viding better health for our citizens are impressive. It should be national policy to support the vitality, and thus the dynamic social usefulness, of this great industrial research resource, just as it should be national policy to keep strong every other weapons system we have developed for waging the war against disease.

The most useful way to describe this industrial capability for the committee is to tell you a little about the portion of it with which I am most familiar. The staff of Merck's research laboratories consists of nearly 1,700 men and women, approximately half of whom have scientific degrees. Many of them are ranked among the leaders in their disciplines by their peers throughout the world. These people are attracted to Merck by the quality of the work that has been done in our laboratories over the years, by the competence of their associates, by the opportunity to concentrate on areas of investigation that interest them, by the excitement of working together with scientists of other disciplines toward common objectives, by their freedom to publish, and by the great reward that comes from participating in the creation of substances that will lighten the human burden of illness. The only way to judge the competence and social values of this group at the Merck Sharp & Dohme Research Laboratories is by its contributions to medicine. These include-to mention just a few of them several of the vitamins, among them the discovery of vitamin B-12; the first production in this country of penicillin; the development of streptomycin; the initial synthesis of cortisone, and the discovery of chlorothiazide. More recently, our laboratories have discovered or developed important drugs widely used in the treatment of heart disease, high blood pressure, mental depression, infection, and arthritis and other inflammatory diseases. I shall not burden these hearings with either a description of our research or an enumeration of our accomplishments. Since such information is relevant to your inquiry, however, I would like to submit as a matter of interest to the committee and its staff two of our publications which highlight this research endeavor.

I will acknowledge that we are proud of this record. I will also acknowledge that we are proud of the fact that our industry has made its own investments in its research and has not had to call on the taxpayers for any meaningful financial support for its technological capacity or for its productivity in terms of new drugs.

This obviously does not mean that we feel we can carry out all our future obligations to society without any outside help. I have already mentioned the interdependence of all science and the need to continue the close working relationships that our scientists have long enjoyed with their peers in government and the universities. But there are also some limitations on what a single company or indeed an entire industry can carry by itself, since its resources are not infinite and we must stay within the realm of the practicable in order to perform our role efficiently.

Though we devote substantial resources to and have made significant contributions to basic research, the needs in basic research in the health sciences are so enormous that they almost infinitely transcend the potential for support from all private sources. That is why I so strongly support the Government's role in basic research and in developing the Nation's capacity for such research.

The challenge facing the Nation is to optimize the capacity of all our resources-to achieve the greatest efficiency of each segment of our scientific community.

Perhaps I can best elaborate my position on the efficient roles for Government and industry by giving you an example. I will choose the example of arthritis because it is the No. 1 crippler and is second only to heart disease as a cause of disability. Thirteen million persons are painfully aware of the disease. Of these, more than 3 million have some limitation on their activity, and 700,000 of these are unable to work, keep house, go to school, or engage in recreational activities. Merck has devoted some of its best scientific efforts over the past 30 years to research on arthritis-research that is both basic and developmental. It was a young Merck chemist, Dr. Lewis H. Sarett, who, at the age of 26, first synthesized cortisone after some of the best steroid chemists in the world had tried and failed. This was in 1948, and it was the first major breakthrough for arthritis patients. Cortisone was followed by improvement after improvement by scientists in several companies in the industry, including ours.

Then, after a 10-year effort, we made another giant stride in our laboratories when we introduced indomethacin, a nonsteroid product which has been a boon to several million patients throughout the world.

But there is still a deep dissatisfaction connected with this story. It is a dissatisfaction for us, for other scientists, in the pharmaceutical industry, and, most important, for the medical profession and for the 'millions of victims of rheumatoid arthritis and related diseases. Neither we nor anybody else has found either the cure for, or, for that matter, the cause or causes of these diseases. All we have discovered are methods to relieve suffering and to return invalids to productive lives. This is important. But we are challenged to finish the job. Unfortunately, we cannot do so until we have a lot more fundamental knowledge. Parenthetically, I should like to add that this is far more generally true than is often recognized. In only a few diseases, such as those associated with bacterial infections and vitamin deficiencies, can we cure. In most diseases, we can only provide supportive therapy or alleviate the symptoms.

The concept that most diseases, like rheumatoid arthritis, are not yet curable by drug therapy points up the primary target for the future. And this is where the current Federal programs are most vital to the health of our people, and where the government can perform its optimal role. Private industry can finance some-but only a fraction-of the broad program of basic research that will be needed for an indefinite number of years before we shall know enough to be able to finish our job. If our industry tried to do it all, our remaining resources would soon be unequal to the task for which we have demonstrated an unsual capacity: the very important interim task of finding ever better relief for the pain and disability of millions of patients with chronic and degenerative diseases.

As the cause of each of these diseases is being probed in laboratories throughout the Nation, there is one thing of which we can all be certain: the industry will be ready, as it has been in the past, to perform the intricate task of transforming this new knowledge into safe and effective therapeutic agents-no matter how difficult to snythesize and

manufacture and make them available to the medical profession around the world. Once we have reached the feasibility stage, there can be little question about the outcome, so far as the potential of the pharmaceutical industry is concerned.

But if, at the time the cause of any important disease is discovered, it should become clear that private industry lacks the capacity or incentive to develop a cure, it would become essential for other resources to be introduced into the equation. Then I should urge the Federal Government to step in and help with great vigor and determination. The fundamental requirement for any developmental research program, however, whether sponsored by industry or Government, is the need to establish fesaibility-that is, to establish that knowledge has progressed to a stage where there is scientifically convincing evidence that the potential for important results exists. This is a most difficult judgment to make, as I well know. I have to make such judgments all the time, and I am, by virtue of my position, held accountable to the president of the company and to our stockholders for the rightness of my judgments or at least, the proportion of times that I am right.

Although I have spoken about the importance of finding the cause or causes of a disease through basic research, even this knowledge does not necessarily mean that a developmental research program becomes feasible. There is a disease called "sickle-cell" anemia, for example, which might be called the best understood disease in the world. It is a genetic abnormality in which one specific amino acid in the 146member chain of hemoglobin is modified. It is understood on a molecular level, but we don't know how to begin to approach therapy. The same thing is true of other genetic abnormalities, such as those reflected in phenylketonuria, Wilson's disease, and galactosemia. It has recently been learned that there is an extra piece of genetic material in the chromosomes of mongoloids. I can assure you that many biomedical scientists I know would be working on elimination of this disease if they could conceive of any experiment to do in the laboratory or in the clinic on the basis of this lead. So, feasibility is very difficult to establish *** but a responsible judgment as to feasibility must be made before developmental research can properly be considered.

When government involvement in developmental research in biomedicine is being considered, it seems to me that certain special criteria need to be met. Either it should be of a kind or magnitude that puts it beyond the capacity of industry and its associates in universities and other nongovernmental institutions. Or it should be demonstrable that current and future private effort will be inadequate in speed and comprehensiveness, as measured against the public interest.

The application of these criteria is essential if we are not to put at undue risk the taxpayers' contributions and the Government's resources by investing them in premature, wasteful, and uncertain projects-and, at the same time, weaken the Government's future participation in biomedical research in its totality.

It is readily apparent, Mr. Chairman, that such criteria demand the availability of a mechanism that as far as I know does not exista means by which government can be sure that it knows what research is being done in a given field, what its promise is, and what its prospects are for continued or expanded support. I am not quite sure what this mechanism should be. But it should provide government with a consensus of experts representing all research fields related to biomedicine

and all private and public research resources, permitting government to set national objectives in which we can all participate. I believe we owe such a mechanism to those charged with the responsibility of providing direction and focus for Government research programs.

My point of view-my objective-in taking this position must be quite obvious. I believe, if we are to advance in biomedical research at an optimal pace, there must be ever-closer understanding and collaboration among Government, universities, and industry-achieved at the same time as steps are taken to preserve the fundamental and separate characteristics of each that are so vital to the total national effort.

Thus I do not believe it is desirable, necessary, or in the public interest for government, except under special circumstances, to assert responsibility for developmental research in biomedicine now performed capably by industry. To do this would be worse than merely duplicative. It would be destructive of a resource of proven productivity-the laboratories of the pharmaceutical industry. In the face of governmental preemption of the most promising fields of developmental research, supported by large appropriations and the special advantages enjoyed by Government agencies, the industry laboratories could not long maintain the unequal struggle. And with them would pass a diversity of approach whose values could hardly be replaced in any centrally directed system, as well as the incentives for achievement that have rewarded now one company and now another in a competition in which the patient is the ultimate winner.

I do not believe, similarly, that the Government should impose a developmental research burden on academic institutions and so create a force for change in the basic character of the university. And I do not believe that, in biomedicine, government should create a network of semiprivate contract research institutes to effectuate programs which can better be carried out by existing industrial laboratories.

I do believe, however, that the task before us is so enormous and of such consequence to all people today and to those of future generations that it is essential for all of the resources now at our command to be fully and effectively utilized.

I know it is clear to you, Mr. Chairman, that I make these comments and suggestions on the future of biomedical research not because of any commitment to perpetuation of the status quo. As a scientist, I am by nature and training always seeking ways by which we can advance through change in the status quo.

I also do not make any distinctions between public and private roles on the basis of my belief in property rights, at least in the static sense. After all, it is my business to destroy my company's property rights in an old drug by finding a much better one. I do, however, believe in dynamic property rights: Those that force us, because of competition with other laboratories and because of the rewards if we win (or the penalties if we lose), to work hard and to work efficiently to improve the health of the American people.

This is the real goal of all of us, in and out of Government: the conquest of disease. Congress and the various administrations in the past decade have brought us immeasurably nearer that goal through consistent, wise, and foresighted support of research in the life sciences. The road ahead still disappears over the horizon. And the longer it takes to reach encouraging way points, the greater will be

the perseverance required to continue along it. The temptation to succumb at times to expediency and faintheartedness would be understandable. But at the end of that long road, I believe, there lies the reward that all of us seek. And it will come from that most objective of all judges-from history itself.

Thank you, Mr. Chairman.

Senator HARRIS. Thank you, Dr. Tishler, for your presentation. You have made several very useful suggestions for the proper roles, as you see them, of the Federal Government and private industry in the field of biomedicine and the importance of Government-financed research, especially toward understanding the causes of disease, particularly chronic and degenerative diseases.

You said that "such criteria demand the availability of the mechanism that as far as I know does not exist."

Later you said, "I am not quite sure what this mechanism should

'be."

I wondered if you care to elaborate on that. "Mechanism" is the word that interests me.

Dr. TISHLER. I do believe that a mechanism is essential, and I have felt that way for many years. I believe that the National Institutes of Health should have a very primary role in establishing that particular mechanism; all of us have confidence in these institutions.

I think our only problem as far as industry is concerned, and I believe you are directing your question largely at industry, because it would be no task at all for the NIH and other organizations to meet with the universities, I think the only question that would concern us is what we could say or reveal as to the status of our programs should the information fall into the hands of our competitors.

We have confidence in institutions such as the National Institutes of Health; in fact, we have given them information in the past on surveys made on a confidential basis. I think there are elements of a mechanism which has been used in the past and could be used more effectively in the future.

Senator HARRIS. Were you here this morning during the testimony of Dr. Lederberg?

Dr. TISHLER. Yes; all day.

Senator HARRIS. I want to read from his statement. You may not care to comment on it, but I will read it. If you do, I would be pleased to hear any comment you have.

There are several subjects encompassed in that paragraph, which states:

Analogous approaches are worth considering to encourage the most creative deployment of the resources of the drug industry. In view of the restraints on profiteering on drugs, secondary incentives for risking capital in research are essential. The operations of FDA ought to be financed by a manufacturer's excise tax on drugs amounting to, say, 25 percent of their wholesale value, or about 10 percent of the consumer price. However, the company's research and testing force (its investment in innovation) should be credited against that tax. Furthermore, companies that contribute matching funds to university research should be franchised to be able to participate fairly in patents in which the government now would retain a preclusive interest, and even worse, a vaguely defined bureaucratic involvement. The lack of clear definitions of the scope of government interest in patents that bear any relationship whatsoever to federal health research support is an intolerable bar to industrial-academic cooperation. Perhaps we might bar patents altogether for the more fundamental aspects of drug innovations, and leave them only of the later, costlier