Not surprisingly, the recent crisis in global financial markets has been front page news for the past few weeks. The Wall Street Journal and other major publications have noted that the impact of this crisis goes well beyond the stock market.
The Convergence Law Institute posted a number of comments in their blog about the impact of the crisis on the health industry, with a specific focus on biotechnology and innovation:
The Wall Street Journal headlines: “Cash Poor Biotech Firms Cut Research, Seek Aid,” adding that this “is threatening to slow the development of new medicines and cut high-tech jobs in the U.S. and Europe.”
Well, one approach to this problem would be to increase intellectual property rights in the biotech firm’s creations, as recommended in Saving the Goose: Intellectual Property and Follow-On Biologics (Sept. 17, 2008).
A problem with the current emphasis on allowing rapid entry of generics is that we will wind up with a system in which generic copycat drugs would be cheap — if only there were any original inventions to copy. Consumers’ pre-eminent interest is that new drugs be created in the first place.
The International Herald Tribune also says “Broader financial turmoil threatens biotech’s innovation”:
But this crisis comes as other factors were already souring investors on biotechnology. Drug development has become longer and more costly, in part because the Food and Drug Administration has become more demanding. And there is more pressure to cut drug prices.
So far this year, public and private biotechnology companies have raised $5.6 billion . . . . That is only one-third the amount in all of 2007 and likely to be the lowest amount since 2002.
As noted yesterday, it is cold comfort to a patient to contemplate on how cheap a drug would be if only it existed when the non-existence is due to ideologues’ insistence that the price be set too low to justify investment in development.
One definition of an ideologue is someone who thinks it fine that others suffer to maintain the purity of his abstractions about how things ought to be.