Senator Sanders Introduces Medical Innovation Prize Bills
from the alternatives-to-funding-drugs dept
Of course, this isn't the first time Senator Sanders has suggested such a thing. Four years ago, he introduced a similar effort. As we noted at the time, there's almost no chance that this goes anywhere, because it's a plan that's simply too radical and would upset way too many special interests. That said, while I do think that this would definitely be significantly better than what we have now, I'm not at all convinced it's a good plan overall. To make this easy, I'll just repost what I said four years ago:
If the plan actually worked, and created new, more affordable drugs that saved many more lives, you could make a compelling argument that the net benefit to the economy would far outweigh the $80 billion (see Murphy and Topel's research for support on that). However, it's still not going to be easy to get people to buy into it. More importantly, it's not entirely clear how you'd allocate this money fairly. Any system like this where the gov't is giving away money is going to be gamed by the pharma companies in one way or another. It'll be so lucrative that it will be nearly impossible not to have the system gamed -- especially when it's going to involve a bunch of bureaucrats trying to determine the value of a specific drug. Finally, the bill seems to be entirely focused on pharmaceuticals -- which is part of the problem today. With so much healthcare policy focused on pharma, people forget that new technologies may start to make pharmaceuticals obsolete. Then we're left with an $80 billion subsidy for an industry that should be going away. I'm all for the economic incentives that come from innovation prizes, but building a huge mis-targeted gov't bureaucracy around them seems risky. Really, it seems to just be replacing one system of gov't subsidies with a different one, and that hardly seems likely to fix the problems currently facing the healthcare space.Again, this would definitely be better than what we have now, but I think it just replaces one market-distorting government subsidy setup with a different one.