Making AIDS Drugs Affordable With Prizes, Not Patents
from the monopolies-don't-lower-prices dept
One riposte to this criticism is that such high prices are needed in order to pay for costly research, but as Techdirt has noted before, that's just a myth. Another is that even if the system has its problems, there's no other way. But there is. In both the US and EU, the idea of replacing pharma patents with pharma prizes is gaining adherents.
One of the early attempts to do that came from Senator Bernie Sanders. At the time, we were rather sceptical because of the bureaucracy that seemed to be involved in this $80 billion scheme. Now he's back with a slimmed-down version of his idea:
I introduced a bill in the Senate that would test this new approach on drugs developed to treat one disease: HIV/AIDS. The measure (S. 1138) would eliminate legal barriers to generic competition for HIV/AIDS drugs and reward innovation directly, through a $3 billion a year prize fund.Sanders claims the savings would significant: he hopes that the $10 billion US market for AIDS drugs could be supplied at generic prices for between $500 million to $1.5 billion. He also notes other benefits:
The prizes would be funded by the federal government and private health insurers in an amount proportionate to their share of the HIV/AIDs drug market.
It will give larger rewards for drugs that improve healthcare outcomes and smaller or no rewards for duplicative, "me-too" drugs that are medically insignificant. It also would eliminate incentives to engage in wasteful marketing activities. Prize fund rewards will be based on evidence that drugs actually work and work better than alternatives.Those "me-too" drugs and the huge marketing efforts that have to be put behind them to get them used instead of similar products from competitors are further symptoms of the patent system's failure to promote true innovation. The present scheme still leaves the problem of how to decide when drugs work "better than alternatives," and how much to pay for them, but at least the field has been narrowed down, which should make judgements easier.
As with his previous proposal, Sanders' latest bill doesn't stand much chance of being realized in the current political climate. But it's good to hear a US senator framing the issue in terms of patent monopolies and their distorted pricing:
The cost of the prize fund would be considerably less than the cost of buying drugs at monopoly prices.Once people recognize that patents (and copyright) are monopolies, with all the disadvantages and abuses that implies, they might want less of them.
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