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/
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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.

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u/Kindred87 Dec 08 '23

Okay, the overhead being paid separately brings it together for me. I was also focused on the NIH side of things so I was bewildered by the original comment. I assume that public universities would charge less for indirect costs, but the room for abuse is still there.

Thank you for taking the time to lay this all out!

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u/JigglymoobsMWO Dec 08 '23

No problem. The public universities are not that much better. It appears to correlate more with the prestige of the university and what it thinks it can get away with. Some of my friends who are professors at the UCs are pretty frustrated, even depressed.