<
https://www.techdirt.com/2022/10/03/new-study-shows-that-high-rd-costs-dont-explain-high-drug-prices/>
"For
years, defenders of pharma patents
loved to claim that the reason that
they needed patents
and the reason they
had to charge extortionate rates
for drugs was because of the high cost of R&D for new drugs. The numbers keep
going up. When I first started covering pharma patents, the number bandied
about was $600 million per new drug. Then it jumped to $800 million. Then $1
billion. The latest I’ve heard them claiming is an average of $1.5 billion per
new drug.
The number has always been bunk. Back in 2004 (at which time pharma companies
were claiming $800 million per pill), Merrill Goozner wrote an excellent book,
called “The $800 Million Pill” which completely rips this number to shreds, and
shows how massively inflated it is. While the book is a bit out of date now,
it’s still a really interesting read, and shows how almost every major new
successful drug was mostly funded by the federal government (i.e., your tax
dollars) with the pharma companies shouldering a tiny, tiny fraction of the
purported costs. Similarly, the book “Against Intellectual Monopoly” showed
that the costs claimed by pharma companies was greatly exaggerated, and often
the vast majority of the money came from taxpayer funds, with only a tiny bit
being taken on by private industry. In addition, much of the cost is from the
clinical trials, and there’s an argument that
that is also something that
would benefit greatly from federal funding (there are plenty of stories of
sketchy behavior by pharma firms when it comes to some clinical trials).
Anyway, given all that, there’s a new study out that highlights (in a different
way) that the claims of high drug prices being due to high R&D costs is pure
bullshit. The study did something I’m surprised no one has done before:
compared drug prices with the price of R&D on those drugs. If the high cost of
development was really what was driving the high drug prices, there should be
some correlation there, right?"
Cheers,
*** Xanni ***
--
mailto:xanni@xanadu.net Andrew Pam
http://xanadu.com.au/ Chief Scientist, Xanadu
https://glasswings.com.au/ Partner, Glass Wings
https://sericyb.com.au/ Manager, Serious Cybernetics
