Goldman Sachs asks: 'Is curing patients a sustainable business model?'

If a company succeeds in eliminating or reducing a major illness (and its related family of illnesses) from world wide population then they should be rewarded with a one time cash bonus of what that illness could have cost the governments around the world for the next decade or so. Or some sort of formula like that.

One time incentives are always super attractive for employees and staff, although not so much for investors.

Market forces suck at valuing life.

Each country has to decide whether to shoulder the responsiblity of citizen health, or leave it to the market.

What if nations funded research and drug production in nation owned facilities that priced the drugs at production price to national insurances and at higher prices for world wide sale? The high costs of research in medicine should be canceled out by the reduction in insurance spending (which no instead would directly be used for research). Given that nowadays drug companies are profitable their spending and earnings must be balanced, so would it would be in such a system as well. The price for drugs can only go down this way. It would not even be necessary to get rid of commercial drug companies and the standing patents. It would just be an addition for the creation of drugs that do not need to rely on a business model but that are focused on actually make people healthy as cheaply as possible.

Key factor in a farms pitch deck I wrote years ago: this indication recurs, so patients who catch the disease will need subsequent treatment, but due to how it happens this doesn’t qualify as a chronic condition. (Which would have made the trials much more expensive).

There’s a bit of kabuki in pharma pitches: on one hand you have to talk about how you care about patient suffering, on the other hand you need to cosmetically sugar coat yet emphasize the revenue model, which is what people really care about.

(Oh and the best pitch decks always have gory pictures in them)

I do believe that in biotech, you need to truly be motivated by improving lives. It seemed to me that this article mentioned a few strategies that the GS report advised for to sustain revenue growth that could also tie in to making useful biotech products (e.g. finding a market that has a disease with high incidence). That being said, this post title seems to be a tad bit sensationalized. Certainly an investment bank of this ilk would advise towards making profitable investments. My experience has been many people who work in the biotech industry(albeit scientists,engineers, etc) want to help people. Obviously, no company is going to function like a charity but perhaps not all companies are created equally?(when comparing a financial services firm with a biotech company). What I said is not a very nuanced look I suppose, as biotech companies can do things like develop IP from publically funded research and often do things that can be anti-consumer interests.

Governments set the rules of markets... How could governments adjust the rules so that developing cures makes business sense again?

For fucks sake - it's Goldman Sachs people. When the market was going tits up in 2007/8 they royally shafted all of their own clients. If don't accept the stance that the whole operation is toxic then bye bye dinosaur. (But if you have a shit tonne of cash I recommend them). (added note: I'm pure British (born in Zambia) any sarcasm is intentional and probably just for effect)

What about governments create a "bug bounty" program for diseases? Every year, the bounties for common diseases would increase, and if a firm finds a cure, it must accept the bounty and gives the cure to the human society, free of royalty

Yeah but the ethical backlash against being able to cure but not curing will be immense

That's why subscription drugs - pardon, prescription drugs- are so profitable

Says Goldman Sachs the money men. Even if there's a prevention model, anomalies are inevitable and what if anomalies are frequent would simply just let those people die because of your profits?

think of all the diseases caused by externalities

Is capitalism a sustainable life model?

Why not? New patients are born every day.

Part of this is because the vitriol poured out on Gilead over pricing. The cure had actually much cheaper lifetime costs than the treatment, but because the cost was upfront people complained. How much a society is willing to pay for stuff is a real indication of what it actually values. Society has shown that it does not value cures over treatments. You get what you pay for.