It seems like we want for-profit pharmaceutical corporations to act like non-profit institutions. Any idea why non-profit institutions haven't risen in the world of pharmaceuticals?
It's just funding. Not like non-profits are magically unable to have talent, or to achieve results.
No one's giving away billions on a pharma non-profit when they could invest. Even though the result is sometimes similar for the investor.
There has to be some middle ground between the 2 branches of insanity?
And to have funding, you have to attract investors. How to attract investors? By making it quite profitable to invest in the company, i.e. making it profitable for the shareholders.
With enough money, you can do anything big pharma is doing. But how to get that money consistently is another question that have an uncomfortable answer. Plenty of startup and small biotech companies go bankrupt every year. This isn't something you can do in a garage and turn it into a multibillion dollar business like software. Biopharma has too many regulations and rules to follow and it makes the entire field incredibly risky and less likely for a small and unattractive player to succeed, even if they are driven by passion.
If that is what non-profits in Pharma are supposed to be, what is the difference with for profits?
People aren't upset by for-profit grocery stores taking tax dollars in the form of food stamps. They aren't upset by taxpayers giving money to for-profit hospitals to treat poor patients.
The government is paying a For profit company to do something that the government wants.
If the company would do it anyways, then of course I agree that the government shouldn't pay for it.
Not what I would call ‘incredibly profitable’. And they are one of the biggest.
If the goal is to go after 'extremely profitable' companies, maybe we should be looking at tech companies, that are in fact, 'extremely profitable', unlike most pharma companies.
and for the record, I have zero love for pharma companies, or how they operate - but they are not - in general - 'extremely profitable' companies. Far from it.
I thought HN was better, focus on the actual problems and not let every discussion turn into a profit/capitalism = bad debate.
If that sounds too much like socialism for your taste, give rich people the option to buy additional services or restrict the public system to basic medical services and drugs and require private insurance on top for cutting-edge stuff.
Profit is a great thing, but it is not an end to itself. The point of liberal democratic societies is to guarantee basic rights for everyone, while constantly improving the welfare (which is not the same as wealth) of as many people as possible. Capitalism has made great contributions towards that goal, but it also contradicts it in several critical places and thus needs to be regulated where necessary.
One think I think worth mentioning is that there is a significant difference between price controls and purchasing controls. purchasing controls is simply refusing to buy if the price is too high, while price controls is mandating a miniumum or maximum price for X. nearly every successful medical system uses purchasing controls, not price controls.
IMO, one of the main reasons costs are out of control is a lack of purchasing controls.
Pfizer's annual net income has been around $10 Billion continually since 2009: https://www.macrotrends.net/stocks/charts/PFE/pfizer/gross-p...
Annual revenues for that period were mostly between $45 and $60 Billion.
Not sure about you, but that is what I'd call "incredible profitable" on any day of the week.
So what exactly makes it so perniciously awful for pharmaceutical companies to do so?
Apart from that I personally think that excessive profit is reprehensible for any type of business, as someone, somewhere is the sucker on the other end of that equation. Tremendous profits usually come with someone being exploited somewhere along the value chain. For many of the businesses that you have listed this is painfully obvious for anyone who is willing to think about this for even a minute.
They might feel different if foodstamp-bought food was 10x as expensive as regular food, and those with foodstamps were forbidden from buying food for non-foodstamp prices.
Say the development of a drug costs $1 Billion on average and that only every tenth drug gets approval. So you are looking at a $10 Billion cost for every successful drug development. But you can then sell this drug exclusively under current patent laws for about 20 years, worldwide. By that calculation, you'd need to sell 1.000.000 doses of the drug for a price of $500 each every year to break even.
That sounds trivial to achieve given that there are 7 billion people alive and innovative drugs will go for vastly more than that even in strictly regulated markets like many European countries (my son gets a pretty advanced drug that costs about $12.000 (EDIT: yearly) to procure but which is covered by our (national) insurance scheme).
Additionally, a lot of the cost of basic drug research is actually covered by government-financed research, not private investment.
If you are still worried, you could use a prize model, similar to what was done during covid: Identify certain qualities that a new drug should have (i.e. be an effective vaccine against malaria) and guarantee a big enough market (i.e. promise to buy at least 1 Billion doses at $10 each) and you can bet that there'll be plenty of companies trying to get at that money.