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Comment by rayiner | Hacker News Reader

Daraprim is out of patent. He didn't buy a monopoly right, he just bought a drug that nobody else thought was worth making.

Anyway, the distinction between inventing the drug and buying the patent is an artificial one. If you're going to allow creating monopoly rights--and that you can debate--then making the rights tradable will make the market more efficient.

With drugs in particular, acquisition of promising drug candidates is a major input to the pipeline at the big drug companies. It enables separation of concerns: small startups to develop the drugs and big experienced companies to bring them to market. Creating an artificial distinction between inventors and acquirers precludes that efficient division of labor.

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the FDA grants a de facto monopoly right to anyone bringing a drug that is unpatented but out-of-testing standard to updated fda safety standards, by preventing competitors from advertising.

Genuinely curious... does the world actually work like this? I strongly suspect not.

Yes, it does. For example, the recent Hep-C breakthrough drug was created by Pharmasset, Inc. Pharmasset was founded by the inventors of the drug--two professors at Emory University. It was purchased by Gilead, who commercialized it.

It does. Big pharma constantly acquires research-focused junior companies to input into its pipeline for regulatory approval / commercialization.

I'm curious how you came to have strong suspicions that this kind of thing wouldn't work.

Google buys innovative startups all the time. Why should pharma be different?

I just noticed this attracted some downvotes and comments. I should have been clearer. My curiosity was piqued by this:

> acquisition of promising drug candidates is a major input to the > pipeline at the big drug companies. It enables separation of > concerns: small startups to develop the drugs and big > experienced companies to bring them to market. Creating an > artificial distinction between inventors and acquirers precludes > that efficient division of labor.

I wonder how many small pharma startups are successful. Is this really "effective separation of concerns"? Seems more like standard capitalist market dynamics: allow small-fries to take all the risk -- those that sink disappear; those that succeed might get bought out.

Is this really the best way to drive innovation in pharma? But... that's a discussion about markets.

Also, without researching the history of every drug produced by any major pharma corp, I can't blithely accept whether acquisition of "promising drug candidates" is or is not a "major input" to their pipeline. I'm not denyingwhether this happens, just asking to what degree -- just saying "citation needed" for that particular point.

I'm certainly not denying that some small pharma companies are successful, and that some get bought up by large pharma companies. That wasn't my question, and I should have been clearer.

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