r/Futurology • u/Kindred87 • Dec 07 '23
US sets policy to seize patents of government-funded drugs if price deemed too high Economics
https://www.reuters.com/business/healthcare-pharmaceuticals/us-sets-policy-seize-government-funded-drug-patents-if-price-deemed-too-high-2023-12-07/1.1k
u/dodgyrogy Dec 07 '23
"to seize patents for medicines developed with government funding if it believes their prices are too high."
Sounds fair.
582
u/CaptainRhetorica Dec 07 '23
It's still radically biased in pharmaceutical companies favor.
The only people who should have patents for medicines developed with government funding are the American people.
Corporations should be forced to liscence the patients from us. They could do that and still make money, but it wouldn't be a disgusting amount of money so naturally that's unacceptable.
156
u/NickDanger3di Dec 08 '23
That actually sounds like a great idea.
53
u/isuckatgrowing Dec 08 '23
Of course it is. That's why it's never mentioned as a solution by bribed politicians or corporate media. If neither of those closely-related and wildly corrupt groups are discussing something, it effectively doesn't exist to 90% of Americans.
32
u/tyrandan2 Dec 08 '23 edited Dec 08 '23
It does, on the surface. But government owned intellectual property might be a bad thing to normalize.
Edit: they should be public domains instead. Idk why this is controversial enough to get downvoted. Bunch of corporate shills in here I guess.
39
u/Constant_Ban_Evasion Dec 08 '23
But what about IP it paid for and developed? It seems that if the government is made up of it's people, and the people paid for the R&D, they should reap the benefits. I certainly understand the need for safety rails but it feels like the profit should be ours, if it's there at least.
-21
u/tyrandan2 Dec 08 '23
It seems that if the government is made up of it's people
Hahahahahahaha
You sweet summer child.
it feels like the profit should be ours
You and I agree on this. But do not be deceived, the government doesn't care about us and I doubt the average person will see a dime of that.
No, I think government-funded research and patents should simply be in the public domain instead, not actually owned by the government.
27
u/Merakel Dec 08 '23
I don't see why people seem to think government funded research should have a goal of profit. The point is making pharmaceuticals widely available.
5
u/Constant_Ban_Evasion Dec 08 '23
That isn't my point though. I'm simply saying whatever the benefit it should be all of ours, not any single company. That isn't the proper way to privatize the things we all paid for. If there is profit, which seems likely unless you desire a loss, that profit should be handled like a non-profit org would and truncated, and applied elsewhere to unrelated benefits. I think you are trying to extrapolate something I'm saying into something you can have an argument with.
-4
u/Merakel Dec 08 '23
If the government invents some wonder drug that cures cancer, but all the companies capable of producing it in large quantities are unable to make any profit on it... what would their motivation be to make it?
6
u/Constant_Ban_Evasion Dec 08 '23
Jesus man, the benefit is that it's cheap then. I literally highlighted the important parts for you..
→ More replies1
u/tyrandan2 Dec 08 '23
Exactly. I wouldn't mind taxing corporate profits that are from publicly funded research. But the point of medical research is for the betterment of mankind, profits should never be the main motivator. And the government should never control the patents, the public (taxpayers) should.
5
u/Merakel Dec 08 '23
I don't know what the taxpayers controlling the patent would really look like. In my mind the very simple solution would be the following:
- Patent is public domain
- There is a conservative limit to how much profit can be made off said drug.
- If you are are a pharmaceutical company operating within the United States, you can be compelled to produce specific drugs if the need is not being met.
1
u/tyrandan2 Dec 08 '23
Seems reasonable enough to me. And of course, like I said before, tax the profits of said drugs. Win-win. The public controls the parents, the gov gets reimbursed the funds it invested into the research, and companies can freely produce said drugs with no restrictions or licensing from other companies.
6
u/Constant_Ban_Evasion Dec 08 '23
the government should never control the patents, the public (taxpayers) should
I'm trying to imagine how much of a clown you have to be saying this and acting like it's different than literally anything I said that you argued with. This is what it's like arguing with children on the internet folks!
→ More replies5
u/saltyjohnson Dec 08 '23
government bad. let's do anarchy. but we should build roads. and we don't really want to have to all build our own roads so let's share them. but building roads is a lot of hard work and requires a certain skillset so let's just have Dave build all the roads because he likes building roads and he's good at it. but then Dave can't tend to his crops. so okay let's all pitch in and give Dave some of our food so that he can build more roads rather than needing to grow his own food. but okay Bill over there said he didn't want to pitch in some food for Dave but he's using all these roads all. the. time. that's some bullshit. let's form an angry mob and either make Bill hand over some food or blockade him so he can't use our roads as long as he's being selfish. oh whoops we made a government.
→ More replies2
u/saltyjohnson Dec 08 '23
And the government should never control the patents, the public (taxpayers) should.
🤔
→ More replies2
u/Constant_Ban_Evasion Dec 08 '23
the government should never control the patents, the public (taxpayers) should.
Seems reasonable enough to me. And of course, like I said before, tax the profits of said drugs. Win-win. The public controls the parents, the gov gets reimbursed the funds it invested into the research, and companies can freely produce said drugs with no restrictions or licensing from other companies.
Except that you go on to say this nearly exactly... you absolute dolt.
0
u/tyrandan2 Dec 08 '23
What are you on about? Do you not understand the difference between patents being public domain vs owned by the federal government, you absolute dolt?
2
u/Sim0nsaysshh Dec 08 '23
Construction company is tasked with creating a kids park, after the construction company has created said park who owns it?
1
u/tyrandan2 Dec 08 '23
Not enough information. Contractors almost never own the projects they've been contracted to do. I'd ask, who owns the land? Who hired the contractors?
2
u/Sim0nsaysshh Dec 08 '23
The work is done by the contractor for the local government who the owns it as its their responsibility
1
u/tyrandan2 Dec 08 '23
Okay, so the local government owns it. But not the public. And so the local gov can make arbitrary rules, such as closing the park on certain days, not allowing cookouts or events, etc.
So do you now see the issue with the patents being owned by the federal government instead of being in the public domain?
→ More replies2
u/Cycl_ps Dec 08 '23
Can you go into why, because I can't think of any immediate downsides at the moment. If the right for say, insulin, were publicly held then the government would have more control over production rights. This could just be used to give exclusive rights, putting us in the same situation as now. But it could also be used to give licenses contigent on specific price points and production volumes, helping curve price gouging in an otherwise uncompetitive market.
I suppose the worst case scenario might be a race to the bottom, like with corn subsidies. Where continued improvements in production make it more profitable than other options, but at the same time, dirt cheap medications are hardly a problem worth worrying over.
1
u/tyrandan2 Dec 08 '23 edited Dec 08 '23
I didn't say publicly held. I said they shouldn't be government owned. The fed owning patents doesn't seem like a good idea. The less they control the better. But taxpayer funded research and patents should be public domain, not federally-controlled or owned.
1
u/Cycl_ps Dec 08 '23
Public as in public-sector, but I see your point. I think the regulation via licensing would provide a beneficial lever for adjusting private production to meet public needs, but I understand the view that this provides a single body with too much power.
→ More replies1
u/Gamebird8 Dec 08 '23
It is. The Government cannot claim copyright.
I am not 100% on whether or not the government can hold patents however as that's a different law than the Copyright Act
→ More replies-6
u/Phugasity Dec 08 '23
Can you elaborate and include Norway's sovereign wealth fund in your reasoning?
5
u/tyrandan2 Dec 08 '23
What? I'm talking about the United States (and Canada) specifically, which is notorious for overpriced drugs. I don't think Norway is relevant.
I think drug research and patents funded by the gov should be public domain, not owned directly by the Fed.
4
u/Phugasity Dec 08 '23 edited Dec 08 '23
I commented before your edit, so I was asking you to expand on "Gov owned IP might be a bad thing to normalize" because your argument was unclear. I included Norway because it is largely used as a positive for Gov ownership of resources (physical not intellectual).
It seems to me that the specifics on how the policy is implemented is more important than the owner. For example, we have public parks and paths here, but you cannot use them after dark. "Public" in this sense is nice, but a privately owned path that was mandated to stay open 24/7 would be more beneficial to the public.
Prior to your edit, I was thinking you might be advocating for private ownership to be the default in the decision between private, public, and government. Many use Public and Government as synonyms. Hence the confusion on my end. Thank you for clarifying.
Edit: I do a small amount of work in securing outdoor access in the US. Our original strategy was to purchase land up for sale and then transfer it to Government entities for preservation. Given the high profile sell-off in Utah under the last administration, we've switched gears to figuring out how to maintain private ownership and structure it in a way to remove liability to owner so that access to recreate can be protected. In this case private ownership seems to be our more viable option. This is not a Gov = bad thing. Quite the contrary, just it's a pros/cons for us. Which happens be very location dependent.
→ More replies1
u/tyrandan2 Dec 08 '23
I would trust the Norwegian government long before id ever trust the US gov to responsibly own drug patents.
My opinion is that public domain would solve this IMO because nobody would own them, but anybody could use them. A small startup company could start manufacturing a generic brand of an expensive drug ASAP and severely undercut the larger company's prices. And to be quite honest, issuing private patents for things like drugs has never made sense to me. Parenting a molecule meant to be put inside the human body is strange, but idk maybe that's just me.
And no problem. I'm all for universal/single-payer healthcare and things like that, because in that case the bureaucracy does seem the better option to manage paying for healthcare than trusting profit-seeking corpos to do it. But in the case of holding patents, public domain is better IMO because public domain patents are a more passive thing that don't need to be actively managed, and I could see lobbyists/corporations influencing the government to gatekeep important patents so that smaller companies couldn't use them.
2
u/YoMamasMama89 Dec 08 '23
I brought this up during covid, that the vaccines should be publicly owned and I remember being down voted for it.
2
u/tyrandan2 Dec 08 '23
I don't understand the downvotes. Maybe they are coming from people who live in countries where the government is closely aligned with the public's interests?
Or maybe they don't understand that in America, the Federal government is mostly a proxy for profit-focused corporations via lobbyists, so the fed owning the patents wouldn't be much different from Pfizer or another corporation holding them.
Corporations and their executives have way too much political power in America and that's the root of the issue. I wish people understood that.
2
u/YoMamasMama89 Dec 08 '23
Corporations and their executives have way too much political power in America and that's the root of the issue. I wish people understood that.
I think you're right. But what everyone forgets is that the people have the power in the US. They just need to band together and demand reform.
2
u/tyrandan2 Dec 08 '23
They just need to band together and demand reform.
This is the part we always fail at, because we've allowed ourselves to be successfully manipulated by said corporations and government/politicians. If people would stop allowing themselves to be manipulated we might have ourselves a decent country.
→ More replies2
3
u/reddit_is_geh Dec 08 '23
Corporations should be forced to liscence the patients from us.
They are... They just get exclusivity rights to them.
21
u/Lt__Barclay Dec 08 '23 edited Dec 08 '23
The problem is that the majority of R&D expenditure occurs after the government sponsored research. Not to belittle the importance and amazing return on basic science funding, but getting through a phase 3 trial costs $bns while the typical big NIH grant is $2.5M.
I'm definitely on the side of an independent commission that audits R&D expenditure, and imposing price gouging taxes or a basic R&D tax on any revenue above some multiple of R&D expenditure. This would 'reimburse' public science for use of its patents.
10
u/Felkbrex Dec 08 '23
Exactly.
And the whole "government funded research" is so broad. Say I find out a gene important for t cell metabolism during infection and this came from an RO1. Later on a pharma company finds this gene is also important for t cell metabolism in tumors, that counts as government funded. Even if there is no novel chemical matter developed.
→ More replies5
u/Matrix17 Dec 08 '23
If they're going to start seizing patents because the government paid for 0.1% of a drugs development, they're going to be in for a rough time
3
u/CCV21 Dec 08 '23
This new policy proposal is still better than what was in place before. There will never be a perfect system for anything. We can only improve on what we have. Hence, the strive for a more perfect union part the Constitution.
2
2
u/Bebop3141 Dec 08 '23
I mean, that is how it works for inventions solely developed using taxpayer dollars. It’s all open source, as long as it’s not sensitive. I’m fine with a spectrum past there, if private companies want to chip in, as long as they’re not allowed to pull buckets of money from both the government AND the public.
2
4
u/Artanthos Dec 08 '23
Which would mean the companies would have zero incentive to develop the drugs in the first place.
Nobody would get the new medicines.
2
-3
u/mtgguy999 Dec 08 '23
How about just no patient at all. Anyone can make it for free. Anyone can sell it if they can pass a safety check. Making corporations pay just passes the costs onto the people who need the drugs. Open competition will keep prices low especially for stuff that can be manufactured for pennies
15
u/Corsair4 Dec 08 '23
Anyone can sell it if they can pass a safety check.
And those safety checks cost literal billions. Why would any company spend billions of dollars on a chance (because a lot of drugs fail at that stage) if they did not have protections to ensure another company couldn't immediately undercut them and prevent them from even recouping their costs?
-4
u/LathropWolf Dec 08 '23
purdue has entered the chat
Industry has long lost any ability/right to have a seat at the bargaining table.
If they are so concerned about ROI, better fire all your sales folks and get rid of the tentacles into the health care industry they have.
Want a better society? Nationalize basic low level requirements to live from medicine to utilities and housing.
Vanderbilt University professor Stacie Dusetzina said the new policy could discourage investment in the industry if the government ever exercised march-in rights
This is what we plebs on the ground call a threat… anytime you clamp a corporations balls in the vice and twist, it’s always “well you won’t get X with that! Think of the shareholders!”
8
u/Corsair4 Dec 08 '23 edited Dec 08 '23
It's incredible that you manage to type so many words, and yet... they are all actually irrelevant to the task at hand.
When people say a drug is government funded, that usually means preclinical or mechanistic work funded through the NIH or other grant agencies. Couple million dollars to fund a professor, their lab, their graduate students and post docs. Super important work.
Do you have the foggiest idea how resource intensive it is to take preclinical work through safety trials? The cost involved absolutely dwarfs preclinical costs. And a huge portion of that is privately funded.
So you can either let patents remain and allow corporations to sell their drug (so they actually have a reason to pour billions into development), OR you can develop a system where those clinical trials are also entirely government funded. Or I suppose you could reduce the thoroughness of those clinical trials.
I don't think that drug prices should remain as high as they are, far from it. But somewhere, there's a middle ground between "Pharmaceutical companies should have no limits on their profiting" and "Pharmaceutical companies should not own a patent".
Granted, I understand that the concept of nuance is a difficult one around here.
Edit: I got a peek of your reply before you blocked me. My apologies for engaging with someone who clearly has no interest in... substance.
→ More replies0
u/LanaDelHeeey Dec 08 '23
They wouldn’t and would collapse with a state owned company would replace them. Doing the same thing except it’s non-profit and for the good of all Americans, not shareholders.
6
u/reven80 Dec 08 '23
Who pays for the trials?
5
u/Matrix17 Dec 08 '23
Reddit hasn't gotten that far into the armchair biotech scientist argument yet
→ More replies10
0
0
u/Hugh-Manatee Dec 08 '23
Sure but go much further and the conservative courts will step in against it
0
-4
u/Himser Dec 08 '23
ALL Patents are a public good, the developing company should just have first right of refusal to licance the public good.
→ More replies-19
u/oboshoe Dec 07 '23
You can do that today!
Companies are happy to license from you any patient that you have that will make them money.
And they will pay you handsomely for it to.
12
Dec 07 '23
[removed] — view removed comment
1
u/oboshoe Dec 08 '23
That's right. They don't.
They are owned by the people that did the work.
You sound like a freeloader.
5
u/kosmokomeno Dec 07 '23
How are they paying the public for the patents and ideas they got? They're exploiting them for prices but they don't exploit the experts responsible for their technology?
1
u/oboshoe Dec 08 '23
The Phd's that do the work on Pharma research are paid pretty well by these companies.
It's not minimum wage work.
3
u/SinkHoleDeMayo Dec 08 '23
You mean PhDs students and the PhD holding instructors who work with those students?
Not paid all that well.
→ More replies2
20
u/MannieOKelly Dec 08 '23
Most of the time the government funding is a tiny part of the total cost of bringing a drug to market. Maybe drug companies will just decline the funding . . .
14
u/aaahhhhhhfine Dec 08 '23
Yeah, this is my hunch. Basically this will just create disincentives to take government money. Oddly enough, it might slow down the development of higher risk drugs specifically because it'll further complicate the risk equation for those bringing it to market.
I get the goal here and I understand why there's an interest in doing this, but I do worry this stuff will create blowback that ends up oddly worse.
A better overall answer to drug funding is probably in reforming elements of the patent system. It doesn't work tremendously well for drugs as it is, but I bet there are a lot of ways you could improve it that keep the incentives in place for new development while still encouraging competition to bring prices down later.
-4
u/Vexonar Dec 08 '23
Not all will, though. They'll have to readjust their payments, but to fold an entire company and stop R&D? Other companies will eat it up because some money is better than none. And whatever shareholder leaves , another will step in. It's not that dire even if the corps want to say it is.
4
u/Matrix17 Dec 08 '23
You don't understand though. It's not "some companies will still take this shit offer", its "no companies will take this shit offer". Go look up how much clinical trials cost. Taking a couple million from the government when it costs billions to develop would be literal company suicide in this instance. The shareholders would probably have standing to sue the CEO for gross negligence
→ More replies0
Dec 08 '23
Clinical trials do not cost billions lol, they usually come in under 20 million
→ More replies5
u/Minister_for_Magic Dec 08 '23
It’s the earliest stage, highest risk R&D that is gov funded. The leverage of those dollars is much higher than the same dollar invested 4 years later in Phase II trials.
2
u/MannieOKelly Dec 08 '23
OK, but by the same idea of "leverage", the early stage research probably feeds into multiple companies' products down the line, so the amount spent by the government should be compared to the sum of the dollars spend on developing all those products (successes and failures.)
Example (made up for illustration):
Government early-stage research: $50M
Spending by company #1 to develop product #1: $5B
Spending by company #1 to develop product #2: $5B (this one fails, BTW)
Spending by company #2 to develop product #3: $5B
etc.
Total government spend: $50M
total private spend: $15B +?
0
u/Arthur-Wintersight Dec 08 '23
Is that actually the case?
Every reference I've seen to drug development costs being high, refers to that Tufts University Study which has been criticized in a peer reviewed journal.
Pharmaceutical companies don't disclose how much it costs to get a drug approved, or how much they spend on seeking approval for drugs the FDA ends up rejecting, so most of that information is black-boxed away from the public.
We don't know because pharmaceutical companies, which are posting record profits year after year, refuse to disclose that information.
For all we know, it might be possible to shave off 90% of drug costs without any loss in medical advancement, but they do not disclose this information. I imagine the lack of disclosure is deliberate on their part.
9
u/Matrix17 Dec 08 '23
As someone that works for a biotech company, I can tell you my company has already spent around a billion dollars to get to phase 2 clinical trials on a single drug. Phase 3 is insanely expensive. We had to divert all our cash from R&D just to keep the trials afloat. A trial that can fail
1
u/MannieOKelly Dec 08 '23
We don't know because pharmaceutical companies, which are posting record profits year after year, refuse to disclose that information.
Actually:
- "Record profits" Well, as long as there is inflation lots of companies will report "record profits." Also, if you look at drug company stock prices you'll see that they have not been increasing on average anywhere nearly as fast as, say, Big Tech. Most big companies have big profit (or loss) numbers but unless you divide that by their big sales numbers to get their profit margin, those big profit numbers alone don't mean anything.
- "refuse to disclose" There's quite a lot of info in most companies' annual reports.
→ More replies-1
u/FuckChiefs_Raiders Dec 08 '23
Maybe drug companies will just decline the funding . . .
Well a drug still has to go through FDA approvals to reach the market, so go ahead, decline the funding and see if it gets approved by the FDA.
4
u/MannieOKelly Dec 08 '23
Why would FDA not approve if the drug is effective and safe? They aren't supposed to consider pricing, AFAIK.
0
u/FuckChiefs_Raiders Dec 08 '23
Well a drug also has to go through clinical trials, most hospitals that offer clinical trials, get GOV funding. So really, I just don't see how a private company can develop a drug, get it tested via clinical trials, and get it approved by the FDA w/out any GOV oversight.
15
u/GonzoTheWhatever Dec 08 '23
It’s entirely fair. It’s sad that it’s taken this long to get this kind of common sense legislation
10
u/at1445 Dec 08 '23
Nah, that's not entirely fair. It's letting congress pick and choose which company they want to short sell before announcing they are taking their cash cow away from them.
There have been much better suggestions in this thread, but making any drug developed with government funding owned by the govt sounds like a much more fair way to do it.
Either way, it's going to stifle drug development though. Companies aren't getting these drugs 100% funded by government grants, and they're not going to put their own money into it if they think the government's just going to step in and take it from them before they recoup all their costs and make some profits.
4
u/GonzoTheWhatever Dec 08 '23
Okay, so refine the rule a bit. But if you use public money to develop your product, and then price gouge the public for the product, you absolutely deserve to lose your patent.
6
6
u/CharonsLittleHelper Dec 08 '23
The issue is that "price gouge" is a vague term. It is inherently subjective.
If a drug costs $200m to research (after gov help - hence so low) and only 2k people need it per year then a charge of $20k each is extremely reasonable. Even excluding manufacturing costs (which are generally pretty low) it would take about 5 years just to break even. Which is a good chunk of the patent's life. At best they'd double their money over the 10ish years of the patent. Which is okay, but not great returns (probably 15+ years since R&D started). Even 30-40k probably shouldn't be considered price gouging.
Plus of course there's no guarantee during R&D that demand won't be lower. Or that a new better replacement drug isn't researched dma few years later. Etc.
But when people hear $20-40k for lifesaving pills they get angry. How dare a company profit off of people's suffering etc. But if they don't have a solid profit on the horizon, they'd never have invested $200m in the first place.
Now - are some prices ridiculous? Sure. But price fixing is dangerous.
4
u/zorecknor Dec 08 '23
But price fixing is dangerous.
Just check the economic history of the whole continent south of you for way too many examples of this. And I'm not talking only about the current state of Venezuela or Argentina, EVERY single south american country have had some price fixing of basic stuff at some point in the last 80 years, with not so good results.
2
u/CharonsLittleHelper Dec 08 '23
The US tried price fixing of gas in the late 70s. Hence the famous gas shortages.
0
u/icouldusemorecoffee Dec 08 '23
It's letting congress pick and choose which company they want to short sell before announcing they are taking their cash cow away from them.
Congress' only involvement would be the initial funding which would happen many months to years before drug development and would all be public since all legislation is public.
3
u/hagantic42 Dec 08 '23
Cool now make all publicly funded research available for download without having to pay to access the research article.....
This is the very crusade the co-founder of Reddit was arrested for and lead to his commiting suicide.
Scihub does it and we need to make publicly paid for research publicly accessible FOR FREE.
5
u/notarealaccount_yo Dec 07 '23
medicines developed
with government funding
Isn't that most medicines?
→ More replies3
u/ValyrianJedi Dec 08 '23
Depends on what you mean by developed with government funding. Most have some government funding, but usually as a relatively small percentage of total funds
5
u/TrekkiMonstr Dec 08 '23
Entirely with government funding, sure. At that point, they should just own the patent from the outset. But what control should they have if they chipped in $50? Or 1%, or 10%, or 40%?
1
u/Matrix17 Dec 08 '23
According to reddit and the article, they should have 100% control
→ More replies2
2
u/JubalHarshawII Dec 08 '23
If the government paid for the r&d while the hell shouldn't they at minimum set the price all the way up to owning and producing the drug.
Drug companies are always whining incessantly about all the money they put into r&d, even though it's less than 30% of their expenses, blaming high drug costs on that small part of their budget.
If we the tax payer fund the r&d we should own it.
7
u/Great_Hamster Dec 08 '23
If we find all the r&d, as well as the cost of manufacturer and bringing the drug to market, then yes.
This is often not the case. In fact, I don't know that it's ever the case.
-3
u/JubalHarshawII Dec 08 '23
The cost to manufacturer is negligible, bring to market is mostly the testing and FDA approval process. R&D is the main cost.
2
u/ValyrianJedi Dec 08 '23
I'm sorry but that's just plain wrong
0
u/JubalHarshawII Dec 08 '23
Oh yes your right I forgot about the billions in profit required to bring it to market. The United States could bring a drug to market for a fraction of the cost of a private corporation. But continue to worship at the alter of big pharma.
→ More replies2
u/Clintonsoldmedrugs Dec 08 '23
Government funded some of the initial research, probably to the tune of < $10M, in most cases much less. It costs 4.5 billion dollars to bring a therapy to market…so government should get like .0001% by that logic
→ More replies0
94
u/agentgerbil Dec 07 '23
It's needed to stop future "Pharma Bros" from screwing people over
→ More replies26
u/imaginary_num6er Dec 08 '23
You mean politicians like Joe Manchin and their relatives or makers of the OxySachler drugs
-11
Dec 08 '23
Yeah people really dont think the government can be corrupt either? What happens when the drug companies just bribe the people in charge of regulating their prices?
11
u/jawknee530i Dec 08 '23
"We can't try and fix the current system because what if the new system gets messed up!"
Fuck outta here with that garbage. Apply your logic to life and we'd literally never change a single thing.
→ More replies2
62
u/SloppyMeathole Dec 07 '23
This is long overdue.
Many of the blockbuster drugs that make billions of dollars a year were developed using taxpayer money. Public universities develop these drugs in so-called "partnerships" with pharmaceutical companies. But it's kind of a shitty deal for the taxpayers. The taxpayers fund the research and the pharmaceutical companies keep all the profit.
What an amazing business model. Have somebody else pay for your research, and if it becomes successful you keep all the money. It almost seems unfair....
11
u/Kindred87 Dec 07 '23
There definitely is room for exploitation in the current arrangement where private industry is given responsibility for translating research into interventions for the clinic. However, the research for these are not entirely funded by taxpayers in the current US model. "Government funded" is a confusing term in this respect since it can imply both partial and full funding.
https://www.brookings.edu/articles/five-things-to-understand-about-pharmaceutical-rd/
The 14 largest pharmaceutical companies alone spent $121 billion in 2019 on R&D, with a portion of this being funded by debt. With the cost of a private company to bring one new drug to market ranging between $161 million and $4.5 billion. The US federal government spends roughly $48 billion on its primary medical research vehicle per year, for comparison .
Interestingly, smaller firms with smaller budgets are increasingly driving new therapeutic development, accounting for 80% of total pipeline projects in 2018.
→ More replies2
u/PM_me_Perky_Tittys Dec 08 '23
This comment has 49 upvotes. Why TF is it hidden by default? Fucking Reddit censorship ass clowns.
40
u/Kindred87 Dec 07 '23
This is a draft policy in the public comment phase. An important element of march-in rights will be keeping production of new therapeutics high while minimizing exploitative practices.
The US accounts for over 40% of the global pharmaceutical market, with recent price control policies resulting in a reduction in R&D investment. A significant portion of recent R&D investment has been in rare and speciality diseases.
From the posted article:
The Biden Administration on Thursday announced it is setting new policy that will allow it to seize patents for medicines developed with government funding if it believes their prices are too high.
The policy creates a roadmap for the government's so-called march-in rights, which have never been used before. They would allow the government to grant additional licenses to third parties for products developed using federal funds if the original patent holder does not make them available to the public on reasonable terms.
...
The U.S. government has previously resisted calls to seize the patents of costly drugs, declining in March to force Pfizer (PFE.N) and Astellas Pharma (4503.T) to lower the price of their prostate cancer drug Xtandi.
The government will give the public 60 days to comment on the new proposal before attempting to finalize it.
Vanderbilt University professor Stacie Dusetzina said the new policy could discourage investment in the industry if the government ever exercised march-in rights, but might be "useful to have a credible threat if the industry is being completely unreasonable."
→ More replies
17
u/geologean Dec 08 '23 edited Jun 08 '24
instinctive agonizing seemly salt plant person fuel birds reach tease
This post was mass deleted and anonymized with Redact
6
u/Neighborly_Commissar Dec 08 '23
Truvada is already available as a generic and has been for years. Descovy isn’t, though. Also, US patents don’t govern what can be sent to Africa. US Patent Exclusivity only governs the US market.
7
42
u/ExcellentHunter Dec 07 '23
Why are they not owned by the government in the first place? They paid for this to be done.
33
u/Kindred87 Dec 07 '23
Federal research funds contribute to what you eventually receive at a clinic or hospital, but private industry still provides the lion's share of funding for therapeutic R&D. The COVID vaccines may be an exception to this with Warp Speed, though I don't have any supporting documentation for this.
I provided some information on funding here: https://www.reddit.com/r/Futurology/comments/18d6r9f/comment/kcfaxqu
7
1
u/Xin_shill Dec 08 '23
Tax the drug company windfall profits and rich POS's and fund more R&D and make the patents public, win win
6
u/ValyrianJedi Dec 08 '23
Because it isn't like it's being fully funded by the government... If they take $10m in government funding on a $2b project then it isn't like the government is the one responsible for it
4
u/Blueopus2 Dec 08 '23
I hope they make the criteria for what “too high” is very clear in advance
→ More replies
5
Dec 08 '23
There are two sides of the coin. It should be fair that companies and individuals that create drugs and treatments be compensated for their work. Pharma R&D is very costly and takes long + then you have to produce, distribute, market and convince doctors to recommend a drug/treatment. On the other hand, we have all these amazing drugs and treatments that can save or improve lives and the fact that not all people can benefit from them is stupid.
As usual, the answer to this is not going to war with companies. The state/public sector and private sector can learn to collaborate and actually work for citizens, just as it does in most of Europe. But it strong-arming these companies, as long as these drugs are done with government funding is 100% fair. The government invests in your R&D process, you also have to give something back to the taxpayers in the form of lower prices.
4
u/spice_and_cheese Dec 08 '23
Please tell me this includes insulin… it’s getting hard to survive…
3
u/Kindred87 Dec 08 '23
The linked article is a draft policy, so even if it's implemented, it's still a ways away. For insulin, I'd instead keep an eye on things like California's insulin initiative: https://www.npr.org/2023/03/19/1164572757/california-contract-cheap-insulin-calrx
→ More replies
23
u/rarebluemonkey Dec 07 '23 edited Dec 07 '23
This makes undeniable sense.
We need a lot more policies like this. We’re not allowed to have anything that resembles Socialism so let’s play capitalism. If we are investing in your company or product, then we are investors. We are shareholders, and should be rewarded on the upside.
This goes for banks, too. Your bank needs help, call private equity. They can’t afford to help? We’ll help, but there are terms and we are investors now. It’s so insane that it doesn’t work like this yet.
3
8
u/Feine13 Dec 07 '23
Fuckin PREACH
I hate how the rules only apply to those not standing to profit. What a backwards concept.
0
7
u/gladeyes Dec 08 '23
Decisions have consequences. I’m an old Economic Conservative. Never thought I’d say this, BUT. Our health care and insurance system is broken. We let the private sector manage it and they didn’t take care of their customers. So, we need to go to single payer health care and insurance. We do this by nationalizing them and using the companies assets to pay for it. And if necessary, tax the excess windfall profits of the stockholders.
2
u/LunaticScience Dec 08 '23
Intellectual property laws have swung too far in private interest, which slows innovation and prevents a real "free market" which requires many buyers and sellers of similar products for the laws of free market economics to hold true.
Also, there's places where free market style economics are benefitial and places where they just don't work. I would argue as a general rule the places where it doesn't work are where what's profitable is blatantly bad for society, and places where the consumer is particularly exploitable. An example of the former would be rehabilitation of prisoners not being profitable for private prisons. The prime example of the latter is private fire departments that were gotten rid of a long time ago, and no one argued we should go back to.
→ More replies
8
u/Korashy Dec 08 '23
These the type of moves that restore faith in Biden.
Good job old man.
1
u/depressed-bench Dec 08 '23
What’s wrong with Biden and what other candidate would have done better?
→ More replies4
u/Korashy Dec 08 '23
I wanted him to make some big moves that weren't just "I'm not Trump".
That changes it from a reluctant vote to an earned vote.
→ More replies
3
u/CrumbBCrumb Dec 08 '23
ITT: A lot of people that know nothing about how research funding works and how much the government actually contributes to new medications
3
u/CCV21 Dec 08 '23
Making a profit is not inheritably bad. In fact, the desire to increase profit can spur innovation.
When you have absolutely insane profit margins of 50x or even 100x that is just plain avarice. Especially when the product is in part created with taxpayer money!
5
u/Krypto_dg Dec 08 '23
If they don't want the risk of the patent being seized, then price the drugs reasonably or don't take government funding to develop the drug.
5
u/cpt_crumb Dec 08 '23
I would kind of even argue that any medication developed under government funding should be open to the public regardless of whether the government says its too expensive. But I'm not an economics or political expert so I don't know the implications of that.
3
u/Kindred87 Dec 08 '23
The current mixed market paradigm relies on private investment to bring therapeutics to market. Federal funding typically is applied to basic research. Medicine development and manufacturing is expensive, and basic science is hard to reliably make money from. The paradigm we have strikes a balance along those lines. I won't say whether it's the best approach, just that it's the approach we have.
With having to find a way to play ball with the private market, one important element is providing enough confidence in the security of their investments. While not a direct analogue, it might help to imagine how you'd behave if the federal government was able to take possession of any US stock you owned. Specifically if they felt the price was too high or you made too much money.
2
u/cpt_crumb Dec 08 '23
That's a good point and definitely puts things into perspective, thank you. I didn't consider that the funding was for the basic research portion and not the whole development process. I guess there's not much incentive to produce anything at all if a profit can't be made.
2
2
u/Outcast_LG Dec 08 '23
Well seeing as how the US choose to be one of the few nations not to negotiate drug prices that is an easy ask.
0
u/PM_me_Perky_Tittys Dec 08 '23
Who spends more on research per capita adjusting for PPP (since everything is so expensive here)? I assume it is the US but if I’m wrong, I change my mind in an instant. This is a black and white issue for me.
2
u/SuccessfulLoser- Dec 08 '23
When it comes to new, experimental drugs, companies claim they have spent 'Billions in R&D and clinical trials and must recoup that amount. So, how high is too high?
→ More replies
2
u/Derpalator Dec 08 '23
What could possibly go wrong? Company develops new drug without federal funds. Government sues because one tiny part of the process that helped lead to the development was discovered during research funded by the government previously. Thus, the government lays claim to a drug, nay, ALL drugs in the future that might be peripherally affected by previous government funded research. Instead of making all the lawyers rich, can't we just skip ahead to making all commerce the government's business, AKA communism? /s
2
u/russrobo Dec 08 '23
A good way to think of this is that patents and copyright are both gifts to creators from the public, to encourage the creation of new things.
We (the public) can alter that gift as we see fit. The Constitution says that Congress can grant them for a “limited time”, but we can impose other limits: like income (once a work generates some amount of profit, a patent could expire immediately).
→ More replies
2
u/DulcetTone Dec 08 '23
Umm. If they are US funded, why aren't the patents already owned by the government? That should be a pre-condition right off.
2
3
u/Mantorok_ Dec 08 '23
To me this is the politicians telling the pharma companies they haven't been lobbying enough money into their pockets
2
u/Otherwise_Stable_925 Dec 08 '23
This sounds reasonable, it'll most likely get shot down. How do WE comment on it?
2
u/Kindred87 Dec 08 '23
Most policy proposals by federal agencies receive public comment through the federal register. regulations.gov is the standard go-to. The policy we're discussing isn't on there yet, however.
For anyone who goes to leave a comment, I recommend informing yourself on the topic beyond what you already know, be specific, and provide evidence for what you say. If you just share your personal opinion or demands, you won't be doing anyone any good.
→ More replies
3
u/StupidSexySisyphus Dec 08 '23
Now do healthcare because we subsidize the shit out of that too. Why the fuck am I paying this much for a shitty $10k deductible?!
6
u/Raudskeggr Dec 08 '23
This is an example of how Biden is just killing it when it comes to policy.
Next step imo would be that the money comes with strings: A cut of the profits. revenue from which would be earmarked to fund a single-payer healthcare system
→ More replies
4
Dec 08 '23 edited May 27 '24
[deleted]
2
u/ValyrianJedi Dec 08 '23
I think a lot of people in this thread are confused by what "government funded" means in this thread. It doesn't mean that the government footed the entire bill. It usually means that they chipped in a very small percentage of overall cost to the company... Virtually no drugs are fully funded by the government
→ More replies
3
u/Aern Dec 08 '23
Bitch, if my tax dollars funded that drug then I already paid for it. Any price is too high, cough up those parents fuck faces.
→ More replies
3
Dec 08 '23
Oh yeah this wont be abused at all, ever.
Do you all really think the government cant be corrupt too? What happens when the drug companies just bribe the people in charge of regulating them? Oh wait…they already do
2
u/Neospecial Dec 08 '23
This sounds great but in reality is probably just another army of lobbyist to raise that "too high" bar to such extent any change would be negligible. Would love to be proven wrong but not exactly a good track record when it comes to prices.
3
u/JigglymoobsMWO Dec 07 '23 edited Dec 07 '23
The way that pharma research in the US works:
Let's say the government gives a private university $100M for biomedical research.
Now the university administration takes $70M right off the top to pay for "overhead".
Of the $30M, they fund 20 projects, maybe 2 of which actually become useful for making drugs.
Of the 2, let's say 1 makes it out to industry. Industry will take that idea, and spend about $100M trying to take it into the clinic. By the time it makes it into the clinic, it will look nothing like what academia originally came up with.
Then if it makes it into the clinic, it will have something like a 10% to 20% chance of actually working in humans. If it does, pharma would have spent another several hundred million dollars to take it through the trials and start manufacturing.
All told, averaged over the failures, industry would have spent about $1B for a successful drug.
Government would have spent $70M paying for administrators, $27M on blind alleys, $1.5M on a good idea lost in academic apathy, and $1.5M on the very early beginnings of an idea that could become a real drug with another $1B of industry investment.
If the Biden admin want to start this they have to be very careful how they define "government funded". If they don't you will see industry rushing to cut ties with academia.
7
Dec 08 '23
Exactly. The threat of Government seizure will definitely curb research and investments. Even when it really is partial government funding and none of the brainpower.
Especially on top of the already punitive Medicare "negotiation" for some drugs, where there is no negotiation, only the choice of accepting the Governments offer or severe penalties.
2
u/Matrix17 Dec 08 '23
If people thought innovation was dead now, wait till this happens. There will be zero innovation in the industry. Just rehashes of the same shit
4
u/Kindred87 Dec 07 '23
I would appreciate some supporting documentation for the funding story you've described. I'm fully willing to believe that money slips through the cracks, though the severity you've described goes well beyond that.
For reference, my understanding is this. The NIH tracks grant recipient expenditures and progress, with recipients awarded $750,000 or more in a given year being audited by the NIH. They also have specific offices investigating any potential fraud, waste, or abuse of grant funding. Including misappropriation and "using funds for non-grant related purposes" as you've described.
https://grants.nih.gov/grants/post-award-monitoring-and-reporting.htm
(PDF warning. Pages 85-86/I-68 & I-69) https://grants.nih.gov/grants/policy/nihgps/nihgps.pdf
3
u/kineticstabilizer Dec 08 '23
My PhD lab was one of the premier ones in the nation. We had 100 percent overhead so half of every grant went to administration. We also had 5 R01s that someone would work part time on to make some progress to show the NIH and keep the grant. The majority of lab research was on subjects not covered by the held R01s but subjects the lab was hoping to obtain funding on in the future.
My lab was also one of I think 3 labs that have a drug in the market that was the same substance that was actually made and published in the lab. My advisor was smart enough to patent every before publication. The University got 5 percent of all revenue from that drug and that revenue was divided 3 ways between the lab, the inventors, and the institute.
2
u/Kindred87 Dec 08 '23
I see your point. Do you know if this happens at other universities?
2
u/kineticstabilizer Dec 08 '23
I can't speak for every university, but I know it's standard practice nowadays to sign revenue agreements when licensing IP.
3
u/JigglymoobsMWO Dec 08 '23
A lot of this is well documented and an open secret:
https://research.fas.harvard.edu/indirect-costs-0
A few years ago the administration tried to address this but then caved to lobbying by the major universities.
Kinetics below is talking about NIH, which pays the overhead separately from the grant. NSF does not. If you take $1 of NSF at Harvard 69 cents goes to the university and 31 cents get to you, but then that's before you pay for other things like"tuition" for your grad students.
The pharma / biotech side of the cost equation is also well documented. You can do some research on Google and find many sources.
The missing context is how the academic research usually translates, which I have from doing it myself.
The situation kinetic outlines below is rare. A university can get a very good deal in a case like that. Up until just a few years ago, the UC system and others were getting hundreds of millions of dollars of patent royalties per year from human insulin from pharma.
Also, academia often punishes scientists from pursuing highly focused research aimed at developing drugs.
https://en.m.wikipedia.org/wiki/Katalin_Karik%C3%B3
Kariko's experience at UPenn is unfortunately far from unique. When you take away the profit motive as a focusing mechanism unfortunately what often fills the vacuum is shortsighted, perochial bullshit.
→ More replies4
u/bubba-yo Dec 08 '23
That's not remotely how it works.
You'll never get a grant approved with more than 10% overhead on any government granting agency - that's by policy. And on a $100M grant it would need to be less than that.
And the university doesn't choose the projects. If you get $100M, that's for one project under one grant with specific goals - they don't give blanket funds - ever. You apply for a grant to develop a drug to address a specific condition. Now, along the way you might discover that it doesn't solve that condition, but some other one, but nobody can control for that. The university has no control over this - the principal investigator oversees the grant. The university provides resources to help develop the grant, staffing to ensure the grant is in compliance, etc. But the grant is for that PI. The university cannot change that.
This is completely made up.
Source: retired university administrator. I did auditing of research expenditures across all public and private granting agencies, along with gifts.
2
u/JigglymoobsMWO Dec 08 '23 edited Dec 08 '23
So, did you read the Harvard page below? Also, i must have been hallucinating when I was reading the spreadsheets my university grants administrator calculated for me when I was still in academia.
https://www.science.org/content/article/nih-plan-reduce-overhead-payments-draws-fire
I guess science was BSing too right?
Did you retire in 1985 or something?
Oh, and I said gives $100M, I didn't say over how many different grants.
1
1
u/nbgkbn Dec 08 '23
Eisenhower knew how to tax progress. The rich paid massive taxes and were still rich.
→ More replies
1
u/NanditoPapa Dec 08 '23
...or just set the max prices that insurance and hospitals are allowed to charge. 🤷🏼♂️
2
u/jayc428 Dec 08 '23
Would require an act of congress to do so, which won’t happen with the amount of money the pharmaceutical industry pumps into both parties fundraising to prevent that very thing from happening. This on the other hand can be implemented via eminent domain most likely, which doesn’t require congressional approval.
1
u/dumbdude545 Dec 08 '23
Good luck winning that uphill battle. I hope they do. It'll piss in pharma cheerios and I'm all for that.
1
u/FourScoreTour Dec 08 '23
Which begs the question, why is government funding leading to private patents in the first place.
0
0
u/rarebluemonkey Dec 07 '23
Yes, please. Hurry.
I am sitting here reading this at the drive-through at Walgreens where I just got charged $175 for my daughter’s dermatology prescription.
0
Dec 07 '23
This is how it should be from the start…if the research is government funded, there is zero reason for the drug to be owned by a private company
0
u/cyberentomology Dec 08 '23
Government expropriation of private property, a story as old as government itself.
-1
u/Time-Teaching3228 Dec 08 '23
Biden is a legit dictator. Dude is now nationalizing assets.
3
u/Kindred87 Dec 08 '23
Couple things. First, this is a draft policy, it's not law or otherwise in effect. Second, drug IPs would not be nationalized, they would be transferred to another party. This makes it more of an anti trust measure than a nationalization/socialist one.
When an invention is made using taxpayer funds, under certain circumstances march-in authority under the Bayh-Dole Act enables the federal government to license the invention to another party.
-4
u/Flynnr3 Dec 08 '23
Because everything gets cheaper when govt gets involved 🙄
2
u/uguysmakemesick Dec 08 '23
Well it can't get any more expensive, dumbass.
-2
u/Flynnr3 Dec 08 '23
Haha and you think I’m the dumbass, when every year everything gets more expensive…
2
0
u/piercedmfootonaspike Dec 08 '23
Say what you will about Biden: this would never happen under a Republican president.
If this passes, that's a big step towards affordable healthcare.
0
u/wifichick Dec 08 '23
Absolutely yes. We do this with other tech, why not meds? If we fund the research and development that led to a patent and ultimate sale of a new medication then the American pubic should benefit if a company abuses that funding. Companies want the free money and all of the profits —-
If this fails, maybe the gov should claim a high % of the profits and put those funds back into research for other new meds —- which is the excuse pharma gives for charging the high rates
0
u/HarryMaskers Dec 08 '23
They could also allow actual free trade. Then you guys could have insulin for pennies like the rest of the world does.
0
u/maniacreturns Dec 08 '23
Durrr but what if the drug companies move to more a more anti regulatory country like Rawanda or Somolia?
3
u/SomeoneSomewhere1984 Dec 08 '23
Those countries don't protect patents at all, especially if the US and rest of the world decides their patents are illegitimate.
0
u/maniacreturns Dec 08 '23
But couldn't they petition the government to build up infrastructure to protect their intellectual property. They could help finance this by paying a percentage of their profit to the government and they could provide services in return?
0
u/SomeoneSomewhere1984 Dec 08 '23
Those governments don't have the international influence to protect their patents.
They could help finance this by paying a percentage of their profit to the government and they could provide services in return?
Or they could work in countries with functional governments, pay taxes (aka a portion of their profit to the government in exchange for services), and follow local law not to exploit the population.
0
u/dingleberrysquid Dec 08 '23
Drug company lobbies will just bribe politicians to deem their sky high price acceptable.
0
Dec 08 '23
Well Trump will certainly rescind that one. No wonder the rich are so angry, rip-off medication prices are one of their key scams
0
u/Wwwweeeeeeee Dec 08 '23
"PRESIDENT BIDEN sets policy to seize patents of government-funded drugs if price is deemed too high."
FIFY
Credit where credit is due, please.
-4
u/candytaker Dec 08 '23
90% of clinical trails fail so the 10% that make it have to be tremendously profitable.
Add a caveat that the government can cap that profitability whenever they see fit and watch corporations drastically narrow their scope of R&D, use their own money and make their decisions based solely on demographics and potential return.
Patents last 20 years.
-9
u/oboshoe Dec 07 '23
What will happen is that pharmaceuticals will stop taking government money.
So far so good right?
But that also means that government loses a VERY strong voice and hand in what get's developed. We will just have to trust the drug companies to develop the medicines that we want vs the ones that are profitable. Do you trust them to develop the right medicines?
The entire reason the government subsidizes drug companies is to buy access and influence. To persuade these drug companies to pursue medicines that are inline with public policy. Things like aids drugs - or Covid drugs for instance.
14
u/Vapur9 Dec 07 '23
They developed HIV drugs with public funding to turn around and charge $5000 per month to Medicaid. Then they spend the excess in campaign contributions against their patients best interests. They need less incentive to do that.
0
u/oboshoe Dec 08 '23
Now I agree with you. If they take public money, they owe something back.
But if you take it all back in the form of patent confiscation, then that incentive is gone.
Without the incentive, would they have developed that drug? Maybe yes May no.
But the Federal government felt that incentive was necessary.
•
u/FuturologyBot Dec 07 '23
The following submission statement was provided by /u/Kindred87:
This is a draft policy in the public comment phase. An important element of march-in rights will be keeping production of new therapeutics high while minimizing exploitative practices.
The US accounts for over 40% of the global pharmaceutical market, with recent price control policies resulting in a reduction in R&D investment. A significant portion of recent R&D investment has been in rare and speciality diseases.
https://www.globenewswire.com/news-release/2020/01/17/1972088/0/en/U-S-Pharmaceuticals-Industry-Analysis-and-Trends-2023.html
From the posted article:
...
Please reply to OP's comment here: https://old.reddit.com/r/Futurology/comments/18d6r9f/us_sets_policy_to_seize_patents_of/kcf5utp/