Last month, the Biden administration announced it would allow Medicare to negotiate drug prices, prompting right-wing hysteria about price controls. Yet Biden's plans don’t go far enough: the state should fund R&D to further cut costs.
The truth is, the biggest pharmaceutical companies aren’t really drug development companies at all: they’re marketing, lobbying, and litigation firms with patent portfolios. While Big Pharma holds vast portfolios of existing patents for prescription drugs, the innovation pipeline for new drugs actually has very little to do with Big Pharma. In reality, public sources — especially the NIH — fund the basic research that makes scientific breakthroughs. Then small, boutique biotech and pharmaceutical firms take that publicly generated knowledge and do the final stages of research, like running clinical trials, that get the drugs to market. The share of small companies in the supply of new drugs is huge, and it’s still growing. Fully two-thirds of new drugs now come from these small companies, up from one-third twenty years ago. It is not the research labs of Pfizer that are developing new drugs.
This is completely true. The majority of research, at least for life saving drugs and not baldness cures, takes place at universities and small research firms, much of it funded by the NIH. If the investigators are successful, they spin off a company or license the IP.
Big drug companies then step in, long after the initial “drug discovery” is done. They have captured the regulatory system and, yes, can fund and run Phase 3 trials with their deep pockets and armies of bureaucrats, but at that point they are acting more like record labels, extracting rent (loosely defined) from a convoluted regulatory and distribution system that they themselves had a hand in creating.
This is completely true. The majority of research, at least for life saving drugs and not baldness cures, takes place at universities and small research firms, much of it funded by the NIH. If the investigators are successful, they spin off a company or license the IP.
Big drug companies then step in, long after the initial “drug discovery” is done. They have captured the regulatory system and, yes, can fund and run Phase 3 trials with their deep pockets and armies of bureaucrats, but at that point they are acting more like record labels, extracting rent (loosely defined) from a convoluted regulatory and distribution system that they themselves had a hand in creating.
Fuck ‘em.