Drug companies have a portfolio of compounds they research. Most don’t pay off, so R&D costs make their way into the pricing of those superstar and other drugs that do work. Also, timelines are pretty long.
replyDrug companies spend more on marketing than R&D
replySo?
replySo pharmaceutical companies spend far less on marketing outside the US, partly because every other country besides New Zealand makes those incessant drug ads illegal, and partly because governments negotiate prices and keep profit margins down. If the argument is that R&D costs are what make drugs expensive, then we could easily eliminate an even greater expense by just copying what other developed nations do.
replyDon’t you think drug companies would be doing that (not advertise) if it would increase their profit?
replyIn that light, the entire market itself looks essentially artificial, given drug manufacturing couldn’t exist without government guaranteed property rights, which are themselves a kind of monopoly on use.
replyBut yes, the reason brand name drugs are drugs are more expensive than generics is due to intellectual property, both the patent and the trademark.
Without temporary monopolies granted by patents, those prescription medications wouldn’t exist in the first place.
replyUnless we came up with a different funding mechanism. Joseph Stiglitz for example has advocated a prize system for pharmaceuticals, though he doesn't suggest replacing the patent system entirely.
replyhttps://www.project-syndicate.org/commentary/prizes--not-pat...
Salk didn't need that temporary monopoly to invent the polio vaccine, which has gone on to be one of the biggest success stories of vaccines and modern medicine general.
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