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In 2001, twenty-one-year-old Abigail Burroughs was dying of cancer. After all conventional treatment methods failed to improve her condition, Abigail’s oncologist pleaded with the Food and Drug Administration to allow her to try Erbitux. At the time, Erbitux had not fully passed the FDA’s drug approval process. Abigail was denied access and lost her battle to cancer shortly after. The FDA eventually approved Erbitux in 2004 to treat the same cancer which cost Abigail her life.

Heartbreaking stories like Abigail’s (and thousands of others) provoked a country-wide movement to allow terminally ill patients the right to try experimental treatments to prolong their lives. This movement became the impetus for right-to-try legislation. Right-to-try legislation grants patients with terminal illnesses access to potentially lifesaving drugs before the FDA fully approves them. By side-stepping the FDA’s formal approval process, decisions to try unproven, although potentially beneficial, treatments are left to patients, physicians, and drug producers.

[This piece was co-authored by Vincent Geloso and originally published at the American Institute for Economic Research.]

Ramming an icepick through someone’s eyelid to remove a part of their brain sounds like a horrifying method of torture. However, this procedure, named the lobotomy, was a common method to treat mental illness in the United States for nearly 40 years. From 1936 until 1972, nearly 60,000 people were lobotomized. Most lobotomies were performed without the patient’s or their legal caretaker’s consent.

Unsurprisingly, the procedure was a spectacular failure. After surgery, patients often found themselves paranoid, emotionally volatile, incontinent, and with severely impaired intelligence. Surgical complications often left patients unable to function independently, requiring constant supervision and caretaking. When a patient was released from the asylum after being lobotomized, they typically found themselves returning within a few months. Upon their return, they often underwent a second (or, in one case, fourth) lobotomy.

The lobotomy has been described as “one of the most spectacular failures in the history of medicine.” But unlike many historic medical practices which seem barbaric and detrimental only in hindsight, the lobotomy was scorned and dismissed by medical professionals when it became most popular. By 1941, the American Medical Association denounced the lobotomy as ineffective. Shortly after, a world-wide consensus developed along the same lines. However, the procedure continued to grow in popularity, eventually reaching a “lobotomy boom” in the mid-1940s and early-1950s.

But why did the lobotomy become popular, and why was it used for so long after the medical community came out against it? In our paper forthcoming at Research Policy we argue the answer comes down to incentives.

In the early 1900s, a large public health movement led by politically-connected physicians called on the federal government to increase funding for public mental asylums. The movement was successful. Through the 1940s, public asylums and psychiatric hospitals gained additional federal funding based on the number of committed patients they housed. At the state level, physicians lobbied for less stringent commitment laws, reducing the legal requirements to have citizens involuntarily committed to asylums. Accordingly, commitment rates skyrocketed and those managing asylums, often called superintendents, received considerably more funding.

However, the staff-to-patient ratios within asylums did not keep up. By 1949, the National Bureau of Mental Hygiene estimated there was one asylum employee per 21 patients. Medical historians estimate committed patients often received only 30 minutes of contact with a physician per month.

Consequently, those managing asylums sought low-cost treatment options. The lobotomy provided such an opportunity. Unlike the therapeutic or hydro and shock treatments available (all of which are still used today), the lobotomy was comparatively cheaper and did not take years to complete. It also frequently made difficult patients more docile and easier to manage.

Because superintendents received federal funding based on the number of committed patients rather than offering effective medical care, treating patients was a secondary matter. State agencies funding public asylums also faced little reason to care for the patient’s wellbeing. As we note in our article, many asylums would document the number of lobotomies performed to secure additional funding.

In contrast, private asylums, which also faced overpopulation issues and treated the same patient demographics as public asylums, were funded by philanthropic donors and the patients’ legal caretakers. When patients failed to improve, were mistreated, or not offered sufficient quality of care, an asylum risked its profitability. Accordingly, using erroneous or excessively harmful treatment methods like the lobotomy would be detrimental to their bottom line.

Predictably, private asylums and private practicing psychiatrists were significantly less likely to lobotomize their patients. In 1950, during the peak of the lobotomy’s popularity, only six percent of lobotomies were performed in private practices or asylums. The literature on mental asylums also notes most lobotomies in public asylums occurred within a few months after a patient was committed. Lobotomies performed in private asylums or private practice occurred after years (or decades) of failed treatment and typically at the patient’s request.

The use of the lobotomy in US medical history is a shocking and concerning event which continues to leave many asking how such a thing could happen. By examining the incentives stemming from well-intended but ultimately harmful public health policy, we can provide answers. Furthermore, while the lobotomy continues to offer a cautionary tale of medicine gone astray, we argue it should also provide a cautionary tale of the harmful consequences of state-assisted health policies. The lobotomy is an extreme example, but the reasons it became popular and endured are eerily familiar.

A recent study conducted by the Pacific Legal Foundation examined 2,952 regulations issued from 2001 until 2017 by the Department of Health and Human Services. The study found that 2,094 of these regulations (about 75 percent) were unconstitutional. Many of these rules negatively impacted small businesses and individuals’ well-being.

The HHS’s unconstitutional, excessive, and harmful rulemaking were nearly entirely driven by its largest agency, the Food and Drug Administration. Over the same period, 98 percent of the regulations enacted by the FDA (totaling 1,860) were found unconditional. Twenty-five of these rules had an economic impact of at least $100 million.

Perhaps even more worrisome is what makes these regulations unconstitutional (and illegal). The Constitution requires that regulations enacted by federal agencies such as the FDA or their umbrella departments such as the HHS come from principal officers. Typically, these officers are appointed by the President after Senate confirmation.

However, the vast majority of these regulations were passed by “low-level officials and employees with no authority to issue rules.” Legally, these regulations cannot be backed by the rule of law. As Thomas Berry, one of the study’s co-authors, notes, “Only properly appointed officers in the executive branch may issue regulations that are binding on the public. This preserves democratic accountability for significant executive branch actions.”

But the frequency of FDA’s issuance of fines and product-recall mandates strongly suggests the Constitution has little authority to restrict the agency’s “evolving regulatory powers.” Unfortunately, these powers have been evolving since at least the 1930s. Regularly allowing those with no legal authority to issue regulations is one of many examples.

So what can be done to hold these regulators accountable? Although difficult, the answer is to reduce their power. Luckily, pressure from the Trump administration to deregulate has shown some success in reducing the FDA’s enforcement actions. Right-to-try legislation reduces the agency’s authority to restrict access to potentially life-saving but unapproved treatments for patients with terminal illnesses. Other efforts to deregulate are also underway.

The findings in the Pacific Legal Foundation’s study are alarming but predictable. Government power, including its influence over the healthcare field, increases rapidly when it is left unchecked. The FDA’s rapid and illegal regulatory expansion is just one example. Let’s hope studies like these and others motivate the public to push back and discipline the FDA. It’s certainly overdue.

Industry-leading pharmaceutical companies, often referred to collectively as “Big Pharma,” remain one of the public’s least trusted entities. A major reason for this lack of trust is drug producer’s perceived influence over powerful legislative and regulatory bodies.

David Mitch, president and founder of the campaign group Patients for Affordable Drugs, echoed this sentiment when he wrote, “I sort of view Big Pharma, as an industry, as an octopus with many tentacles, and at the end of every tentacle is a wad of cash… It reaches into academic medical centers, professional organizations, patient organizations, state houses, campaigns, Congress – they’re everywhere.”

A recent career change from one of the most powerful men in the industry isn’t helping this image.

After serving as Commissioner for the Food and Drug Administration for just under two years, Scott Gottlieb unexpectedly resigned in April to spend more time with his family. He left behind a legacy of unprecedented expansion of the FDA’s regulatory powers, a persistent commitment approving generic drugs, and an unclear path for the future of the agency.

Eighty-three days later, Gottlieb announced he was joining Pfizer’s advisory board. He will also serve on the company’s science and technology committee as well as its regulatory and compliance committee.

Pfizer, one of the largest drug providers in the United States, is thrilled to have him. As Pfizer’s executive chairman of the board Ian Read stated, “Scott’s expertise in health care, public policy and the industry will be an asset to our company and enable our shareholders to continue to benefit from a board representing a balance of experience, competencies, and perspectives.”

Although Gottlieb provides a wealth of experience and expertise, many are upset that his previous role at the FDA provides Pfizer with a too-close-for-comfort relationship with the agency. One STAT article liked the transition to “walk[ing] through the revolving door” between the FDA and the pharmaceutical industry. Outraged, Senator Elizabeth Warren called for Gottlieb’s immediate resignation from the Pfizer board.

While there is cause for concern whenever regulators and the private sector form a partnership, we should first ask why this partnership exists. As with many issues in the U.S. pharmaceutical market, the issue stems from the FDA’s regulatory power.

In 1962, the Kefauver Harris Amendments granted the FDA authority to determine whether drugs were effective and safe. Granting the agency the power to decide which drugs were safe or unsafe gave it more ability to discriminate between pharmaceutical firms competing to have their products approved first. To compete for FDA attention, drug makers now needed a way to navigate new safety hurdles to have their products approved.

That way was for the drug industry to hire FDA employees. As Dr. Mary Ruwart notes in her book Death by Regulation, only ten percent of FDA officials left the agency for the pharmaceutical industry between 1959 and 1963. After the amendments took effect, the percentage increased to seventy-six percent. Such figures continue today as the FDA continues to develop “evolving regulatory powers.”

It is no surprise that Pfizer was eager to hire the former FDA Commissioner. Gottlieb knows perhaps better than anyone which drugs the FDA is most likely to approve and how best navigate their approval process. Other former FDA employees share similar insights, placing them in high demand.

Until these insights become less critical for drug providers than satisfying patient needs, the problems posed by “Big Pharma” will continue. Without reducing the FDA’s regulatory power, the agency will continue to be Big Pharma’s enabler.

A 2015 report released by the Centers for Disease Control found that nearly thirty million people in the United States had diabetes (about ten percent of the total population). The same report also found an additional seventy million people are at risk to develop diabetes in the next five years. These alarming figures are only expected to increase in the near future.

Managing diabetes usually entails a restrictive diet, regular physical activity, and regularly taken medication. Approximately 30 percent of diabetics require regular insulin injections to manage their condition. Those with type 1 diabetes are unable to produce insulin and typically require multiple daily injections to prolong their lives.

Tragically, although insulin is indispensable for many people with diabetes, it is also quickly becoming unaffordable. From 2012 to 2016, the price of insulin doubled. In 2016, the average person with type 1 diabetes spent nearly $6,000 on insulin per year. The American Diabetic Association found people with diabetes spent over $15 billion on insulin 2017.

When a life-saving medication becomes unaffordable, patients become desperate. Skyrocketing insulin prices have led many diabetics to limit (or ration) the amount of insulin they use to make financial ends meet. The trade-off is deadly. Not using enough insulin increases the risk of long-term complications or falling into a diabetic coma.  Survey results published in the Journal of the American Medical Association Internal Medicine finds nearly 30 percent of diabetics ration their insulin use.

To avoid financial hardship and medical complications, many diabetics have turned to black markets.

Some turn to the internet, where second-hand markets are providing solutions. For example, numerous kinds of insulin are available with 24-hour shipping from websites such as www.canadianinsulin.com. Millions of U.S. citizens engage in such transactions.  Domestically, Facebook, Craigslist, E-bay, and other websites also provide ways for those needing insulin and those willing to sell it to make an exchange.

However, buying insulin online, reselling insulin, and even giving it away is illegal in the United States. These barriers work to complicate how willing buyers and (re)sellers can exchange. For example, some insulins must remain at room temperature, or they expire prematurely. Operating on the black market makes this and other safety standards a secondary matter, increasing the risk of buying and using expired insulin, which can be harmful.

Others cross country borders to take advantage of cheaper foreign prices. A recently published article in the Washington Post reports that Minnesotan Lija Greensied, the mother of a diabetic child, went with five other people to Canada and “paid about $1,200 for drugs that would have cost them $12,000 in the United States.” Elated, Lija noted, “It had been years since I had 10 vials [about a year’s supply of insulin] in my hands.” Others have had similar success traveling to Mexico to buy insulin.

But bringing prescription drugs across the U.S. border is also illegal. Those who attempt to bring foreign drugs into the U.S. risk having their medication confiscated or facing criminal charges. Although the Food and Drug Administration makes some allowances, they are best selectively enforced. Purchasing drugs in foreign countries also poses the risk of receiving counterfeit medications.

The rise in black markets for insulin provides both a deeply concerning picture of the harmful effects of regulation and the incredible ability of international competition to curb pressing healthcare concerns. Although drug importation policy between countries with different quality standards and pricing strategies is complex, the efforts of millions of U.S. patients to obtain cheaper foreign drugs indicate solutions are possible.

With President Trump considering reforming drug importation policy to lower prescription drug costs, let’s hope the struggles of many diabetics to navigate black markets and prolong their lives provides enough motive to liberalize foreign drug access. Managing diabetes is challenging. Managing diabetes and poorly designed policy only makes already difficult situations more taxing.