Please give us all your money
badscience.net
badscience.net
Let's reduce it to the level of individual decisions.
I have a terminal disease.
"Pharma Joe" invented a recipe for substance S that will cure my disease; there's no known cure for my disease at this time other than substance S.
My options are:
(i) try to negotiate with Joe to get his permission to make a batch of substance S, thereby continuing to live
(ii) use publicly-available information to make a batch of substance S, thereby continuing to live
(iii) not acquiring substance S, thereby resigning myself to die soon
Joe would prefer that I choose (i) or (iii); I prefer options (i) or (ii).
When we can arrive at an agreeable (i) there's not much to talk about; things are only interesting when Joe wants me to pick option (iii) and I want option (ii).
What is Joe's argument for why I ought to pick (iii) instead of (i)? It amounts to:
- sure, you could save your own life by making a batch of S
- but if you do that then I won't keep inventing substances like S, and thus in the future some other person will have a disease for which there is no cure, b/c Joe's retargeted his research to penis pills
- so the right thing to do is to go off in a corner and die (and quietly, please), so that someone else in the future might live
It's not surprising that this is spectacularly unconvincing on two levels:
- Joe's asking someone to choose to die so someone else might benefit at some point in the future; aside the usual aversion to Christ-like self-sacrifice on the part of individuals, it's more than a little cheeky of Joe to insist on my making such an extreme sacrifice for the greater good when Joe himself is unwilling to make a lesser sacrifice (reduced profits) for the greater good (we know he's unwilling to do this b/c we were unable to arrive at a mutually-satisfactory arrangement in (i), like selling at prices the about-to-be deceased can afford)
- it's also unconvincing because the real "future proposition" isn't "I die but Joe invents substance T that cures some other disease saving other people's lives"; it's "Joe invents substance T that could cure some other disease but then some other schmuck is going to be in the same position of being unable to afford it and having this same conversation; my death just kicks the can down the road"
...and thus most international agreements that allow Joe color of law to enforce (iii) for "the greater good (of Joe)" have been agreed to as riders on larger treaties and whatnot, making it unsurprising that impoverished countries with disease epidemics try to wiggle around such terms as much as possible.
It's of course absolutely the case that widespread choice of (ii) does disincentivize further research on drugs targeting problems (ii)-choosing populations opt for; it's not like the people making these decisions don't understand the consequences...they've weighed the pros and cons and decided that the best option (unsurprisingly) is to put their lives ahead of someone else's intellectual property and deal with the fallout as it comes.
Even if you really think you'd put someone else's IP ahead of your life -- which I doubt you would, if it ever came to that -- it's not Joe's place to decide that I ought to die for the greater good.
The extra layers of indirection are essential, because while everyone would agree that it's logical and reasonable for you to prefer buying Jim's product to dying (this being your point), it isn't at all clear that Bob ought to agree with that. Bob is supposed to represent not just your interests, but also interests of all other people in the area. It's conceivable that a lot of them will die much sooner if Joe switches to penis pills, than if Joe didn't and continued to develop life-saving drugs. It's fine for you to decide to put your life first and deal with the fallout as it comes; do you have an argument as to why Bob ought to do the same?
If you're Bob -- the duly-elected representative of the people's republic of west brokistan -- then you've got the following calculation:
- either you let Jim keep turning out off-brand tamiflu and (hypothetically) thereby saving hundred-k to millions of lives ("didn't mess with a good thing")
- or you shut Jim down, then have the fun task of explaining to your constituents that it's really better that they no longer be able to afford those drugs
...at which point either:
- Bob uses an argument like Joe's argument; this isn't going to be convincing to the public @ large b/c:
-- if they were buying Jim's stuff and now they can't the same counter-arguments as in the individual case applies
-- if they weren't buying Jim's stuff they now can't if they need it in the future
-- additionally Bob is taking away local industry and local autonomy so on in favor of foreign interests (which rarely fares well in any country)
...which is awesome for getting reelected; or maybe Bob tries the realpolitik strategy and explains:
- oh sorry I couldn't negotiate a good (i) option which is why we're forced picking between (ii) and (iii)
- oh but also sorry (oh, so very sorry) we can't pick (ii) even though we'd like to b/c doing so risks some terribly nasty trade sanctions that we just can't afford right now
...which is honest but makes Bob look so completely useless I wouldn't like Bob's re-election odds with this approach, either.
So I think given the incentives Bob's likely choices are obvious, assuming he's an elected official of some sort; a more dictatorial head honcho might make a different decision.
Whether someone more free to take a stab at long-term utility maximization ought to let Jim keep operating or not is pretty much a function of trade sanctions and so on first and only after that some calculation about "what amount of drugs will we be able to buy in the future that cover what % of what conditions will be significant in the future"?
Substance S exists because at various times in the past Joe made the decision to do substance S. He made those decisions under the assumption that he'd be compensated. You have the option to use substance S under Joe's terms because he made those decisions.
Think of it this way. What if you'd die if Joe didn't touch you? The reason that Joe's touch can save you is that Joe spent 10 years studying and practicing. (Other folks tried but failed to develop this ability.)
Does Joe owe you his touch?
Your example is both inaccurate in critical details:
- you require me to coerce Joe into coming to touch me
- I only require Joe not prevent me from using my own pharma lab and my own materials to cook up my own batch of S
...which is why I won't even answer your question; it's irrelevant to the situation at hand (changing essential details to get the outcome you want is silly).
You're also treating Joe like he's stupid, which is not very likely if he's inventing substance S (you and I may be idiots; Joe is smart with a capital S); given that Joe's a smart cookie it's a safe assumption that Joe is well aware that he's deciding to spend 10 years developing a new technique that can be easily replicated as soon as he invents it.
He's aware of the possibility for (ii) the entire time we're negotiating (i); failing to arrive at a mutually-agreeable arrangement as per (i) (eg something close to cost-of-manufacture; it's not like I can beat that price myself, right?) is a calculated risk on his part, which doesn't always work out in his favor.
There're obvious consequences for (ii) -- among which is Joe no longer deciding to invent substance T -- but those are consequences one can opt for, in precisely the same way that Joe's inflexibility (unwilling to compromise far enough on (i)) has unwanted consequences for Joe (prompting me to pick option (ii)) that he has opted for.
Which in general is the flipside of the "patent-ignoring nations undercut incentive to innovate, making future drugs unlikely to be invented" argument: pharma companies have been extremely well aware in general of eg the situation in india and more generally the sentiment that if push comes to shove (poverty, epidemic, etc.) the right thing to do is ignore patent and manufacture; in the same way that the consequences of ignoring patents are obvious so too is it obvious that driving too hard a bargain for too long will undermine the ability to drive future bargains at all, b/c sooner or later circumstances change and your not-really customers say "fuck it".
EG: it would've been prudent in the long-term for pharmacompanies to push for a standardized international regime for temporary patent abatement (due to epidemic or poverty, etc.) that (presumbably) would have some sliding scale (dire emergencies and abject poverty == SELL AT COST, less so @ the less extreme) and (for example) some notion of compensatory patent extension (eg an extension for 2 years + 2x the duration of the abatement period); such an arrangement wouldn't be ideal, but by proactively crafting a better-than-today, even-if-not-really-good-enough compromise they could've nipped the larger issue (countries going "rogue") mostly in the bud.
You acknowledge that Joe doesn't owe you his touch on the basis that he isn't required to put out any effort to save you.
My point is that you're distinguishing between effort at different times. You think that should be able to benefit from work that he does before you have a need but not from work that he does after you find yourself in need. That's absurd.
Yes, I know that the mechanism by which Joe withholds his labor is different in the two cases. So what?
The whole "there's no marginal cost" argument is silly. We pay programmers more than ditch diggers even though it's clear that the latter work much harder than the former.
As to the "prudent" argument, pharma companies don't control IP law. The actual argument boils down to "they should have tried to molify righteous thugs". (Yup, I think that taking someone's labor is thuggery.)
Firstly: the notion that there's something absurd in my being able to profit from work some pharma research did in an earlier era is itself absurd; if you really believe that under no circumstance is that warranted, you wind either being against patent expiry at all (b/c why would it suddenly become ok just b/c some years have passed) -- which is a tenable but very minority position -- or you have to concede that there's no general principle against such situations, at which point we can get to arguing details.
That's why it's LOL-worthy; it's already the case that it's totally fine to "profit" from work done earlier without compensating the person who did it, provided that the work was done sufficiently long ago (so as to have fallen out of whatever ip bracket it fell into)...which means the argument-from-principles is just ignorant, and the real argument is "do you consider exigent circumstances to also justify such "profiting" from previously-performed labor in the same way that "the passage of time" justifies the same, or not.
Reasonable people can disagree on the latter topic; arguing that my argument somehow fails because it violates a principle that is also violated by all the world's systems of intellectual property is a position you can take, at the expense of revealing yourself to be holding a position contrary to pretty much all the serious thought on IP in general.
But let's move along. The notion of "withholding his labor" is manifestly silly: he created knowledge, knowledge is not excludable once distributed, so there's no intrinsic ability to "deny" future-time use of already-produced-and-distributed-knowledge...whatever ability Joe has to "deny his labor" in this specific case is a gift from those he would deny it to.
This makes the programmers-versus-ditch-diggers a red herring: programmers get paid what they do because they can deny their labor if they're not paid a satisfactory wage (they stop working, it's that easy); a knowledge-producer can't deny use of already-distributed knowledge in anything like the same way, and depends on the state's willingness to enforce certain rules for what capacity to "deny labor" that way.
Which of course means that yes it is imprudent not to mollify righteous thugs in other nations; those righteous thugs are the means by which a pharma company would be "denying its labor" in that nation, and failing to strike a mutually-agreeable bargain leaves you unlikely to be able to do any denying, at all.
That's reality and that's the scope of options within pharmas operate (and indeed they know this probably better than you and have made their choices, etc.); you are free to dislike it and find it unpleasing -- perhaps curse fate for not evolving a cerebral cortex with a functioning drm system -- but making choices based on the actual nature of reality is probably the only way to make good choices short of luck.
Said knowledge is the result of his labor, just as a ditch is the result of a ditch digger's labor. No one feels entitled to a ditch, yet you feel entitled to knowledge.
And yes, the ditch digger also built on the work of others.
I want people to disclose knowledge, that's why I want them to be able to profit from doing so.
Note that said disclosure is why Joe was able to produce the knowledge to which you feel entitled....
I don't feel entitled to Joe's knowledge; in the hypothetical scenario I already have Joe's knowledge, at which point why yes I do feel "entitled" to make use of said knowledge, unless there's a good reason not to make use of it.
I tell you what: if you can explain to me the concepts of:
- rivalrous and nonrivalrous goods
- excludable and non-excludable goods
...and then either:
- explain how both ditches and knowledge share an identical classification along both of those axes, thereby properly being treated together
- or explain not only that your little theory doesn't recognize distinctions about the above but also why your little theory ignores the distinction
...then I'll walk away from this with the sense that you're someone with a rational outlook that just happens to disagree substantially with mine, and call it a day.
Otherwise I'm going to conclude you've just gotten a lot of ego attached to a self-image as a defender of some moral order or other, which feat you regularly accomplish by throwing totem-words until people quit; they get bored, you feel like a winnar.
It's easy to distinguish knowledge from ditches. The question is whether and when distinguishing various aspects makes sense.
Your latest rant boils down to "here's a set of rules and definitions that leads to the conclusion that I like, so prove me wrong with them or I'll declare victory". Whatever floats your boat.
The fact remains you "have" Joe's knowledge because it was disclosed under certain terms. You seem to think that you're not bound by those terms. That's like agreeing to pay Sam the ditch digger over time and then stiffing him after a couple of payments.
A short reply so as not to strain your reading comprehension:
I've asked you to explain why you hold your premises and you haven't; you just continue reiterating that you hold them, and then point out that if I also held your beliefs I'd be in the wrong.
I get that. If you can't justify your own premises -- why the obvious differences between a ditch and knowledge don't matter -- there's not much more to discuss.
It's also interesting that your response to the fact that it's not the actual beneficiary who is using the knowledge, but a speculator, was to invoke realpolitik.
One problem with that is that the means produce the ends. The other is that the speculator doesn't have the characteristics that you use to justify your conclusion, but your conclusion is unchanged.
The request that you either:
- explain how both ditches and knowledge share an identical classification along both of those axes (excludability and rivalry)
- or explain not only that your little theory doesn't recognize distinctions about the above but also why your little theory ignores the distinction
...was an invitation to stop carping and actually state your premises. You declined, and just huffed that "duh they're different but I don't care".
My underlying moral intuitions as relevant to the specific situation at hand are as follows:
- generally speaking I don't expect real-world moral dilemmas to have parties unambiguously in the right and in the wrong. It is convenient when things work out that way but not to be expected; what is to be expected is that a real-world moral dilemma will have convincing arguments on all sides. Consequently making a moral judgment is not playing "spot the villain!" but, instead, deciding which position has the most merit; that a particular position has the most merit says nothing about the merits (or lack thereof) of the other positions other than that what merit the other positions have is less than the position with the most merit. tl;dr: moral dilemmas involve hard choices.
- generally speaking mortal peril -- the threat of losing one's life -- is a significant circumstance that effects how I judge someone's actions. For example: I think murder is wrong, but killing in self-defense is not wrong; most justice systems of the world recognize this principle, and I think they do so correctly.
- there's nothing magical about contracts that exempts them from the previous point: when one party to a contract can only fulfill that contract at cost of that party's own life, the situation demands heavy scrutiny; expecting someone to place adherence to past agreements above self-preservation fails most common-sense morality tests (and is for example why killing in self-defense is considered differently from murder, and why bank employees aren't usually charged with theft when a bank robber sticks a gun in their face). Just having your life at risk isn't carte-blanche to do anything you want; it's simply a relevant fact that colors how I judge a person's decision to renege on past agreements
- in the specific case of an individual suffering from a terminal illness with a single, patented cure who has tried-and-failed in good faith to negotiate a hardship discount from the patent holder I see nothing morally wrong in the individual using their own materials and knowledge to produce the patented substance thereby saving their own life (risking what consequences may come). This analysis is equal parts general moral principles -- not expecting people to go to their own graves for the general benefit of society -- and the specifics of the situation at hand (ignoring patents: fine; stealing stuff: not so fine)
- (unsurprisingly) I also think that in the case of third-world nations facing national epidemics that a similar moral conclusion obtains: if after a good-faith effort to negotiate a price the nation can afford (where "afford" means "purchase in enough quantities to halt the epidemic / mass suffering / etc") then the nation cannot be faulted for ignoring the patents and self-manufacturing the substances in question (regardless of whether production is nationalized or farmed out to private-sector actors); I don't expect the patent holders to like this -- and I don't think they're wrong to dislike it -- but I also don't see anything wrong with the state's actions in that case. The morality-of-the-state does not immediately follow from the individual situation but I think that it does follow insofar as you view the state as obligated to advance its citizens' aggregate interests. I can understand why one might believe the state would better advance its citizens' aggregate interests by respecting the patent-holder's rights, and have already explained in great detail why I don't take that position.
These are relevant moral intuitions; can you state yours?
It's also interesting that your response to the fact that it's not the actual beneficiary who is using the knowledge, but a speculator, was to invoke realpolitik.
One problem with that is that the means produce the ends. The other is that the speculator doesn't have the characteristics that you use to justify your conclusion, but your conclusion is unchanged.
You've per usual mischaracterized what I said.
Anatoly raised a valid point: the specific scenario I drew up isn't actually an accurate match for the scenario at hand, and explained that the moral calculations would probably come out differently in a situation that more closely resembled the situation on the ground.
Unlike you, he very carefully sketched out his own situation, premises, and conclusions, and pointed out explicitly where our views of the world diverged. He then asked what the moral choice would be for Bob -- whether Bob ought to shut down Jim's off-brand pharma factory or whether Bob ought to let Jim stay in business.
Given such a well-formed approach I felt it warranted a proper reply.
I first explained why as a practical matter if Bob is an elected representative -- and thereby accountable to his constituents in some fashion -- the incentives for Bob almost certainly tip in favor of Bob's letting Jim continue.
One thing I admittedly elided somewhat was the relationship between "Bob's incentives as his constituent's elected representative" and "Bob's moral obligations as his constituent's elected representative"; there are entire fields of political philosophy that try to nail that down and getting dragged into it in this context is pretty much a derail.
Suffice to say that yes: Bob is clearly incentivized to allow Jim to continue operating due to the situation Bob is in -- whether Bob is being moral to do so -- and (unstated but implied) to the extent you think that the moral balance generally tips in favor of saving lives now (at the expense of ignoring some patents) instead of preserving the integrity of the patent system (at the expense of deaths) then Bob is, additionally, morally correct to act on those incentives.
I then pointed out that that analysis only applied if Bob was an elected representative.
The only mention of realpolitik was in one of the explanations for why Bob would be incentivized to allow Jim's explanation to continue; it was in the context of a hypothetical defense he might offer to his constituents after he shut down Jim's factory. The realpolitik-derived explanation Bob could offer was that even though he might personally approve of Jim's operation allowing the operation to continue would jeopardize other trade agreements, with worse consequences than whatever fallout derived from shutting down Jim.
I then explained this was a politically weak explanation, as it made Bob look lame for having agreed to such crappy trade terms to begin with; given that it's a weak explanation that makes Bob look bad he'd be incentivized not to wind up in a situation in which he'd have to proffer that defense.
If what you got from that response was "realpolitik! that's another word I don't like" I give up.
I'm still not sure you understand what I was trying to say; regardless of whether your take on realpolitik is correct or not (and I don't have a dog in that hunt) it's effectively a non-sequitur to the discussion.
EG: If I were saying that I can't make it downtown by 5 o'clock because:
- it's too far to bike in the available time
- my car is in the shop
- and I missed the last train
...your statement would be something like:
- trains have uncomfortable seats
...which may be true or false but doesn't really have much to do with the previous thrust of the conversation, does it?
The relationship between your point (which you've made twice now) on "realpolitik" and the posts of mine that mention "realpolitik" is well-nigh isomorphic to the example I just sketched. If you don't believe this I will be happy to make the analogy more explicit.
As this has now happened twice I can't tell which of the following holds:
(i) you understood the analysis I made of the politician's situation but don't care to comment on it; you'd rather discuss what you think of realpolitik. Given the tangential nature of realpolitik to the point I was making this leaves me confused.
(ii) you didn't really get what I was writing but saw a few words in there you have opinions on and so to continue the conversation offered your opinions on those words independent of any consideration as to the structural role those words played in the point I was making.
This is where we went off the tracks:
Yes, my example is different. I'm using that difference to demonstrate that your argument fails.
From here on out I've been saying:
- (i) your example is sufficiently different from mine that to me it proves nothing about mine (though I'm sure it's an example you know how to "win" arguments with)
- (ii) here's why I consider your example sufficiently different from mine as to no longer be relevant
- (iii) please explain why I'm wrong -- why I ought to consider your example and my example equivalent
...at which point to my eyes the rest of our "conversation" reads as you re-iterating that you prefer your example to mine blah blah blah.
And it's worth noting you can't even summarize my scenario accurately, which gives me little faith in your reading ability:
* You think that should be able to benefit from work that he does before you have a need but not from work that he does after you find yourself in need.*
...is wrong; the work was finished well before I was in need...regardless of whether I die or not he's doing no further work, full stop.
First, in your example, I don't see that "Joe" has a preference for you to die.
You are motivated to live, which boils down to either acquiring medication, or not. Acme pharmaceuticals, however, is not in the business of saving lives -- that's not their motivation. They are in business to make money through pharmaceutical development. They produce a product, and people either choose to use it, or not. All moral judgements aside, they are under absolutely no obligation to provide the drug to anyone.
A report by the Tufts Center for the Study of Drug Development in 2003 found that the mean cost of bringing a new pharmaceutical to market was almost $900 million [1]. Let's hedge a little and guess that the cost of developing and releasing a new AIDS treatment comes in at $1 billion -- they're going to need around a million patients at $800/year just to recover their costs and break even in a reasonable period of time, and that's not counting continued costs of manufacturing, shipping, lawsuits, or further research and development. I think it's rather likely that Gilead totaled up their development and recurring costs, factored in a standard profit margin, guessed at their annual sales and did a bit of market analysis, and arrived at a price that kept them in business.
Regardless of whether it's morally right or wrong, producing cheap knockoffs of expensive pharmaceuticals is not a sustainable business practice -- even if those cheap knockoffs are equally effective and have the same quality controls in place.
The situation only becomes a moral issue if we find that a particular company has developed, and patented, an effective treatment or cure for a particularly nasty disease, and then they have opted to artificially inflate their price. If that's the case, then yes, there is moral justification for producing a black-market version.
In all other cases, if you think -- as I do -- that effective treatments and cures for diseases should be available to people regardless of their economic means, then I would suggest that the various countries involved resolve the situation by simply purchasing (or promising to purchase) large quantities of the drug for their citizens. The pharmaceutical company can stay in business and continue its research on the next medication, people get treated, everybody's happy.
A nation like India could afford such a deal.
Poorer nations could have assistance from the U.N. or humanitarian organizations ... if enough people really believed in making treatment available to everyone.
Regardless, I don't think the situation boils down as simply as you make it sound. To paraphrase your last line, it's not your place to decide that nobody ought to suffer at the expense of companies capable of treating them.
[1]: http://pn.psychiatryonline.org/cgi/content/full/38/15/25
You're somewhat wrong about knockoffs being sustainable -- generally it is sustainable, it just means that a universe of knockoffs isn't going to see new drugs. This means that pharma becomes a low-margin industry, but it's sustainable.
(Exceptions are for things like antibiotics and antivirals, which lose effectiveness over time as the wild population adapts; most other pharma products remain as effective as they ever were.)
Given the economic conditions in the third world -- india being a perfect example -- it's not surprising that india has taken the strategy it's taken; until the crippling disease-riddled poverty is taken care of the smart thing to do is to let the private sector solve the problems it can by taking a soft line on international pharma patents.
India could negotiate bulk purchases of pharma but clearly has decided it's not in its interest to do so; it's a large enough entity to get its own way and has done its own cost-benefit analyses that tip the balance in this favor; perhaps things wouldn't work out if everyone did it but then everyone isn't going to do it, anyways.
As far as Gilead goes: I can assure you that Gilead has hired mckinsey, game-theory phds, and many other eggheads to arrive at a pricing strategy in each legal region by carefully examining:
- expected purchase amount @ each pricepoint
- likelihood of country going rogue @ each pricepoint
...and that prices are set to accommodate Gilead's particular risk preference (where risk == "chance of driving a country to go rogue").
Medicine is the only area that I know of where existence equates to entitlement.
If you have a claim on others, for the funding of your medical treatment as an act of charity, it is a broad claim on society as a whole. When we agree with you, (as when we approve of rent controls and thus make the burden of housing the poor fall narrowly on the owners of rental property) that is due to our hypocrisy: we are glad to dump our collective burden onto a scapegoat.
You are arguing that the obligation to releave the hardships of the poor falls narrowly, landing on the shoulders of those who provide the goods to the poor. Your argument would show that if a cripple is unable to afford a wheel chair, then the wheel chair maker must reach into his own pocket to pay poor relief. Your argument would show that it is the greed of the bricklayer and the roofer that is to blame for homelessness.
But this:
I want a wheelchair but can't afford one from the legitimate supplier. I know how to make one myself and have all the tools and materials at hand. I've made a good-faith attempt to negotiate a hardship discount with the legitimate supplier and have been spurned; failure to get a wheelchair means I'll die soon. In this circumstance I think it is moral to make a wheelchair for myself using my own tools and materials.
Even more precisely, the scenario (with India vs rest of world) is pretty much:
- GSK et al would like India to crack down on offlabel pharma shops
- India clearly prefers letting offlabel pharma companies operate
...and neither on their own can force the other other to stop what they're doing, which is why each party:
- GSK et al
- India (and other countries in similar boats)
...are appealing to the rest of the world for sympathy and support; each of these entities has valid moral claims on their position, so how is one to decide which claim is more justified?
I've argued my position. You're arguing against a different position than I took (or really, drawing false generalizations that I don't hold and then taking me to task for holding those positions, which I only hold in your imagination; if you want to talk to yourself count me out of it).
See: malaria. The existing, cheap, mostly efficacious, patent-unencumbered drugs face permanent lack of supply. Last time I checked exactly one company bothers to make them -- there just isn't any money in it. [Edit: A quick Google suggests my memory is failing me.] Drug-resistant malaria is on the rise, and the drug companies pretty much won't touch malaria drugs with a 30 foot pole. If they make something that works, it will be promptly stolen under the color of law.
Or they could pump a few hundred million into another promising drug which will be overprescribed to rich Americans, and make billions. Hmm. Decisions, decisions.
I don't think drug companies are going to stop researching drugs that will make them money in rich countries.
First is by passing patent laws. The attractive property here is that the government is not paying out on research that fails. Private business does that and has to suck up the losses. The other side of this coin is the big "windfall" from monopoly profits when the research succeeds. What seems like a shrewd incentive scheme ex ante, seems immoral ex post.
The second way is by funding research in national laboratories out of general taxation. The problem is that the government keeps paying for research that fails, and since success is rare the process is hard to manage. At what point does the government admit that a research institution has lost its focus and should be closed?
This second way raises awkward questions. Having worked in government funded research myself I'm painfully aware of how easy it is to persuade one-self of the merits of long term research over short term research to the extent that one wanders off into the wilderness and never achieves anything. The profit motive is one way of countering this tendency. Are there other ways? They need to work better than the profit motive, but that is setting the bar pretty low.
I think Ben Goldacre could better spend his time talking about the psychology of being a researcher. The second route is seen by many as a money-pit, but there is much new thinking on Public Choice Theory and Mechanism Design. Are we not ripe for some new and better ways of running publicly funded research? If we never get round to thinking about these issues, then the mocking title of "Please give us all your money" also works well as an attack on publicly funded science.
An idea is that drug X does well in vitro under certain conditions. Real change is a development, certification, marketing, sales, and accounting system that lets drug X actually help people. Ideas are cheap. Execution is tough. I might have a drug that cures cancer, but if I can't prove it, if I can't get funding, if I can't get certification, if I can make the drug, warehouse it, distribute it, etc -- it's just an idea.
This is why the argument does not work against general science. General science is all about ideas -- that's all there is. Making drugs is about delivering solutions to people.
They're two different things.
It sounds like you are talking about illustrates the dichotomy of fundamental versus applied research. In articles and discussions I read and hear on research and funding, I see a general lack of acknowledgment that we have different research models. Different research models pose different incentives.
To oversimplify and generalize a lot here, I'll describe my understanding of one model, The fundamental to applied research chain,
Fundamental research is discovery, to evolve vague notions into concrete ideas and data. It is a broad, generally undirected investigation into some phenomena.
Applied research, on the other hand, takes the concrete ideas and data (knowledge) gained from fundamental research and turn them into tangible products (physical such as medicine and virtual, such as search engines).
With fundamental research, we get ideas, but not products.
With applied research, we get products from ideas.
Without fundamental research, there can be no applied research.
Without applied research, we get no products.
Yes, that is a broad generalization and disregards the true overlap of different research techniques, but I think breaking things out like this can help discover better models and financial motivations for research.
To me, it seems that the public sector is more naturally suited toward fundamental research and the private sector is more naturally suited to applied research.
First is by passing patent laws.
The second way is by funding research in national laboratories."
What if the government laboratories did their research under the direction of private business? This would reduce the risk of govt labs wandering into the wilderness, offload some of the risk from business, and could provide society with a stake and return in the outcome, expressed in lower prices or wider manufacturing rights or whatever.
How about not?
If you're worried about dumb spending by govt, this won't solve it.
If the likely value is too low for a company that would get all of the benefit, it's certainly too low for a govt that gets less of the benefit.
What does that tell us? It tells us that the only reason big pharma even bothers to fight for their patent is because they are legally forced to do so; if some idiot in the US can make a case that they're not defending their market, they might have it taken away.
They don't care about poor people healing themselves; they care about relatively rich people in the US buying generic drugs because they're cheaper, even though US society can afford to pay for it.
Drug companies aren't monsters, they're corporations - machines for making money, pure and simple. They're just doing what's required of them.
Change the patent laws - and the diplomatic pressures of the US State Department - to allow third-world companies to sell generic drugs to people in third-world countries, and not people in first-world countries, and bam! Problem solved.
Mandate lower drug prices in some other way and say goodbye to future new drugs.
Or find new, different, better ways to promote and reward invention and say hello to lots more future drugs.
Patents are broken, even if you agree with them in principle. See software patents for an area where they are broken beyond repair. Medical patents distort the market a great deal. See the comments on the original article for various dubious schemes that only make sense under the current patent regime.
Seems to me like a fair deal -- if the time limit is truly ten years, if the people who are the market are the same people who will benefit at the end of the period, and if patents are not overly-broad.
That's a lot of ifs, but it works in the U.S. The problem is that the market in the U.S. is nowhere indicative of the market in the third world, yet the drug companies want the same trade-off to apply everywhere. To this author's point, that doesn't seem to work so well.
Having said that, the answer isn't so easy either. Once you start using government force (or ignoring compliance) to appropriate other people's IP, the incentive goes away.
Of course you can argue that there are other incentives: altruism, government mandates, public-funded research. But all of those things haven't proven to be very effective, no matter how much hand-waving or yelling the supporters do.
This is not an easy problem.