Drug Development - Is There Another Way?
I'd like to start this by saying that I am by no means an expert in health care and do not invest in health care companies.
This post was inspired by Alex Berensons's piece on the NY Times today talking about the looming lawsuit crisis in the pharmaceutical industry.
Here are the problems as I see them with the way the pharmaceutical industry is set up today:
1 - Drug prices are sky high making them unafordable for many lower and middle income people.
2 - Medicare is going to cost even more because of the new drug benefit which to date over 30 million people have signed up for.
3 - New innovative drugs are not available because of the lenghty clinical trial process.
4 - There is limited competition in the pharmaceutical market due to long term patent protection
5 - It takes at least $100mm and often many times that amount to develop a new drug and get it to market.
6 - The pharma companies are starting to get hammered with lawsuits resulting from deaths or people becoming seriously ill from approved medications.
What if we set up a second way for drugs to come to market?
What if the person who discovers a new compound "open sources" the discovery? What if they allow any company with a valid license to make the drug? What if the government allowed anyone to take the drug who knowingly signed off on the risks involved? What if the person who took the drug waived all rights to sue the maker of the drug? What if the person who took the drug was required to complete a questionaire on the outcome and side effects that was made publicly available? What if the maker of the drug was not allowed to market the drug to patients? What if doctors were required to analyze the public data on outcomes and side effects before prescribing the drug?
I have no idea if any of this makes any sense for the drug development business. But this is akin to the new way that technology is developed and taken to market. Why doesn't this make sense for drugs as well?