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Report Says Patents Prevent New Drugs
An anonymous reader writes "Current orthodoxy claims patents encourage innovation, by allowing developers to enjoy profitable monopolies on their inventions which in turn inspire them to create new inventions. A new report by the non-partisan General Accounting Office suggests that this orthodoxy is wrong — at least when drug companies are involved. According to the report, existing patent law allows drug companies to patent, and make substantial profits off of, "new" drugs which differ little from existing medicines. Given high profit margins on very minor innovations, the report argues that drug companies have little incentive to produce innovative new drugs. In other words, current patent law actually discourages drug companies from producing new medicines.
Responding to the report, Senator Dick Durbin (D-IL) released a strongly worded statement suggesting that a legislative response will be forthcoming. "The findings in this new GAO report," said Senator Durbin, "raise serious questions about the pharmaceutical industry claims that there is a connection between new drug development and the soaring price of drugs already on the market. Most troubling is the notion that pharmaceutical industry profits are coming at the expense of consumers in the form of higher prices and fewer new drugs.""
The headline draws rather a long bow. I think that what's clear from this report is that the current patent system is broken and stifling innovation. However, this does not invalidate the very concept of a patent, which the article summary suggests is the case. "Current orthodoxy claims patents encourage innovation, by allowing developers to enjoy profitable monopolies on their inventions which in turn inspire them to create new inventions" - this is still true. It's the current implementation of the "profitable monopoly" that is causing issues.
If the drug companies can get away with sticking a capital letter on the end of an existing drug while changing its dosage to get a new patent, thats certainly an issue with the patent system. But its only one element in a perfect storm in this case. If consumers weren't so brand horny, and were more cost oriented when buying their drugs then these drugs wouldn't even sell. Few of them offer any signifigant benefit, and I'd argue none have any benefits worth the extra cost. But consumers see that 'D' or some other moniker advertised and assume thats the new one with less side effects that they need to demand from their doctor while asking for antibiotics to treat their viral infections. For health care providers part though, its their job to recommend drugs to their patients...and since a lot of them seem to be getting a kickback from the drug companies, they don't always make the the correct decisions.
My company offers a generous healthcare plan for this day and age. But they ask all of us to do our best to keep costs down. I can't tell you the number of times I requested a generic from my awful dermatologist when I didn't even know one existed, only to find out that it did...and wasn't the automatic first choice! Most people aren't concerned with those costs since the insurance pays for it...but we've seen what that attitude has caused, insurance is more expensive and less people have it.
I personally don't think HSA and the like are the solution. But I can understand why they are being tried. Consumers need to be more proactive about doing their part to keep insurance costs down.
Many of these "newer drugs" are simply older drugs with some manipulation...patented manipulation.
Frankly, I avoid the use of drugs whenever and wherever possible. I find that addressing the cause rather than the symptoms is a better approach -- at least for simple stuff. I'm not a medical professional, but I (and many other slashdotters I have noticed) find that better health can be had by eliminating stuff from the body rather than by adding foreign substances.
People often have some weird ideas when it comes to medicines. TV commercials don't help much when they draw diagrams of something taken in the mouth somehow routing around the digestive tract and directly to the troubled area. The only drugs I can think of off he top of my head that behave that way are topical cremes and ointments and suppositories. Beyond that, people seem to expect often magical properties from "modern medicine." It ain't happening.
From TFA: "the ability of drug manufacturers to easily obtain patents for minor changes to products, or to receive patent exclusivity for new uses of existing products, have reduced incentives to develop new drugs."
Sounds to me like its the ability to get a patent on something that's essentially already out there in the market that is stifling innovation. This sounds a lot, to me at least, like the general distaste for 'junk patents' in the software/computer industry. Perhaps if we start requiring inventions to be unique before we allow patents on them, we'll actually start encouraging bolder, newer ideas again?
...is that profits are much lower for drug products, such as vaccines and antibiotics that are extremely effective and "cure" in a small number of doses, than for drugs products that merely help, or palliate.
The invisible hand of the marketplace skews development toward drugs that must be taken forever, such as blood pressure medication, or cholesterol lowering medication, or anti-depressives and so forth. These drugs are godsends if you need them, but the fact remains that drugs that actually save lives, with a small number of doses, are less profitable than drugs that merely improve or prolong them, and need to be taken continuously and repeatedly forever.
It is this warped incentive that needs to be fixed.
The antibiotics we have are losing effectiveness. Hospital infections are becoming more and more dangerous. My generation is probably going to be the only generation in human history to live its life mostly free of the mortal fear of dying from bacterial infection. There are virtually no new antibiotics in development.
"How to Do Nothing," kids activities, back in print!
The pharmaceutical industry is where the software industry would be if it wasn't for the existence of Open Source. That the closed source companies are pushing for a US style patent regime in Europe and elsewhere is a given. What with patented GM crops we see farmers being sued in the US for reusing GM seeds grown from their own crops. Something practiced for centuries.
It's also difficult to avoid infringing some patent as the GM crops cross-fertilise with plants in the next field. The resultant seed being also covered by the same patent. The GM companies would of course have the farmers buying their seed annually from the companies. What next, produce sterile crops and totally outlaw unlicensed seeds.
As the report says in relation to pharmaceuticals, you can see the same thing in the closed Windows monopoly, little real innovation, "new" software that is differs little from the old and a small number of companies making vast fortunes and lastly it's the consumer that suffers from no real choice.
davecb5620@gmail.com
To reject any application that can't explain in plain english and 2 sentences (120 words) or less why it is unique and deserving of a patent.
Why this criteria? Because if you have to draw comparisons with other items and state that this application improves incrementally over items 1-n, then it's not innovative and not deserving. Take the pet rock for instance (however trivial and droll):
It's a polished rock with googly eyes, marketed as a "pet". There is nothing like it in existance today.
I'm still not sure it should have a patent, but at least you can explain it in 2 sentences or less, including the all important "unlike anything else" clause. (whether that was true or not is a different issue)
As for funding the patent process:
Make patents holders pay a percentage take to the PTO, paid at least yearly, with a minimum fee of the application itself, increasing by some scale over the years. The older they get, the more expensive they get. Failure to pay on time means it becomes public domain.
I believe such an approach solves several issues, while still allowing invidividuals to profit from their work without undue hardships.
The cesspool just got a check and balance.
I say that we should just scrap the whole thing and go back to the days of the traveling snake-oil salesmen. God knows that was much better for consumers.
And while I understand that the urge to deteriorate into meaningless hyperbole is nearly irresistible when writing a two sentence post, let's not lose touch with reality. Every year drugs with amazing complexity are trialled and approved. Say what you want about drug companies, but advances in the pharmaceutical industry are just as--if not more--impressive than in any other industry. Maybe they could be better under different circumstances, but I'm absolutely sure that they could be worse.
The grim truth is that we still only have rudimentary understanding of our own biology. The only reliable way that we've found to test drugs (and drug interactions) is by lots and lots of human trials in graduating size and complexity. How else are you going to know what drug X does when it's mixed with drugs Y & Z on a patient that used to take drugs C, D, and F and once suffered from diseases J and K?
Even now--with this rigorous testing--we find that some drugs should never have been sold. Vioxx comes to mind. These episodes are famous because they're so rare and they shake consumer confidence in the pharma industry. Imagine what it would be like if that were a weekly or monthly occurrence.
You know what the nicest thing about Japanese and German television is compared to American TV? It isn't what you see(TV is pretty dumb the world over), but more of what you don't see. No ads for prescription drugs for starters(no ads for ambulance chasers either, but that is a different story). The reason drug companies patent drugs that vary little from existing drugs is because they can still make money off of them by advertising them both to patients and to doctors. Patients go in and demand the name brand of the drug they saw on TV(which further feeds into the trend of self-diagnosis, but that is another rant) and doctors who are required to get a certain amount of education every few years enroll in drug company sponsored classes. They turn a well meaning law into profit for drug companies.
If we really want to see new drugs AND get cheaper health care, banning advertisements is a good start.
Monstar L
There is really a main part of the patent system. Encouraging innovation is just a side effect. The idea is that without patents there are a few outcomes.
1) Companies would keep their "trade secret" forever, if the person who knew it died in an unfortunate plane accident with the plans in his briefcase there would go the life saving drug.
A Patent gives the company incentive to reveal their secret and at the same time are protected for some time it's an exchange.
2) Competition (such as in the early part of the industrial revolution) would hire employees of said company to steal the trade secret, since there is no legal protection, and it would be very hard to prove this type of theft. The patent system creates a legal system were people file their inventions and are protected from this behavior.
The vast majority of research in drugs or is done at the medical school level, where they have people paying for the privilege of doing research. Pharmaceutical companies are partnered with them to get that research (funded by governments in many countries). It wasn't until the 1990s that collages were allowed to patent research paid for by public money, so in many cases they gave their work to companies that then got the patent on this research paid for by the public.
This has changed and now many universities hold a significant patent portfolio when it comes to drugs and drug research. In addition there are huge government grants to fund research for drugs that will have limited or no ability to make a profit during the life of a patent.
The other major issue is liability, drug companies don't want to be sued, so its better for a big name to create a spin off company that can do the research on very new drugs that way if any issues come up (big lawsuit) then they can fold that company, and then reap the profits with a new warning label.
The bottom line is that its not just patents, its a whole string of problems that exist with the system, and no one who has the ability to change things is really interested in doing anything. If there were no patents, we would quickly see the only drug these companies put out would be safe ones that they are sure will sell allot of.
I sued to be an analyst at a fund managemetnt company. I used to look at pharmas (although I was not a sector specialist).
A few things I noticeded.
1) Lots of patents cover minor improvements of existing drugs.
2) Lots new drugs are similar to existing drugs.
3) Patents are such a wonderfully effective mechanism that regulators (the FDA etc) have to give pharmas additional incentives (such as orphan drug deisgnation) to develop certain drugs.
4) Patents do more to boost marketing expenditure than R & D expenditure.
There is also no real evidence of what effect patents have. We know from academic studies that they have little positive impact on semiconductors or software, as for eveything else, we have no idea.
with deeper and more formal research and testing. we might not have had to wait 100 years to learn that aspirin
(a) is not appropriate for everyone and
(b) that aspirin has other, very significant, medical uses than as a mild painkiller.
in the nineteenth century you could sell anything over-the-counter.
that it was addictive and dangerous didn't matter. that it was more potent than the gin mill's rot-gut whiskey didn't matter. that it promised cures for everything from tuberculosis to cancer didn't matter.
american medicine was quack medicine.
the real, meaningful, advances in pharmaceuticals were coming from abroad.
You also have to consider the fact that the patents are an encouragement to sit on a drug that has already been developed and wait till the patent expires before releasing newer potentially better versions. The newer versions would come out faster and more often if the patent didn't last as long. Either way arguing that INCREASING monopoly powers is a good thing economically is silly.
I can't find a link for it, but I believe that the patent office has already changed it's policies of drug patents to prevent minor changes being repatented as brand new drugs. That still means that the original formula of the drug is no longer under patent.
It is fantastically expensive. But that doesn't mean it wouldn't be done. There are huge rewards to be made when you have the ability to cure someone's disease; people will pay early, often, and lots for treatment, and companies will always rush to fill that gap, patents or no. If the innovating company does its job right, they deploy their product before the competition has a chance to copy the product. And if its not doing the job right, and the competition does copy and undersell the innovating company, then that company will go out of business, to be replaced by companies that can innovate and deploy to everyone quickly and efficiently, which is what we want in the first place. Patents merely reward having inefficient, slow rollouts- and especially reward slow rollouts that deliberately do not meet demand.
A pharmaceutical business climate based on first-to-market will have the added benefit of biasing companies towards developing medicines that are complete cures, and not treatments that take years or decades- the opposite of the current bias. It's currently a far worse business decision to conduct research in extremely aggressive leukemia, versus making the next Viagra. That shouldn't be.
groupthink: It's good for self-esteem.
"a private industry would be faster, better and cheaper."
Well, that's a nice guess but that's about it.
I'm no fan of bureaucracy, but the FDA isn't your average government agency. It's completely independent. And the idea that a "private industry" could constrain time and cost and still produce "better" results is amusing to me.
What, exactly, would you expect to be different? The drug companies run the trials. It's always been that way. All the FDA does is provide oversight, review and approval.
And not to be a prick but it's a little obvious that you under-thought this. How would a "faster" trial period possibly produce "better" results? If you're producing a drug that would be taken for extended periods of time, how would you possibly know what to expect if you don't run long-term trials?
A private enterprise has only one constituency: its shareholders. Sometimes the best interests of shareholders and the public at large align, but not always, and I wouldn't feel comfortable even saying "often." I don't care if your liberal or conservative, there are some things that a government just does better. And this is one.
Those that believe in the magical powers of the free-market to regulate itself need only look at all of human history prior to the last 75 years.
I am so ridiculously tired of hearing this absolute BULLSHIT. I'm a researcher at a pharmaceutical company. Most of the conditions we're trying to make drugs to already have a cure: Put down the cheeseburger, put down the mountain dew, get your fat lazy ass off of the couch and get the fuck outside and walk around a little. There is no cure for a retard eating 4000 calories per day with 15g of saturated fat-- you are going to get type II diabetes and atherosclerosis. That's how your body works. And the way the biochemistry works, THERE IS NO CURE. The systems are working exactly the way they're supposed to. Problem is, they've evolved to store fat during the rare times of plenty, and then dole that out during lean times.
If I could come up w/ a cure, you can bet we would make it. See, we have competitors. Who make a lot of money. If we could make a quick & easy cure, we'd make it, make a ton of cash, and move on. As an example in the last couple of years, Merck made their HPV vaccine to PREVENT cervical cancer. One time, cheap shot, and they've lost a potential cancer patient. Of course, it took forever to get to market because the Republicans think that preventing HPV infection will cause teenage girls to become whores. If you want to look for the reasons our health care system is so fucked up, I suggest that you follow not only the money, but the ideaology.
1984 was supposed to be a warning, not an instruction manual.
What if patents only allowed the bearer to hold the patent as long as it took to cover their R&D costs? So if I come up with a clever idea which I can implement overnight (like one click shopping) I get basically no protection. But if I spend a million dollars working out a flying car or a new cancer drug, I am covered by the patent until I recoup my losses, then it's fair game. It could be "recoup losses + 10% too" or something.
:)
Just thinking out loud