How Merck Created a New Disease (Osteopenia) to Sell its New Drug, FOSAMAX/ NPR

MUST_READ from NPR (thanks to Marc Crispin Miller)

... armed with the firm conviction that he was about to do good in the world, and coincidentally sell a ton of drugs for Merck, Jeremy Allen set out to completely rework the way that bone was measured in America.

Now, to do this, he figured, the first thing he needed was an institution, an entity whose mission was not to sell drugs, but to serve the public good. So he decided to create one. In 1995, Allen convinced Merck to establish a nonprofit called the Bone Measurement Institute. On its board were six of the most respected osteoporosis researchers in the country. But the institute itself had a rather slim staff: Allen, you see, was its only employee.

Mr. ALLEN: There was no payroll, there was no building, there was no office with the name Bone Measurement Institute...

... Jeremy Allen says that to encourage other companies to take seriously Merck's goal of dropping the price of measuring machines, Merck actually purchased a bone measurement business.

Mr. ALLEN: We bought one of the companies and showed how low the price could become purely to get everybody's attention. And we got everybody's attention. And subsequently, when everybody else moved, we let it go, and the company closed. And we cheered its demise...