Patents Not Enough Of A Monopoly, According To Biotech Firms

from the say-what? dept

Apparently, a bunch of big biotech firms feel that the patent monopolies they already have over certain drugs aren't enough, and they are demanding Congress enact laws that also stamp out any competition from similar drugs (known, back here in the real world, as competitors). You would think that after centuries of understanding how bad monopolies are for the market that the gov't wouldn't kowtow and simply hand over such things -- but it is. Of course, the biotech firms already have patents, so it's questionable why they also need an additional gov't granted monopoly period to block out "biosimilar" drugs, other than the fact that they don't like competition.

They claim, of course, that they need this exclusivity to recoup their costs in developing the drug. However, the deeper you look at the details, the less true that really is in practice. Much of the really core biotech work is done under gov't grants anyway, and often at research institutes. These private firms pick up the trail later in the game in a lot of cases -- but still get full patent rights. The actual cost of developing these things has been massively overstated, often lumping in marketing costs to R&D. It is true that clinical trials are crazy expensive and a huge burden on biotech and pharma companies, but that's a separate issue. There are numerous proposals about ways to take the clinical trial burden expense away from pharma. Lumping those mandatory gov't induced expenses into basic R&D is misleading. Furthermore, even in the face of competition, time and time and time again, we've seen that the original provider still commands a large and noticeable premium, from which it can easily recoup its costs. This is nothing more than blatant monopoly rents with a Congress too clueless about basic economics to resist.
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Filed Under: biotech, competition, drugs, exclusivity, monopolies, patents, pharma

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  1. icon
    Chronno S. Trigger (profile), 24 Jul 2009 @ 6:52am

    Re: Re: This is a bit misleading

    Reading threw the articles, they don't say anything about removing clinical trials for the similar drugs, in fact one part speaks of increasing them. What the article is about is removing those similar drugs entirely for anywhere between 7-15 years. So now instead of having two or more similar drugs that have both gone threw the FDA trials you now have one original. What will stop companies from charging $200,000 a year for the first 7-15 years instead of the $50,000 they charge now?

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