Pain and Profits: The History of the Headache and Its Remedies in America

Published by EH.NET (May 2008)

Jan R. McTavish, Pain and Profits: The History of the Headache and Its Remedies in America. New Brunswick, NJ: Rutgers University Press, 2004. vii + 239 pp. $24 (paperback), ISBN: 0-8135-3441-0.

Reviewed for EH.NET by Marc Law, Department of Economics, University of Vermont.

Janice McTavish’s Pain and Profits is an entertaining and informative history of headache treatments in America from the early nineteenth century until the present day. In this extremely readable and well-researched book, McTavish, an assistant professor of history at Alcorn State University, explores how developments in the practice of medicine, the pharmaceutical industry, and government regulation influenced how headaches were treated and perceived by physicians and patients. McTavish bases her account on a wide range of sources including contemporary newspaper articles and drug advertisements, court cases, government records, professional and trade journals, as well as a vast array of secondary source materials. This book is highly recommended for historians of medicine, as well as for scholars interested in the complex interactions among pharmaceutical companies, the medical profession, and government policy. Also, readers who are familiar with the James Harvey Young’s (1961, 1967) work on the history of the patent medicine industry will find this a welcome addition to the literature.

The structure of Pain and Profits is roughly as follows. Chapter 1 describes how headaches were understood and perceived by doctors and patients during the early nineteenth century and the various and often peculiar ways in which headaches were treated. During this time, physicians were generally unwilling to provide symptomatic relief to headaches. The prevailing view was that such treatment would frustrate efforts to cure the patient of the underlying condition that caused headaches. Accordingly, self-medication became the norm for patients seeking pain relief and the demand for headache remedies largely came directly from consumers. Chapter 2 discusses the supply side of the market for headache remedies. McTavish notes that the pharmaceutical trade was split into two (overlapping) camps: the so-called “ethical” drug trade, which sold products only with a physician’s prescription, and the “nostrum” or “proprietary medicine” industry, which marketed its products directly to consumers. Snake-oil headache remedies were an important component of the patent medicine trade, in part because these products bypassed a medical profession that was generally reluctant to prescribe analgesics. In Chapter 3, McTavish details the uneasy relationship that existed between a reform-minded medical profession during the late nineteenth and early twentieth centuries that sought to control the public’s direct access to pharmaceuticals and profit-seeking pharmaceutical companies. Chapter 4 discusses how technological innovations in the German pharmaceutical industry ? most notably, the development of increasingly effective “synthetic drugs” like salicylic acid and phenacetin ? gradually began to change the market for headache remedies and as well as the attitudes of physicians and patients towards headache treatment. This chapter also explores the roles that patents, trademarks, and litigation over intellectual property rights played in influencing the prescribing behavior of physicians and the pricing of pharmaceutical products. Chapter 5 returns to tensions between increasingly powerful professions (physicians and pharmacists) and drug companies and describes the relative ineffectiveness of professional self-regulation and government regulation (for instance, the Pure Food and Drugs Act of 1906) in limiting the over-the-counter availability of headache remedies. Chapters 6 and 7 tell the story of how aspirin, the first consistently effective and safe headache remedy, became available to American physicians and consumers. These chapters also describe the intellectual property disputes over aspirin; how, as a result of World War I, property rights over this miraculous product were transferred from Bayer (its German developer) to Sterling, an American nostrum manufacturer; and the role played by Sterling in creating a mass market for aspirin. Finally, Chapter 8 discusses the evolution of medical understanding of headaches and headache treatment in the second half of the twentieth century.

While this book is more a social history than an economic one, economists and economic historians will nevertheless find grist for their mills in this relatively slender volume. For instance, the book is rich in detail about how German pharmaceutical firms like Bayer and Hoechst attempted to use America’s relatively generous patent laws to maintain their market power and prevent entry in the market for synthetic drugs; how this gave rise to differential pricing across national borders (Canada’s intellectual property laws did not provide the same level of protection); and how this in turn created arbitrage opportunities for the smuggling of pharmaceuticals from Canada. Additionally, McTavish, through her analysis of the market for synthetic drugs, demonstrates the importance of brand names in drug marketing and how confusion over the proprietary and chemical names of pharmaceuticals limited the ability of drug manufacturers to exploit their market power.

An interesting issue that McTavish does not completely address, however, is why the snake oil headache remedies peddled by nostrum manufacturers during the nineteenth century were so popular with consumers, even though they had little, if any, therapeutic value. McTavish is partially correct in suggesting that consumers were simply desperate for pain relief and that something was better than nothing. However, the more fundamental reason for the popularity of these otherwise worthless remedies is that drugs are a “credence good” (a good whose quality is difficult to discern even after consumption), not an “experience good” (a good where quality can be determined after consumption). Because most headaches eventually go away, and because there is no way an individual consumer can know whether improvement in her condition is due to the consumption of a drug or simply the passage of time, improvement in her condition might easily be misattributed to the consumption of a proprietary nostrum, even if the nostrum has no therapeutic value. This problem is likely to be pervasive whenever there is asymmetric information over drugs that deal with self-remitting conditions (see Carpenter 2005 for a theoretical discussion).

But this is a relatively minor omission from an otherwise excellent book. Pain and Profits is a must read for anyone curious about the history of the headache and its treatment in America.

References:

Carpenter, Daniel P. (2005). “A Simple Model of Placebo Learning with Self-Remitting Diseases.” Harvard University, mimeo.

Young, James Harvey (1961). The Toadstool Millionaires: A Social History of Patent Medicines in America before Federal Regulation. Princeton, NJ: Princeton University Press.

Young, James Harvey (1967). The Medical Messiahs: A Social History of Health Quackery in Twentieth-Century America. Princeton, NJ: Princeton University Press.

Marc T. Law is an assistant professor of economics at the University of Vermont. His research focuses on the causes and consequences of government regulation, with a specific focus on food and drug regulation, occupational licensing laws, and advertising regulation. Recent publications include “The Effects of Occupational Licensing Laws on Minorities: Evidence from the Progressive Era” (forthcoming in the Journal of Law and Economics, May 2009, co-authored with Mindy S. Marks); “The Political Economy of Truth-in-Advertising Regulation during the Progressive Era” (Journal of Law and Economics, May 2008, co-authored with Zeynep K. Hansen); and “How Do Regulators Regulate? Enforcement of the Pure Food and Drugs Act, 1907-38” (Journal of Law, Economics, and Organization_, October 2006).