people who are responsiblefor small slices of the pie that if we attempt to optimize within thoseindividual slices, we don’t optimize across the entire health care dollar.

12:14:51:29 Judy Woodruff:One question I have from some of the literature that I’ve looked at. It seems to me the public is in favor ofincreased research. They seem tofavor… They understand that medicalresearch, science-basic research, as much as they understand, it isimportant. And, yet, that willingness tosupport that isn’t always translated from the-from what is at least in theperception of the public to the policy makers.

12:15:16:29 Why isthat? What are we not doing here? What should we be doing? You know, how are decisions getting madeabout these things?

12:15:26:28 And what’sright with it and what’s wrong with it?

12:15:29:00 John Leonard:OK, could I say one thing? I don’t knowabout what research means to most people, but where I live and what I do, whichis clinical research, you know, we go and develop drugs. What we see is, generally speaking, a declinein the willingness of patients to participate in clinical trials.

12:15:47:08 What we’reseeing increasingly in our industry is people moving clinical trials offshoreto lower cost providers. That’s one… You know, it’s an economic reason, butalso it’s the availability of patients who are willing to participate in theclinical trial process.

12:16:05:22 I think goingback to this notion of social responsibility and looking at health investments,whether it’s time, volunteering or dollars as a social good, I think it’salways easy to ask another person to participate in the clinical trial and todecline participating yourself unless you have some very significant pathologyfor which participating in that trial is synonymous with getting care.

12:16:34:08 Other thanthat, we find that a lot of people turn away and don’t participate.

12:16:40:15 Judy Woodruff:Anybody want to pick up on that? Dr.Zerhouni.

12:16:42:21 EliasZerhouni: You asked the question about what’s the disconnect between researchand policymakers, and I thought that there’s no proportionality between theimportance that we hear or see in terms of ability to innovate and improveproductivity with not just doing better what we know today, because at the endthat’s limited when you’re dealing with a people-intensive activity.

12:17:05:28 And when youlook at policy makers … I have aprovocative statement to make and I’ll make it to the Lieutenant Governor. Every political race that is run in thecountry is determined by “Have you created jobs? Have you created an economicenvironment?” I haven’t yet seen a racewhere the health of the people in that district, where an indicator to the sameextent, you know, housing markets and economic growth and job creation were.

12:17:41:16 If we coulddevelop … And I think Dr.Gerberding is doing that. I mean, she has a terrific new surveillancesystem. Looking county by county aboutwhat the health of that population is and if the representatives understoodthat lacking an objective improvement in either education, by the way, I mean,I think that’s an important parameter, or health.

12:18:05:07 If we couldsomehow change the culture so that accountability of the political level,policy maker level, was connected to indicators that are different than whetherthe stock market goes up and the job market is… Something like this is, in my view, something that we need to talkabout.

12:18:22:00 I don’t havethe solution, but disconnect might be there.

12:18:28:06 Bruce Johnson:Let me… I agree with much of what yousaid. Trust me, Politicians can getfrustrated with the basis upon which the public and the private sector andindividuals make decisions in themselves. But what many of others have done is instead of trying to fight thattrend…

12:18:44:26 It’s verydifficult to change what people perceive as the most important thing in theirlife. So if they perceive that thethreat to their economic stability is the most important thing in their life,my view is go with it, but also suggest how improvement in health care,improving research impacts.

12:19:06:00 And that’swhat we’ve tried to do with this Third Frontier initiative. For example, trying to suggest thatimprovements in research and improvement in the quality of life actually has apositive impact on your employability over time. So you can utilize your research initiativesand the improvement of the quality of health care as an advantage to the otherthings that people care about.

12:19:30:14 How theirchildren are going to grow up, where they’re going to be educated, when they’regoing to be educated, what they’re going to utilize those tools for in terms ofthe job market are all part of the health care system. And so I think it can be utilized in that wayas opposed to trying to change what their own priorities are.

12:19:48:20 DeborahWince-Smith: That’s a-that’s a great, interesting, interesting idea. And there’s already some activity where it’sshowing the value, what you said, Dr. Zerhouni. In some of our regional innovation work we’ve been able to document insurveys that parts of this country that are attracting some of the best and brightestentrepreneurs and developing very dynamic innovation clusters, the whole healthcare infrastructure in those communities are either an attractive magnet forpeople or the cost, the unavailability of what they deem to be first-tierhealth care keeps them away.

12:20:25:10 So right now that’sa metric for where people want to live, raise families, do work. And then the other interesting piece of thisis that some new research is being begun and we’re working with some economiststo actually develop a metric to look at health care, not as an outcome ofeconomic growth, but as a productivity enabler.

12:20:48:01 And that’ssort of Greenfieldresearch and it completely changes the debate again about how the investmentswill be made. But this is not somethingyou get after you’ve had a certain standard of living. But it drives all of that.

12:21:00:22 Wendy Chaite:I think Research! America, I’m on their board, that’s really one of themessages with the economic impact, with… And I think it’s something to reinforce. And I’d like just to highlight that just as Research! America’stagline is “An Alliance for Discoveries”, I think there’s great opportunity foralliances beyond just within Research! America.

12:21:23:03 I mean, thereneeds to be alliances even within HHS. There needs to be alliances between government and industry. We all really need to find that very bigsandbox and work together to solve the problem because we’re talking aboutpreventing disease, and well-being. Anduntil the infrastructure invites that and supports that, I think so much ofwhat we do is based on Band-Aid responses and sort of picking up the pieces.

12:21:57:10 And, you know,as a former attorney, you know, the whole tort reform, it’s everybody sort ofvying for their piece. So I think thatthrough the concept of innovation there’s tremendous opportunity to create anew paradigm. And I know it’s verydifficult because, look, just even in the academic institution, an individualresearcher’s promotion is based on self-preservation of publishing singularly.

12:22:25:00 And so he,obviously, or she, has to raise a family, you know, put their kids throughcollege, so they’re going to sort of think about themselves. And, yet, as we can see, collaboration andworking together and creating alliances is really the answer. And, yet, our system does not lend itself.

12:22:45:21 So unless wereally examine the system, whether it’s in the academic institution or whetherit’s even industry and how industry works and the motivating factors, and if weall can just sort of put our egos aside, our agendas aside and work together, Ithink we can come up with some very wonderful solutions.

12:23:08:05 Judy Woodruff:This may not be the best town to talk about putting ego aside. I’m sure it’s true everywhere. I want to… Before we take questions from the audience, and we do want to do that, Iwant to raise something that’s, of course, been in the news recently aboutthe-what we know to be risks with pharmaceutical discoveries.

12:23:26:15 Let’s talk fora minute about how do we talk to the public about the very real risks withmedical research? One of you said thisvery, very eloquently. That it’s notalways a straight line. I mean, thereare zigs and zags along the road to finding the right answer.

12:23:48:23 So let’s talkabout, you know, the risks of research at times, the risk benefit ratio of-inconnection with that of speeding up or slowing down the Food and DrugAdministration approval process. We’regoing to be hearing from the Acting Head of the FDA at lunch, but who wants tobegin that conversation? Yes.

12:24:07:19 Joe Feczko:Well, since I’ve been intimately involved in this for the last severalmonths. You can look at risks from acouple different ways on this. There’sthe risk of the research. And, as Dr.Zerhouni said earlier, that, you know, there’s no guarantee that when you godown a path that you’ll actually come to something that’s productive at the endof it, there’s a lot of false starts and false stops and that you end up havingmore failures than successes.

12:24:38:06 But even whenyou have those successes in the area of pharmaceuticals, for instance, and itcan be… I think we can extrapolate thiseven to medical interventions, either surgical or what have you. There are certain things you can know earlyon. And this issue of risk-benefit issomething that we’re losing track of a bit.

12:24:56:08 And maybe wejust haven’t done a good enough job of really talking about it and educatingthe public. That there is no such thingas a risk-free medicine. If a drug ispharmacologically active, it’s going to have side effects. If it doesn’t have side effects, it’sprobably not going to be pharmacologically active.

12:25:10:00 And we don’tget that message across. Now how do wetrack that and how do we understand that and how do we not only find out whatis going on with those drugs but how do we communicate to the public? And I do agree that there has been some gooddiscussion lately about the need to enhance the drug surveillances.

12:25:26:01 I don’t thinkit’s a matter of slowing down the process at the FDA. I don’t think that’s necessarily a good thingfor anybody cause it doesn’t bring innovation out. And at the end of the day, no matter how manypatients you study pre-approval, rare side effects and usual side effects arestill never going to be found.

12:25:38:15 It doesn’tmake any difference whether there’s 10,000 patients, 20,000 patients,30,000. You really don’t find what couldbe potentially a problem and put that into context of the benefit until thedrug’s actually being used. But thething is how do we track that?

12:25:52:08 We have aterrible system right now around the world actually and in the U.S. fortracking that. We rely very heavily onspontaneous event reporting that may or may not have anything to do with thedrug that’s being given. It’s reasonablefor detecting signals but not for really analyzing what’s going on.

12:26:07:08 And Ithink-I’m hopeful that some of the discussions that are going on with the FDAright now… And actually, to be honestwith you, it started a couple of years ago with the (inaud.) legislation. There was money put aside and there wasthinking behind that a risk-benefit analysis, after drugs are on the market,risk management epidemiological studies, that should be really done much moreproactively in a much more structured way so we can analyze what’s going onrather than…

12:26:31:15 Judy Woodruff:One thing I’m curious about is how do you keep expectations realistic? You can hardly turn on the television now andnot see an advertisement for a pharmaceutical product with, in many cases, verygrand promises, and anytime day or night when you turn on… So how do you-how do all of us, you know,gear that down a little bit and, you know, make it a more realistic dialoguethat’s going on and set of understandings? Dr. Leonard, do you want to jump in?

12:27:03:03 John Leonard:Well, I don’t know the answer to the DTC thing that you’re raising,direct-to-consumer advertising. I think,in many respects, it’s overdone and overstated. And I think that that needs to be coupled with exactly the point you’remaking here which is an ongoing assessment of the risk benefit analysis forindividual patients.

12:27:24:10 We can’t let people, patients, you know, come in with afalse sense of expectations, realizing that-thinking that there’s no downsideto taking a drug. It’s just nottrue. You know, there is a very basicproblem tied to innovation. I mean, ifit’s true innovation, it’s making something that’s new.

12:27:46:04 It may neverhave existed before. And when a new drugcomes out, typically that will be explored in a few thousand people,5,000-6,000 I think in the case of Viox, not to pick on that particularly… But it’s an illustrative example. I think in the original new drug applicationthere were 5,000 people exposed.

12:28:05:08 That’s afairly good-sized, new drug application. In the United States ultimately over 20 million people were exposed tothat particular drug. And if you thinkabout it, there’s this ongoing continual expansion in what we know about thisnew thing that originally was exposed to only 5,000 people.

12:28:27:10 And to believethat what we learned from those 5,000 people will illustrate and exemplifyeverything that will ultimately occur in the 20 million people who ultimatelytake it is absurd. And so you have tocome back to this notion of shared responsibility. The company which, in this case, innovatedit, whether it’s Abbott or Pfizer or Merck or whatever, we can only know whatwe see directly in experiments that we do.

12:28:59:11 And then onceit’s released to, call them, “free range” patients and “free range” doctors whomay operate with the guidance of a label, they too have a responsibility, whichis when they see something, to report it. And then we-and we hope to shore up how and where we get thisinformation so that this continual learning that takes place will let us resetthe bar between the risk-benefit analysis.

12:29:25:22 It is neverdone. And I think that one of theproblems we face is that we have this, and I say “we”, we Americans have thisdesire to make it sound all so simple and so neat and formulaic. It’s not. It is a continual process. Andthat’s what comes with innovation.

12:29:47:28 Judy Woodruff:Well, certainly the media has a role. Anybody want to comment on that any further before we take questionsfrom the audience?

12:29:53:21 DeborahWince-Smith: I have one comment and this is just an interesting model. When all the publicity came out about thedownsidesof hormone replacement therapy, many different articles and-it wasinteresting to see how individual women’s and women groups came together aroundthat.

12:30:10:23 And it’s interestingthat none of those medicines have been pulled from the market, but what hasoccurred is that women are making their own risk assessments. And I recently asked my doctor and he said80% of his patients who went off those medications are now all back on thembecause they have personally decided that knowing the risks, this is what theywant to do and are tailoring it to themselves.

12:30:33:28 And so it’s aninteresting sort of example of how that education process was dealt with. And, again, building on what you said, thepatient took responsibility. They gotthe knowledge, they got the information, they worked with their doctor and theydecided what they were going to do.

12:30:50:25 EliasZerhouni: I think it relates to what I said before as well. And the-and that is that the pattern of useof medications in this case or whatever procedures would come up with ischanging. It has changed. Seventy-five percent of our expenditures arerelated to chronic diseases.

12:31:06:12 So what you seea lot is long-term utilization. Likehormone replacement therapy is one example, hypertensive drugs is anotherexample, Cox (ph.) 2 inhibitors and… Sowhat you’re seeing is a change in the pattern that has never occurredbefore.

12:31:23:14 Historically,we had treatments for cancer, for example, and you made it or you didn’t makeit, and heart disease you intervened … Antibiotics was the paradigm. Youknow, you found one molecule that really controlled an infection, you were backto health. That paradigm is not-nolonger operating.

12:31:40:20 And I thinkDr. Leonard is saying it well in the sense that we do not really have a good,core surveillance system in the country that looks at the denominator. So, yes, we report complications, but youreally have no idea of how many patients really took that drug.

12:31:58:16 And it’ssomething that we need to tackle. I knowthe FDA is leading an effort in that regard. But as a society, I think, we need to also realize that we have alsobecome better scientifically at identifying risks. See, the effect of all these news that areco-the news that you-the media also sometimes amplify is related to bettermethodologies for us to find biomarkers that are indicative of a particularrisk than we did before.

12:32:28:09 So for 30years the dogma was that hormone replacement therapy was good until NIH did awomen’s health initiative. And $600million later we’re finding all of the issues that were dogma before… The same thing is true in they all had trialthat was done by the National Heart and Lung Institute in terms of usinghypertensive drugs.

12:32:49:04 But it is notpossible, I believe, to impose the costs of doing this one at a time. We need to come up with a smarter systemprobably with a surveillance mechanism and better information technology to dothat.

12:33:06:08 Judy Woodruff:All right. Thank you. Now we want to take some questions from theaudience. I’m going to ask you to stand. Do we have a microphone? I think we’ve got a couple ofmicrophones. If you could stand and giveus your name and a question. We haven’tfrom Dr. Gerberding in a few minutes so we’re especially interested inquestions for her.

12:33:18:29 But that’s allright, if you don’t have one for her, you can start with someone else. Yes, sir.

12:33:24:20 AudienceMember: A question about globalization. A major issue in this country, when it comes to globalization, isoutsourcing. And up until now we’ve beenthinking about outsourcing in terms of manufacturing in certain servicefunctions like call centers and clinical trials.

12:33:45:16 Now we’rebeing told that a trend is emerging in this country of outsourcingresearch. This week’s issue of Business Week there’s a cover storysaying that more and more American firms are outsourcing their researchactivities. And my question is to boththe government and the industry representatives here, what are the long-termimplications, if this is, in fact, a trend, on things like the employment ofAmerican Ph.D.s in Americaif this happens?

12:34:21:28 Judy Woodruff:All right. It’s a pretty directquestion. Who wants to start? Dr. Feczko.

12:34:25:17 Joseph Feczko:Well, if it really does move to the point of aggressive outsourcing of basicresearch, it could have a very significant impact. You see this already in places in New Yorkwhere major research centers have moved out of Switzerland and Germany and havelocated, actually, to the U.S. for the most part.

12:34:45:24 So it could ifit’s really happening. To be honest withyou, I don’t really see that happening. I’m not too sure of the statistics on the basic research or Ph.D. typework going off-shore. We, as a company,are a global company.

12:34:59:20 We actually doresearch in Asia. We do research in China. We do have centers set up there. We have centers set up in India. But it would be foolish for us to think thatwe are-even though we’re an American company operating globally that theChinese or the Taiwanese or the Koreans only want to see American data.

12:35:17:00 And so we dohave a global operation. I know for afact that about 80% of our basic research and development costs are in theU.S. So I’m not too worried about that. Though, we do have plans to expand and we doexpand overseas really at the request and the need, because we’re a globalpresence and we are there.

12:35:35:03 Hopefully, Ithink that we still… As long as theeducational system is good, as long as the reward for innovation stays high inthe U.S., I think every company would be foolish to take that innovation, thatresearch outside the borders. But it’snot to say that as a global company we wouldn’t be seen to be doing someresearch in those areas.

12:35:55:21 Judy Woodruff:So… But you mean the story may beexaggerating the problem?

12:35:58:20 Joseph Feczko:Well, I don’t know. I’m sure it’sthere. You know, I hadn’t seen thatarticle exactly and I know there’s been a lot of talk about off-shoring, and Isee it happening. I just haven’t seen ithappen to that extent with the high-level Ph.D. basic research type of work.

12:36:12:07 JulieGerberding: Now I would just say that from a CDC perspective we have a fairlyrobust global research agenda and portfolio and actually are actively intentionallyinvesting in various parts of the world where we’re learning how to prevent HIVinfection or reduce malaria or create better clean water systems, etc.

12:36:30:19 So, for us,the global environment is an enormous opportunity for us to leverage what weknow here that’s applicable there, but also to learn there what could beapplicable here.

12:36:40:16 Judy Woodruff:All right, a question here. If you wouldtell us your name first.

12:36:42:22 MS: [VERY LOWAUDIO] My name’s Ian Phillips and I’mfrom the University of South Florida. I just want to bring up something aboutresearch and researchers. And Dr.Bennett, I think it was, said that we need scientists. When I looked at the hundred or so researchercolleagues that I have and asked them if their children are in research, Ithink all of them said “No”.

12:37:08:05 And the real question is why are their childrenseeing their parent’s lives so unattractive? Well, one thing is (inaud.) myself. (Inaud.) coming from NIH (inaud.), but we constantly live on the basisthat you’re only as good as your last (inaud.). We constantly fight for (inaud.).

12:37:35:14 And weconstantly struggle (inaud.)… [PEOPLEWHISPERING IN MICROPHONE AT SAME TIME] …that make life more administrative than innovative. So I think some consideration, I certainlydon’t (inaud.), needs to be given to the life of scientists (inaud.) youngpeople to be scientists.

12:38:00:00 Judy Woodruff:Dr. (Inaud.)? Who wants to…

12:38:02:12 EliasZerhouni: Well, I think these are-this is an excellent point. And, in fact, when you look at the prospectstoday for an investigator in life sciences… And we’ve looked at that. We’veactually worked on the issue of the life cycle of scientists. So here’s the picture. I can give you an example.

12:38:22:21 Dr. MarshallNuremburg was the Nobel Prize winner. Hewas on the NIH campus. He had anindependent laboratory at age 27, he unraveled the genetic code at age 31 andhe received his Nobel Prize at age 35. Today, to get your first grant at NIH, you have to be about 37, 38 yearsold.

12:38:46:14 Only 4% of ourgrantees have a grant at less than 35 years of age. So what we are seeing is, in fact, asclerosis. This is what I mean bytransaction costs sort of taking a burden or impeding, if you will, the careerprospects. So what’s a career prospectnow?

12:39:06:27 You go tocollege, 22, you go to graduate school, another… If you would do a Ph.D., it’s another seven,eight years. And then you do apost-doc. And the post-docs used to betwo years; now they’re six, seven years. And by the time you become competitive for an independent researchcareer to be an assistant professor and so on, you have children and you haveall that.

12:39:27:26 So we have adisconnect between the demographics of the scientific work force and thepolicies that we have developed over the years. There’s a report from the National Academy of Sciences. We’ve asked Dr. Tom Cech, who’s the presidentof the Howard Hughes Medical Institute, to look at that issue.

12:39:46:00 So I agreethat unless you have an objective way… And I think it will require leaders atthe state level to understand what the community of scientists they want tocreate is. But you also need, I think,something that Dr. Leonard mentioned, and that is that society has to recognizeor not just recognize but almost create an aura about the fact that science andtechnology is the future of the country.

12:40:16:12 They are thepioneers. And that has been lost. I mean, we had the space program, we hadtremendous shows… The media have to helpus too, by the way, in changing a little bit the perception from the-you know,the high rating shows and-to something that will feature scientists in adifferent light.

12:40:36:19 Judy Woodruff:That’s a very good suggestion. I hopesome people are listening.

12:40:39:12 John Leonard:I just want to amplify what I call the “emotional” aspect of this thing. I mean, you know, it’s not justeconomics. You know, that’s an importantpart for sure, you know, getting paid enough to go and live how you hope tolife. But it’s also what you dreamabout, what you aspire to do.

12:40:59:29 I don’t knowthe numbers precisely but I think for the Timein “Man of the Year” there have been something like two scientistsselected. It was one a decade ago andthen I think we had some spaceman in the ‘60s or something like that. And these are the people… Granted there’s a selection criteria and allthat, but if you go and you look for echoes of that, other things that we do inour society to put people up on a pedestal and recognize them for theiraccomplishments, for their contributions, there are few scientists.

12:41:36:26 EliasZerhouni: We have to make science cool to our kids. It has to be cool again. You know, not… I guess that’s the message…

12:41:43:23 John Leonard:That’s what I’m saying.

12:41:45:04 DeborahWince-Smith: Another thing I think we need to do is reverse the structure ofhow our research fellowships are awarded and managed, particularly from thegovernment. And actually to go to thefuture we need to go back to the past. And that is to restore portable research fellowships that the studenthas control of.

12:42:04:14 Again, it’sputting the power back into the user, the customer versus the producer. And right now, you know, our young studentswho become post-docs, who have fellowships under NSF or NIH grants, they, ineffect, work for the professors. Andthat didn’t use to be the case.

12:42:23:05 And we didsome very interesting research on this that a lot of very interestinginnovations that occurred some 20 years ago were the result of young people whohad ideas. And because they had theseportable fellowships, they weren’t beholden to what their professor said aboutdoing a certain type of research.

12:42:40:25 And how, youknow, that’s going to be implemented will be the challenge. Plus, also restoring the Department ofDefense’s historic role in graduate fellowships. It’s interesting to see people today in ourenterprise who are 50, 60 years old, you know, very leading universitypresidents.

12:42:58:29 A largemajority of them had portable fellowships from the Department of Defense whichcame out of Sputnik.

12:43:06:24 Wendy Chaite:I think we can learn from Research Australia and go full circle and createresearch heroes, because most of our children look to celebrities. Even ourselves. Our sports figures are really theheroes. And I think Research! America,in partnering with PARADE magazine,in their first issue talking about research heroes is really the message.

12:43:29:13 And we reallyneed to engage the media in this process because it’s about realigning ourpriorities and realigning what really is important.

12:43:42:07 Judy Woodruff:Thank you. Yes, right here. Please tell us your name.

12:43:45:04 Carol Kovac:Yes. I’m Carol Kovac from IBM. And I just wanted to first say that I wasvery gratified to hear so many of the panelists mention information technologyas one of the potential tools at least that can be used in this productivitydiscussion. We’ve actually been workingvery hard to convince IBM senior management that IBM really stands forinformation-based medicine.

12:44:06:14 So we thankyou for your help in that. My questionis not, actually, about IT. I’m veryfascinated by this whole question of productivity in health care and, Elias, Icouldn’t agree more that in order to afford the investments that we need tomake in innovation we’re going to have to address basic productivity.

12:44:25:10 You talkedabout sort of a labor-based model that needs to change but, you know, one of myobservations is that if you’re going to change a labor-based model, one is youneed tools. And we could talk about, youknow, we think IT is one of those tools. But two is the system doesn’t really reimburse or reward productivityfor, you know, using less labor and more efficient use of labor.

12:44:51:22 For example, Ithink only a few states today reimburse for e-mail consultations. Otherwise, you have to come in and beseen. Prevention is … and I know in ourown employee benefits we’re starting to emphasize prevention, but it’s stillvery, very rudimentary.

12:45:10:04 And we don’treimburse for quality of outcome. Infact, I think, you know, you get paid as much if the patient dies as if thepatient is well. In fact, you get paidmore if they get an infection and have to stay in the hospital longer. You get paid more. So, you know-so it seems to me that’s going torequire some really systemic change.

12:45:27:22 And in someways you guys have been talking about kind of a model going from, you know, acraft model of medicine to an industrial model of medicine. I guess one question that I have, since manyof the panelists are physicians, is do doctors really want to change medicinein that dramatic a way?

12:45:48:04 Then the otherquestion, and I would say particularly for Deborah and Elias, is, you know,what do you think about the whole question of driving these kinds of broad,systemic change that need to happen to change the productivity balance?

12:46:04:05 Judy Woodruff:Okay, let’s start with the first question. We made an exception for you. Yougot two questions. Do doctors reallywant to change medicine?

12:46:14:01 JulieGerberding: I’ll make a comment on that cause my first job at CDC was to directthe Division of Healthcare Quality so that was my area of expertise when Iarrived at the agency. And I would saythat having worked in a couple of different kinds of health care environments,doctors know the system is broken and doctors want better outcomes for theirpatients.

12:46:34:20 And they wanta better system. But I don’t thinkdoctors really understand the complexities of the system, per se. And one of thefundamental starting points of all that is to really just think about ahospital. Everybody in the hospital hasa different agenda and hardly anybody is focusing on the patient’s agenda.

12:46:51:19 Theadministrators are trying to save money; the quality people are measuringoutcomes; the infection people are reducing infection rates; the trainers aretrying to get the medical house staff to learn something and the educationcurriculum to be successful.

12:47:05:00 And we’re worriedabout throughput and the IT. But thewhole system is not really wired in the way to direct its focus on improvingthe health status of the patient who’s in the hospital. And until we get our act together and reallyalign ourselves in a way that leads in a direction that that is the overarchingpriority for the enterprise, I don’t think we can really get very far withthese kinds of incremental changes.

12:47:32:11 Judy Woodruff:What’s it going to take to do that?

12:47:33:15 JulieGerberding: Well, I think it’s going to take some experiments. You know, my fantasy in my next life would beto try to design a hospital that was wired that way, at least on paper, and seeif you could even make it look like an economic model that would work. But there are so many competing agendas.

12:47:49:04 And, you know,the process of getting from where we are now to where we need to be, I think,is going to require a major transformation. And I agree that it’s not IT alone, although IT could certainly be animportant tool in that process.

12:48:03:24 Judy Woodruff:Okay. Dr. Zerhouni.

12:48:05:01 EliasZerhouni: I’ll give you one example. Doctors do want to change, but they’re not in the position in the systemwhere all these transactional impediments are changeable at a doctor’slevel. I’ll give you one example in myown career. I was dean at Hopkins and Iwas chair of the Department of Radiology.

12:48:19:25 We developed avery fast scanner that could basically scan the entire body in less than 45seconds. And we said, “Well, we need tochange the paradigm of how we really examine our patients.” The patient would come, get a total body scanand have the image stored in a computer available to every physician in thehospital to have access at the time of a question.

12:48:44:24 So if thepatient has chest pain, you go and look at the chest. If he had abdominal symptoms or… You know what the impediment was? We couldn’t get reimbursed for a total scaneven at 1/5 the cost of ordering what Medicare said was necessary. You need to order a brain scan as a brainscan, a chest scan as a chest scan, an abdomen scan as an abdomen…

12:49:06:04 Judy Woodruff:Why couldn’t you get reimbursed?

12:49:07:16 EliasZerhouni: Because the system… Negotiatingthe waiver became such a nightmare that we just basically said, “You knowwhat? We’ll charge for one exam and dothe rest so we can do our research.”

12:49:18:00 Judy Woodruff:But who-but who was the obstacle, or what?

12:49:19:27 EliasZerhouni: The obstacle was the rules and regulations that do not allowexperimentation…

12:49:25:20 JulieGerberding: Layers and layers. Layersand layers.

12:49:27:07 EliasZerhouni: Layers and layers that have …

12:49:28:09 Judy Woodruff:These government rules or private industry?

12:49:30:28 EliasZerhouni: Oh, all rules.

12:49:32:10 Judy Woodruff:Insurance.

12:49:32:28 MS: Insurance,… You name it. And I think the solution is to allow ademonstration project. So give a waiverto people. Say, “Why don’t you show ushow it could best work”. Becauseinnovation occurs when one winner shows that, in fact, it’s possible. And then that gets adopted.

12:49:51:22 But physiciansreally are not at the top of the totem pole as they maybe used to be. And patients are not at the totem pole. They’re not making the decisions that is intheir best interest. If I had a choiceto go to a patient and say, “Would you like a total scan and then we’ll storethis and”…

12:50:09:14 And if thepatient had the control, they’d probably say, “Sure, Doctor. It’s a great thing.” Well, there were 60different steps that we outlined that would have been required for me, as not asimple doctor. I mean, I was notun-influential. I was a chair and deanand I couldn’t change it.

12:50:27:25 John Leonard:So we made you director.

12:50:28:19 Judy Woodruff:So much for…

12:50:29:20 EliasZerhouni: I gave up and became Director at NIH.

12:50:33:08 Judy Woodruff:Ms. Wince-Smith.

12:50:37:19 Deborah Wince-Smith:Well, this is a radical proposal maybe of how to start the demonstrationproject and who could have the most leverage, but I think that we ought tothink of how DOD could pilot it. Becauseit’s my understanding that the Department of Defense has the largest healthcare system in the world of the people in the military.

12:50:56:18 And I knowthat for instance back in the Bosnia conflict that some of the very earlytelemedicine, actual surgery being done remotely, was being done by the military. And, again, I’m not knowledgeable about allthe rules but I think they do have some authority to escape some of thisbureaucratic being tied down like Gulliver.

12:51:19:24 And giventheir power, the number of people, the need, they could be a really, reallypowerful first mover for this just the way they were in lots of otherinnovations.

12:51:29:17 Everythingfrom the Internet to (inaud.)…

12:51:30:02 JulieGerbreding: The VA system also is a great innovator. In fact, they have come up with some verywonderful solutions. So it’s sort ofthat military model.

12:51:40:07 Judy Woodruff:We have somebody, a man who’s been standing there very patiently for about 20minutes, but I’m told that we need to wrap up. Is that right? We… So don’t be angry with me. You can take it out on Mary Woolley and PaulRogers.

12:51:57:18 EliasZerhouni: One more.

12:51:58:12 Judy Woodruff:All right. They say you get a waiver,sir. Go ahead.

12:52:02:18 SamSilverstein: My name is SamSilverstein. I’m a member of the boardof Research! America.

12:52:08:07 Judy Woodruff:Well, in that case…

12:52:09:13 SamSilverstein: Dr. Zerhouni did not put me up to this. I’m a physician/scientist at ColumbiaUniversity. But I think someone hereought to say that it is rare privilege that we scientists are afforded in thiscountry to have the opportunity to do what we love to do, to do it … for thebenefit of mankind and to compete, yes, in a difficult environment perhaps.

12:52:45:28 But I’vethought to myself many times, “What would Michael Angelo have said or Heiden(ph.) have said if you said, ‘Joseph, why don’t you stop working for CountEsterhaus (ph.) and go get a grant from the National Endowment for theHumanities'”? He would have said, “Well,that’s pretty spectacular.”

12:53:11:10 “I’m a freeperson. I can do it at my pace in theway I think best, and I can use my God-given talent.” This is a remarkable system we’ve created. And there are-there’s no system that’sperfect. But I’d like to say that Dr.Zerhouni is doing his best to make this system of research better.

12:53:39:29 I applaud whathe’s doing. And I wonder, Ms. Woodruff ,if you would just give him a moment and, Paul, if you’d just give him a momentto tell what he’s doing to create a system of general clinical research centerswhere you’re trying to coordinate, as I understand it, the general clinicalresearch centers throughout the United States as a model for how clinicalinvestigation systems can be created in this country.

12:54:09:23 Judy Woodruff:Of course.

12:54:10:00 EliasZerhouni: I’m going to respect what Judy said. Last question, last comment. I’mnot commenting on this topic but I think, Sam, you said something that is veryimportant, and that is… You know, I’m animmigrant to this country and I have to say that were it not for the abilityto, in fact, support research the way we do with the peer review mechanisms andnot the top down, come in and control type of research that has been done inother countries, I don’t think we would be where we are today.

12:54:38:00 And I wouldapplaud what you said and the GCRC’s for another time.

12:54:42:11 Judy Woodruff:So our thanks very much to the panel, Dr. Zerhouni, Dr. Gerberding, Dr.Feczko), Ms. Wince-Smith, Dr. Leonard and Ms. Chaite. Thank you all very much. Thank you. [CLAPPING]

12:55:10:25 Paul Rogers:Let me, on behalf of the board of Research! America, thank this wonderfulpanel, competent, great panel and our totally effective moderator, Judy Woodruff,for this wonderful forum. Would you joinme in thanking them? [CLAPPING] … I’m going to say a word or two. Cause we’re running late I’m not going to saytoo much, though, Doctor.

12:55:57:25 I do want tosuggest that everybody will really enjoy lunch, which we will provide for yououtside here, because we have the commissioner of the Food and DrugAdministration who will speak to us. Hehas agreed to come and be with us. Dr.Lester Crawford. So you will reallyenjoy his speech because he’s going to have some interesting comments, I’msure.

12:56:26:08 Now let mejust say this. I think this panel haspointed out for us today many things that obviously we need to work on. But one message, I think, comes through to meis that we all need to kind of unify our message of support for research. For research. And we need to let them hear it on the Hill, over in the White House,everywhere.

12:57:06:17 In your Stategovernments. And, Governor, you weregreat to be in. I think your program’s terrific. But we need to get it out in the states andcommunity to build support. And anotherthing that Research!America feels, and I know you scientists feel this, that weneed to get the scientists out talking more where the public doesn’t feelthey’re in the ivory tower.

12:57:32:18 That they’rewilling to discuss their work and what they’re trying to do for thepublic. That’s a good way to getsupport. And we certainly want toencourage that. But I think if we cancome together, get this unified message-Without research there is no hope, nohope to find the cures for disease.

12:58:13:29 We thank thispanel. Please join us for lunch. [CLAPPING]

13:26:50:24 Paul Rogers: Wewould expect you to continue eating. Our speaker has said he didn’t mindspeaking over that. But that we are very honored to have as our speaker today,the Commissioner of the Food and Drug Administration, Dr. Lester Crawford. Hewas appointed, you know, acting commissioner back in ’04.

13:27:22:00 He’d been deputy directorbefore that. In fact, his life has really been made up in its activities ofprotecting all of us for a long, long time. He’s been concerned about thesafety of the American public. And we’re very fortunate to have him as thecommissioner now.

13:27:49:11 Let me just remind you ofa few things he has done. [He] started out down there at the University ofGeorgia, a wonderful university, as chair of the Department of Physiology andPharmacology. He was administrator of the Food Safety and Inspection Service ofthe United States Department of Agriculture.

13:28:19:02 And from ’97 to ’02, hewas director of the Center for Food and Nutrition Policy at GeorgetownUniversity and that was moved in ’01 and he went down with that, took thatwhole program down to Virginia Tech. Dr. Crawford has played major roles inmandatory nutrition laboring and how important that has become to the public.

13:28:55:19 The formation of the WorldTrade Organization, he was most helpful there. And the control of chemical andmicrobiological contamination of food. He has been really an adviser to theWorld Health Organization of the United Nations most of his career, it seems.

13:29:20:17 He’s been involved formany, many years. He is a member of the Institute of Medicine of the NationalAcademy. He is a fellow of the Royal Society of Medicine, the UK. And he is afellow of the International Society of Food, Science and Technology.

13:29:47:01 We are fortunate to havesomeone with that background take over command of the Food and DrugAdministration at a time when they need strong leadership. I’m honored topresent to you, our speaker, Dr. Lester Crawford.

13:30:13:23 Lester Crawford: Thankyou, very much, Paul. That was a most gracious and generous introduction. Iappreciate it very much and I thank Mary Woolley and everyone for inviting metoday. And I also thank Providence for not being here today. I got off to amost … this is a most confusing week.

13:30:33:14 I got off to a mostconfusing start this morning. When I got [in] the car and the driver startedoff in the wrong direction. And I said, well, why are we going this way becausewe have to be out at Park Lawn, the famous FDABuilding named for cemetery in Rockville.

13:30:59:13 Some of you didn’t knowthat, obviously, but, from my window on the 14th floor, you can look out andsee miles and miles of headstones. Reminds me of why I’m there. But he said”Well, I have your schedule, I know where you’re going. Best thing for youto do is just sit back and relax.”

13:31:19:06 Then I said, “But,we’re going to miss the several nice speeches and meetings with the Congressmanand all that sort of thing.” But he had me convinced until he said,”You know, Wednesdays are really tough days, aren’t they?” And I said,”Well, actually, Roger, this is Tuesday.”

13:31:37:26 So we turned around andgot here and I’m grateful for that. But there’ll be three or four other thingslike that as the day goes on. I am especially grateful to be here at AAAS whereI served on the committee on Scientific Freedom and Responsibility for a numberof years and got to meet several of you that are here.

13:32:00:15 I also have done someclose work and collaboration with Mary Woolley over the years and am alwayshonored to be in the same room where she is and that noble institution that sheheads up. Today I want to talk to you about three things we’re doing at FDA interms of research and paving the way for some future research and some changesthat we’re making to make the agency more responsive to the 21st century interms of location and our laboratories and these kinds of things.

13:32:36:25 And I would start with theCritical Path. We decided some three years ago that among the things that weweren’t getting good cooperation from the private sector and the public sector,other areas of government owned, was the science of drug development and thescience of the development of all the five product categories that FDAregulates.

13:33:10:03 This has changed over theyears to where it seems to be more an art than a science at this particularpoint. And we think some of the problems in the industry, some of the problemsin regulating, some of the difficulties in therapy are probably a result ofthat.

13:33:32:04 … So we did this thinkgroup, the spiritual leader and intellectual leader of that was someone many ofyou know, Dr. Janet Woodcock. She continues to head up the effort. We concludedearly on that only FDA has access to all the data required to put together ananalysis of the science and the techniques associated with drug development,device development, vaccine development, veterinary drug development, foodadditive development and nutrition development.

13:34:11:09 Because much of theinformation is proprietary, much of it is so historical that it doesn’t existsoutside of FDA. And a large amount of it has never been published in any shape,form or fashion. So we decided to undertake the initiative and we went forward.

13:34:31:23 We had a number of namesfor the effort, Critical Path was the working title early on and then we had avote of our so-called executive committee of FDA, which unfortunately consistedof 12 people and the vote came down 6-6. And so the working title remains.

13:34:58:04 It’s kind of an ugly titlebut the idea is, is it’s a critical path from the laboratory to the bedside.What does it take in order to get a drug evaluated properly and what are theconfidence levels that we can develop with patient testing, with animaltesting, with all the other bits and pieces and fits and starts as we goforward.

13:35:26:05 Out of that initiative in2002 came something that we thought we could do in the short term that mightserve as a beacon for the long term analysis of the Critical Path. And some ofyou remember in early 2002 on up to the mid-2002, FDA had to levy a recordnumber and a record size of a number of fines for pharmaceutical companies andother companies for violations of good manufacturing practices.

13:36:01:27 Now as all of you know, wedo three things at FDA in most product categories. We determine whether theproduct is safe, whether it’s effective and finally, whether or not it can bemass-produced in a consistent and safe fashion. The mass production part isgenerally called around the world, good manufacturing practices.

13:36:25:06 And FDA has always been sointent on linking good manufacturing practices to drug safety and to patientwell-being that we actually inspect every plant anywhere in the world thatproduces products for the U.S. market. And that has been done on somewhat anintermittent basis for many of the products and a somewhat lengthy basis withsome of the other products we deal with because of the costs and the resourcesrequired to do that particular initiative.

13:37:00:15 But we have now changedthat to some extent. For with vaccines, we were doing these every two years.We’re now doing them every one year and then if there are problems of course,we go into sort of a continuous inspection process or we ban them from the U.S.market.

13:37:20:00 So the fines and also thereach and grasp of what we had to do indicated to us that GMPs were out ofdate, particularly for drugs. They were put together 25 years ago when some ofthe quality control and safety control concepts did not exist and they werecertainly put together for machinery that no longer exist in the marketplace.

13:37:48:20 So it is a massiveundertaking. I gave the task force two years to come up with a proposed new setof GMPs for drugs and two years to come up with a proposed new set of GMPs forfoods. The ones for medical devices were already being developed through aninternational organization.

13:38:12:07 We met that two yeardeadline and we believe that on the third anniversary of the charge, weprobably will be finalizing the GMPs in a final regulation. The ones on foodsare still a little bit behind but we will get that done also.

13:38:34:18 And this, we have nowpresented our findings to 80 countries, either here in Washington or around the world. As most ofyou know, the European Medicines Evaluation Agency is marching lock step withus as are some international organizations.

13:38:54:11 So this will revolutionizethe way drugs are manufactured and also how they are produced. And it is thesingle most important undertaking of its type to reform a drug production inFDA’s history. Those of you that read the Federal Register notice would havebeen shocked.

13:39:16:06 Most people were soshocked by the figure that they got it wrong, including many of our dearestcolleagues in the press. But the estimate is, is that we will, this initiativewill save the American people alone, $50 billion over a 10-year period and wethink it will materially affect the cost of drugs in the right direction and wecertainly think it will affect drug development.

13:39:45:15 And nothing we have doneso far is going to be as important as that. We think Critical Path will subsumeit and will be far more important over time and the savings there are going tobe even greater. So you never have very much fun unless you tackle somethingvery big.

13:40:02:12 Of course, you never failunless you tackle something very big too. But we’re after it and I think thingsare working out very well. Now, Critical Path is going to be more long-termthan two years but it will have discrete pay-offs. Some of the tool kit thatwe’re looking for to develop drugs and vaccines and food additives, we willissue either interim white papers or proposed regulations all along now overthe next few years.

13:40:35:26 And eventually, CriticalPath will be FDA’s means of reinventing itself in order to keep up with what isgoing on. So that is something that you want to watch very carefully. Now, it’sgoing to take funding. It’s going to take an enormous amount of that.

13:40:50:12 It’s also, though, moreimportantly, going to take cooperation. We’re interacting with threeuniversities and medical centers in universities now in terms of trying toconvince them to consider a center for our Critical Path research.

13:41:13:03 And we’re thinking massivecenters and our powers of persuasion are really great. We have no money for itbut we do have, we promise, eternal blessings for whatever religion you’re in.And if you’re not in a religion, we’ll try to fix that also.

13:41:30:14 But we believe that thatfunding will come over time. But the cooperation part from within thegovernment also is off to a good start. Help within the medical community,scientific community in general is palpable and reinforces us everyday.

13:41:52:04 The National CancerInstitute and we have signed a partnership along two lines. One is we signed amemorandum of understanding so we can share information between each other backand forth, without fear or loss of confidentiality or compromise of commercialinformation.

13:42:15:05 And then we just signedanother MOU with the National Cancer Institute and its distinguished director,Andy von Eschenbach, about 10 days ago where we will train a generation ofmedical and other researchers in Critical Path research.

13:42:33:16 And we’re starting offwith an impressive 25 individuals that will be fully funded toward graduatework and also resident research at NIH and at the FDA. The first 12 of thesehave already been selected and have started doing their work first at FDA.

13:42:57:20 And these will be, wethink, the legion of individuals we need over time to make a science out of thedrug development process. We are not excluding anyone, including the industry,including the people from other countries and centers from other countries andcertainly our counterpart organizations around the globe.

13:43:17:29 But the key factor is theNCI partnership. Now you say why did you do NCI? Why didn’t you do some othercenter? We’re coming and we’re working out these same kinds of agreements withother centers at NIH and we also have been working very carefully with theCenters for Disease Control.

13:43:36:04 I have to pause here andsay that as some of you know, I’ve been at FDA off and on for 30 years. And Ican remember different administrations. I’ve served in some way or another inevery administration since the Ford administration, including, I first came toFDA on a full-time basis in the Carter administration.

13:44:01:02 And I can remember timesin FDA’s history when we didn’t have diplomatic relationships with either CDCor NIH. And didn’t even have phone call return possibility. But it’s workingnow and we have to give a lot of credit to the current secretary, MichaelLeavitt, and the previous one, Tommy Thompson, who just would (inaud.) know orunderstanding of the fact that the optives, as they are called in HHS couldn’tcooperate with each other.

13:44:30:17 So that part is going welland we’re delighted with that. And Drs. Gerberding and Zerhouni are among thefinest colleagues I’ve ever had the privilege to work with. We all have a moreor less full plate, but they’re taking the time and doing the things that needto be done.

13:44:50:20 And even on a day liketoday when the news of anthrax has surfaced its head again, you find that Dr.Gerberding is kind enough to be here and I’m also coming by but the point isthat we feel an obligation to do this kind of thing and interact with you.

13:45:11:24 And we also feel a great obligationto cooperate with each other. So that part is working. And so FDA will never bea basic research entity. It will never have $29 billion in research funds. Wedon’t even have $1 billion in research funds but we know somebody that does andwe’re after them.

13:45:36:02 And now the other thing,the third and final thing and I would talk to you about is something that thegeneral public misses and even I forget about, from time to time, but if youreally wanted to destroy an organization, what you would do is you would, well,first of all, you would locate it in Washington, D.C.

13:46:00:25 And then the second thingyou would do is you would put it in 55 different locations from North Baltimoreto Chantilly, Virginia, so that some of your meetings would involve peoplehaving to drug a roundtrip of 150 miles to get there.

13:46:20:09 That would be how youwould destroy an organization and that is the story of the FDA. We’re all overeverywhere. But there is help coming. Many of you know about the White Oakfacility, which is on the Beltway, just north of here about 13 to 15 miles,[which] was formerly a naval research facility.

13:46:46:21 The main core building,which looks a lot like a replica of Columbia University’s facade, weare maintaining. We have gotten tremendous cooperation from the Congress,particularly, the Maryland delegation, but also the people from the HealthEducation Labor and Pensions Committee in the Senate and elsewhere.

13:47:10:13 And this is Phoenix Risingout of the ashes. You can see five buildings at White Oak now that are instages of completion. And the first one has been moved into now for two years.When I came on board in 2002, no building was being built.

13:47:30:09 We did have the facilityand with it came a golf course that we were expected to maintain. The answer tothat is we will not be. We’re going to have a hog farm nard. But it is a greatfacility and let me just tell you about the sequence of buildings.

13:47:51:22 Now everybody from FDA,except the field force and Center for Food Safety and Applied Nutrition, willbe located there, started two years ago, all the way up to 2010. And in 2010,it’ll probably be more like 2009, there will be about 8,000 FDA-ers at WhiteOak.

13:48:12:20 There’ll be about another1,500 at the Wiley Building, which is on the University of Marylandcampus. We just moved into it three years ago. That’s the Center for Foods. Andthere will be some research facilities between both of those but they’ll beeasily, almost walkable, in some cases.

13:48:35:18 And the first buildingthat’s been occupied typically is the Life Sciences Laboratory and that is usedby both the Center for Drugs and the Center for Devices. The next one will bethe Center for Drugs office building. So the Center for Drugs will be movingalmost 2,000 people in this year.

13:48:55:17 And so then that willalmost immediately become sort of the central headquarters of the Food and DrugAdministration. The hapless commissioner-designate will still be at the ParkLawn Building named for the cemetery but everybody that works for him is goingto be out there. It makes a lot of sense to me.

13:49:13:23 But then finally, in 2006,the Center Shared Use Facility will be occupied and then one that we justdedicated with a lot of help again from the delegations from Maryland, theEngineering Physics Lab will be completed and occupied in 2007.

13:49:31:24 More drug offices, moredevice offices in ’07 and ’08, Center Shared Use Facility, Center for BiologicsLaboratories, all of you are familiar or most of you are familiar with thegreat Center for Biologics Labs on the NIH campus, they will be greatlyimproved and moved to White Oak.

13:49:54:07 And the Center forVeterinary Medicine Offices will move in 2009 and finally the commissioner andthe headquarters of the field force will be there. We now have 10,000employees. We expect by 2010, there’ll be between 12,000 and 15,000, and ourbudget will probably be half what it is today but we’re going to have a lot ofpeople, volunteers.

13:50:20:09 And so then finally Ithink we will have, I’m sure, I haven’t visited all of FDA counterpartorganizations around the world but I’ve visited half of those that are membersof the United Nations and no one anywhere will have anything that will rivalWhite Oak.

13:50:42:09 And no one anywhere willhave one that will have research facilities right integrated into the officeand regulatory affairs functions of the agency. This will be something thatwill finally be fit and make proud the American people.

13:51:00:18 Our reputation at FDA hasbeen great. We usually get nosed out in polls by the Park Service, which gallsme no end. But this year, we came within one point. We increased 12 points inour popularity contest, which we pay for so we should increase.

13:51:22:16 But Park Service lost acouple of points so we’re gaining on them. But in any case, our reputation isone thing but the ability to do the work in this congested area in 55 differentlocations is just not on. And we have no situation where FDA-ers of like-mindfrom different centers can be walking down the hallway and interchangescientific information or football scores or whatever with each other.

13:51:50:07 We will have that at WhiteOak and we are going to start as soon as the [inaud.] Office Building is openin spring of this year, having regular tours. And we invite all of you to bethere because it’s going to be something that you simply will not believe.

13:52:07:17 It will costs by the endof the time about a billion dollars. We have about half that in hand now. So wedo depend on more funding and we also depend on the kindness of not strangersbut Congress people. So let me just conclude here now with some final comments.

13:52:30:20 FDA is about science. It’salso about risk assessment. Again, when I came back in 2002, I found that themodern science of risks assessment and analysis of options for regulatory kindsof developments was working very well and the centers of FDA, like the Centerfor Drugs, the Center for Foods and so forth, was not working well in thefield.

13:52:56:20 So we went through a threeyear training program for the field force of FDA, which is about, in goodyears, is about half the total personnel. And with the Bioterrorism Act of2002, which we were able to get passed and the President signed in June of thatyear, we did finally have enough funding for some training and we have nowcompleted that and we think our field force, which has been enhanced greatlybecause of the Bioterrorism Act and the training funds that we got as a resultof that, we think it’s a very new kind of field for us.

13:53:33:27 And we think no longerwill they be guilty of ridged counting where they basically just count up howmany items they inspect rather than going after those items that are mostrisky. Some things we inspect at the border and domestically have almost norisk whatsoever.

13:53:52:27 Whereas some are made tobe deadly. And so transforming the field in that way also has been a major accomplishmentthan I had very little to do with but it is nonetheless already payingdividends as we move forward. And just to say another pan to the BioterrorismAct.

13:54:13:23 It was a brilliant pieceof legislation that gave us the authority and the means for the first time toregulate the food supply. I remember coming on board in February of 2002 andbeing told that a shipment of fish from a Middle Eastern country was headingour way and that it was contaminated.

13:54:33:25 And I said, “Well,how can we be having fish coming from Yeomen?” And they said, “Well,wait ’til we show you the latest shipments from Afghanistan.” So we didn’tand we had no authority to prevent that from happening. That is to blacklistcountries or people or whatever. Now we do.

13:54:54:09 And so we have a, I think,a seamless system that works closely with USDA in getting that job done andit’s a model for what we do elsewhere in FDA. So at this point, I want to thankyou once again for all your time and I will see you tonight and hope you have agreat afternoon. Thank you.

13:55:21:08 Paul Rogers: Thank youvery much Dr. Crawford for your remarks and for already improving the FDA.Congratulations to you and we’ll be anxious, Research!America, towork with you, to maybe bring the needs for funding to the attention of somepeople that might be interested.

13:55:46:21 So we wish you the best.We look forward to having close relationships with you. Thank you for beinghere. And now, I think, please finish your lunch if you haven’t and there arecookies and desserts and we will begin a board meeting at five minutes in thisroom.

13:56:22:02 Thank you all for beinghere.