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As a type 1 diabetic, I feel this. It sure seems like there's a lot more money to be made from me selling insulin, testing supplies, pumps, etc, that I'll need to use for life (29 years and counting) than in finding a cure, which perhaps they can sell me once, or maybe yearly. I know there are people working hard to find a cure, but I also know that they struggle with getting funding.
Same situation, same feeling. I also don’t have high hopes for disruption from some startup, people seem to underestimate how much harder startups in biotech are compared to tech.
isn't biotech a kind of "tech"?
From the little I've read manufacturing insulin and testing supplies doesn't seem terribly complex. I'm not too sure why there's so much profit to be made other than regulatory capture.
There is empirically a lot to be made in the US when you compare the price it's sold at and the cost of production.
Different formulations of insulin offer different benefits to diabetics. Ones that are more slow acting more closely resemble the body's natural regulation of insulin, and therefore do less harm to the body. Or so I hear.
Monopolization and patent evergreening. Monopolization is a natural tendency of markets, you should expect it often.
Same with Kidney failure when dialysis is 1% of the federal budget.
> It also suggests that companies be innovative and constantly expanding their portfolio of treatments.
This is the right approach, both for a company and for society. In fact, it's so obvious, that it's weird anyone thought they needed a report to say it.
Even if you only look at the business side (instead of the human side), only developing chronic treatments instead of cures only makes sense if there's no cure on the horizon. Once there is a cure, the people who sell endless treatments will lose money (they'll make basically nothing & they'll have a lot of sunk cost they can't recoup), while those who sell the cure will make practically all the money.
Besides, the people who run companies also have bodies (who knew?)), as well as family & friends with bodies. Eventually they'll want those cures too.
Alternately:
The right approach for a company is to give up making medicine. Why would you spend billions of dollars on scientists to research a cure and fighting the bureaucracy for its approval, only to have the people and the government turn around and scream at you that they cost too much, and demand you should give them away for free? Heck, just look Biden giving away the coronavirus vaccines — not buying the vaccines (or licenses to the vaccines) and giving them away, which would be eminently defensible and a fine expenditure on foreign policy outreach — just saying it'd be fine if no one enforced the IP rights on these things, giving away someone else's work.
So forget it. If the dollars work out so that the smart investor should spend his money on something else, it will happen. Will this result in fewer cures? Yes, but society has decided punishing people for making money is a more important priority than actually finding these cures, and our democracy operates on the premise that we've made our bed, so we can damn well sleep in it.
(There will of course continue to be a few cures coming out of publicly funded research and academia, but if they need to fight for grants with every other project out there, there's no way they'll have enough money to have the same output.)
>while those who sell the cure will make practically all the money
Why would they release a cure when they could make more money releasing their own chronic treatment instead?
A non profit-motivated actor might well want to do this just for the societal good it would bring. I think this though underlines a key flaw in the idea that everything ought to be market driven. In some cases you end up driving yourself in contortions working out how to incentivise the market to behave in a certain way. Sometimes it better just to fund the damn thing directly.
I suspect the answer will be something like "maybe they won't, but their competitors are incentivised to", which naturally ignores the long history of price fixing and collusion.
Releasing a cure for a condition with treatments in the market already is a much easier sell than releasing yet another treatment that you now have to market to everybody on the current thing. If the first couple players are in a treatment-only business, newcomers are incentivized differently than those initial players were.
The more complicated answer is that if it's something poorly-understood where you came make different-but-similar treatments that will work better for some patients than others, and the current patient base isn't fully covered, there's still lots of incentives for treatment. Look at something like chronic inflammatory/immune stuff, and all the biologics out there.
But then the answer to "why didn't someone just develop a cure" isn't just economics and greed, but also nobody knows how.
In the surgical space, we actually do push expensive procedures over chronic therapy fairly often for things like joint or back issues. Of course, in that case, the economics are obvious - the surgeon and facility make their money that way. So if you can similarly convince the governments and insurance companies that your expensive cure is gonna save money compared to a lifetime of treatment (for surgery, this is being increasingly questioned, even), you can charge a lot for it.
I feel this is a valid question, particularly considering patents.
> Why would they release a cure when they could make more money releasing their own chronic treatment instead?
Because the probability of finding a cure, chronic or not, is extremely small.
Because someone else will release the cure at some point.
Someone else might make the cure and they corner the market?
Kind of a crappy article. The example of Sovaldi is a terrible one.
Prior to Sovaldi, the best selling drugs were Lipitor, then Humira which made ~$10B per year at peak worldwide (peak being a decade or more post launch). Think about the time value of money when your R&D investment hit peak revenue 10-15 years later.
Sovaldi made $12B in its first year full year. What did Gilead make across all its hepatitis C drugs that year? $19B. That blew all records out of the water. And 6 years later it’s pulling in $4B. Note this is in an industry where exceeding $1B at peak is a success.
The hepatitis C cures are an absolute blockbuster by any stretch of the imagination.
https://www.evaluate.com/vantage/articles/data-insights/hep-...
I think it is past time to reform the Orphan Drug Act. It is open to exploitation by bad actors (Martin Shkreli, etc.), and the problem seems to only be getting worse. While we are at it, we should expand the act to try and help address the problem that treatments are less profitable than cures.
We also need to start putting in sunset provisions in laws of this nature. Governmental intervention in the economy should have mandated expiration/review dates.
We need to take the business out of medicine.
This. Medicine and the profit motive do not mix.
That's not what the data showed. Doctor-run hospitals, before ACA disallowed new ones and restricted existing ones from expanding, had overall better patient outcomes than state run hospitals.
MRI scans, which could sometimes mean the difference between life-saving diagnoses, or a missed diagnosis, were cheaper and easier to come by in the U.S. because clinics could run a scanner at a profit and specialize in MRI scans. Locking them away under government rationing destroys the cycle of signal and response a market can bring. We've seen this in other countries where it is exceedingly difficult to get one when you need one.
That doesn't mean there aren't sensible cases for government-funded research. But looking at the current health system with massive government interventions already in place and saying the problem is not enough government intervention seems like a mistaken conclusion.
You do realize this doesn't work, right? Pharma "profit margins are very high", okay, but that means 10% (yes like everywhere there's that one company that does 30% for a while, averages however).
So 100% nationalizing them would change the cost of a $300,000 per year treatment to ... $270,000 per year. Nobody is waiting for that. Frankly even a 30% reduction, the top of the line, would not really matter to people.
The only thing separating medicine and the profit motive will do is stop the development of new drugs. There's no way in hell the government will invest even 10% of what the private sector invests in new drugs. That would be a 10000%+ budget increase for universities. It's not happening. So drug and treatment development will slow to a crawl. So is it better to die because no-one cares to look at you at all than to die because someone doesn't want to pay for your cure?
Apparently it is, according to responses here, but I truly don't understand why.
And if that's what you want to do, let people die, then why not just legislate that you can't buy coverage for diseases with <N cases per year? That would avoid all the inefficiency.
If more people learned what "managing," really means, the idea of the business of managing disease instead of curing it would be more intuitive.
It seems simple, but only if you know it. Managing means you have at least two factors that form a 'dynamic,' so that there is a differential between them that you can extract variable levels of value out of. Managing a team means you have different people whose work is like cylinders of an engine firing at different times to create continuous motion. Some people have a knack for maintaining the equillibrium that produces power. Managing a product is a dynamic of market demand and feature cadence that produces sales.
From this perspective, a disease is a dynamic, however dubiously ethical it may to treat it as one, whether as a business making money or a government effecting policy.
However, curing patients is only a business model insomuch as you can produce cures dynamically to create a cure-machine to rent out. From a business perspective, curing diseases is zero-sum and destroys long term value. If you cured covid, the ~$100bn+ of value you created would be a one-off, and it would remove a powerful dynamic from both government and industry, and just be another relatively small capital management problem instead of a long term growth disease mangement problem, like say, periodic booster shots.
Solving problems collapses uncertainty and in-effect, destroys opportunity for people who use the dynamic to manage the world. Viewed this way, disease management is not a conspiracy, it's just a lot of people with a certain skill set who respond to the same incentives. It's truly a banal sort of evil.
(edited to remove digression)
Healthcare is not "business". Well it shouldn't be anyway. Same goes for other essentials that one cannot do without such as food, water, air, etc. But the current system is insufficient (or unwilling to) to model this reality.
If the pharma industry can invent something like Ketracel-white for some dread disease like cancer or heart problems they would do it.
Background: in the Star Trek series Deep Space 9, some of the bad guys are an expansionist empire led by shapeshifters who've bred a race of perfectly loyal super-soldiers whose loyalty is ensured, in part, by an inborn need for a substance called Ketracel-white, which substance is very difficult to synthesize, so they're dependent on their overlords for a consistent supply, else they get sick and die. It's basically the lysine deficiency from Jurassic Park, but for humanoids.
There's also an episode of Star Trek: The Next Generation in which one alien planet has hooked a second alien planet's entire population on addictive drugs, having convinced the addicts that withdrawal symptoms are a terrible, incurable disease that the drugs are treating.
Love the obscure reference.
Money should not be The Goal. It is a means to reduce friction in trade and we need to keep it in its place.
Historically, many cultures put medicine and spirituality under the same umbrella. A "medicine man" was both a spiritual leader and a healer.
You need someone to actually care about you to get you well. When their relationship to your disease is rooted in profit motive, the end result is torturing you so you die slowly.
This needs to stop.
I don't know how we fix our medical system, but such things exist to serve humanity. Humanity should not be a prisoner or slave to such garbage.
When it comes to curing some chronical conditions, I am intrigued by the research of Prof. Roy Taylor of Newcastle University, England.
Taylor et al. have been studying effects of short-term fasting on diabetes 2nd type and they claim that they can cure or at least significantly improve the condition by fasting, especially if the fasting therapy is introduced soon enough after the initial diagnosis of T2D. Even NHS England is paying attention to their work.
https://www.ncl.ac.uk/magres/research/diabetes/reversal/#pub...
This is about as cheap cure as it gets. Eating nothing for some periods of time does not cost any money and there are no patents/royalties attached. The only trouble is that it might be less comfortable than taking pills.
If Taylor is right, we could get rid of a significant part of our disease burden. Fast food producers would fall on harder times, though.
This was indeed good news. But most obese diabetic people find it nearly impossible to follow such a diet. I have such a diabetic friend who is trying, but even with the Covid quarantine and his daughter policing his diet he has yo-yo'ed in weight, losing 35 lbs only to regain 15, partially due to his cravings for snacks & candy bars that he smuggles into the house or eats while out.
A possible 'solution' is for governments to offer lucrative bounties on cures, e.g. $50b to cure Thyroid cancer. And then have the cure's IP freely available.
The more serious question here is how do you make cures more attractive compared to chronic treatments.
Maybe we need to start paying for cures like we do chronic treatments?
maybe the profit motive is a perverse incentive for taking care of people.
Maybe. But I don't think there are any alternatives right now. And it doesn't seem like a bad for people helping others to be rewarded...
This is the problem of planned obsolescence but in a medical context where it’s especially harmful. Why produce a lightbulb that lasts 2000 gotta when you can sell twice as many that lasts 1000 hours
Would shorten the patent expiration on chronic treatment help address the problems? Making chronic trainer competitive and cheap would discourage the tent seeking behavior.
Don't hate the player, hate the game.
More and more as our capabilities increase we have more options than ever before in deciding what to do and how to do it. In the past, any treatment for any prevalent condition was a no-brainer benefit to society.
Now we're heading into territory where our government+economics+capitalism is a solution to an X-Y problem. There will come a tipping point where capitalism is less efficient than alternatives. Healthcare is perhaps the largest, most visible, and pressing one of these. Once we recognize the pattern, more will become apparent.
What's the difference in cost of a covid test vs covid vaccine?
The cost of healthcare should be borne by society without a profit motive for the exact same reason we do it that way for firefighting services. Many nations other than the USA pay less overall and also receive better care and have better health outcomes, there is no good reason to preserve the current US system.
The US (and Canada) invents more drugs than the rest of the world combined. Maybe Americans are paying the price for all those other countries to get those better outcomes cheaper and without their sacrifice, everybody would lose.
Anecdote - 20+ years ago my colleague told me how his wife worked in the pharma industry.
She was studying a potential product to 'cure' some disease or other. Apparently her initial tests on the company's product worked amazingly well, removing all trace of the disease with just a few doses.
She was excited to report this success to her boss, who replied "That's Horrible!". The company wasn't interested in a cure that requires only a few doses, but something that requires a longer-term rent-seeking subscription plan.
I work in this industry and this doesn't ring true.
It would never be the case that a single researcher does some tests and reports them to the boss except in the very earliest stages of drug development. The "boss" in this situation would be another research scientist, far removed from business strategy.
Even then, success in a petri-dish doesn't mean much - it would be years of research with a large team to determine if it was safe and efficacious in human trials.
The idea that the pharma industry suppresses viable medicines because they are "too good" is just conspiracy theory.
This seems implausible. It’s extremely difficult to find cures in the first place, and in the event a company does, the US is willing to pay a ton for them (see recent Hep C medications).
I would need more proof before being able to believe an executive team would throw away a sellable cure for an extremely low probability of finding a longer term rent seeking subscription plan.
This sounds like it went through a few rounds of telephone and lost some details. There are numerous details to this anecdote which are incompatible with the simple interpretation "pharma actively avoids cures"
Since we’re sharing anecdotes, a relative of mine is a retired oncologist and he’s pretty cynical towards big pharma as well. He’s witnessed patents on drugs for chemotherapy expire only for the company to introduce basically the same chemical compound with minimal changes as a new pharmaceutical, obtaining a fresh patent and of course the ability to set near arbitrary prices again. These “new” drugs could easily have worse side effects than the previous ones, too. Then they’d buy out the committees responsible for setting treatment guidelines so they’d recommend the new drugs, and to complete the puzzle, if doctors deviate from these guidelines they’re liable for potential damages. Note this is Europe and I’m not too clear on the details, but you get the gist of it.
The incentives of capitalism means that the ideal goal for pharmaceutical companies is Amazon Prime, but you need to subscribe to stay alive. We need to change the incentives because this is a bad outcome for society.