Disclaimer: I took one semester in economics in college, I am by no stretch of the imagination an authority on such a topic. I welcome criticism in the comments.
I have always defended pharmaceutical companies with regard to the patent protection they enjoy. As someone who has done research in molecular biology, I have had a glimpse at how expensive it is to carry out the type of work that leads to the discovery of a drug. My research project was really a drop in the bucket of research knowledge; small potatoes so to speak. I once paid over $700 for 10 micro liters of reagent… that particular reagent ended up not working out by the way.
If you “scale up” the size of a research operation to the size of a pharmaceutical company, imagine how much money and time goes into coming up with a drug candidate. Now imagine that it didn’t work out the way you had hoped… bummer. I only wasted $700 on my puny research project. A pharmaceutical company may find out several years in that they’ve wasted several million dollars. If they intend to keep the lights on, they need to make that money back. They also need to make the money back that they put into developing drugs that actually go to market.
Like any other business, pharmaceutical companies give us what we want. For example, we wanted a cure for hepatitis C, and we got one. Big pharma brought the power of modern molecular biology to bear on the hepatitis C virus, found its weakness and dealt it a fatal blow. And when a warrior comes home from battle he expects a feast. Rightfully so.
Now before anyone accuses me of working for big pharma (I don’t, I promise), here comes the criticism. It is a fact that Sovaldi (sofosbuvir) is a game changer. It is revolutionary. It is a great victory over a terrible disease. I believe, that it may also be at least a little bit overpriced (insert sarcasm)… but my freshman level economics course tells me that this drug’s manufacturer can command almost any price they choose. It is the only product of its kind, it is incredibly valuable, and therefore people will pay.
I can’t help but feel a terrible sense of injustice here however. They taught me in medical school that hepatitis C can kill people, and the cure is prohibitively expensive for many people who need it. This creates a situation where the haves are cured, and the have-nots are left to accumulate toxins until their bodies’ own metabolic wastes drive them into a coma, and then into the grave. This time, I think big pharma has overstepped their bounds with regard to pricing.
I admit that I am torn on this issue. If we want pharmaceutical companies to put in the money and time to give us revolutionary, breakthrough drugs, we should be prepared to pay the piper. That is only fair. However in this particular situation, my sense of social justice is particularly offended. I have a feeling it won’t be the last time.