Salocin

There is of course another solution... pharmaceutical research could be funded by governments and not profit making entities.

I don't believe that's workable - the amount of money poured annually into drugs research is truly staggering, even on a governmental level. The only source of funds deep enough to finance this sort of effort is the free market, and the free market demands a return.

PhRMA - an American association of Pharmaceutical companies, measured the 2004 investment in biotechnology and pharmaceutical research at $38.8 billion (for it's members alone), that was up 12.6% on the year before. I can't see governments footing that bill or keeping pace with that growth, especially since the vast majority of such research goes into testing candidate molecules where of every 10,000 compounds that pass the drug discovery hurdle, only one will ever make it to FDA testing.

Also, given that these investments usually have to occur over more years than the term of a typical western government, I don't see pharmaceutical research dovetailing very nicely with domestic politics!

From the PhRMA website : Only one of every 10,000 potential medicines investigated by America's research-based pharmaceutical companies makes it through the research and development pipeline and is approved for patient use by the United States Food and Drug Administration. Winning approval, on average, takes 15 years of research and development and costs over $800 million dollars.

The UK defence budget is a little over £30bn a year and requires commitments that extend beyond the life of a parliament or government. The American defence budget is around 20 times that.

Quite clearly, there ARE sources of funds other than profit-motivated "Big pharma".

Frankly, profit-maximising privately owned companies are the last people I would choose to make ethical decisions of global importance about medical research.

"Personally, if I had AIDS, I'd want drugs later as well as now, and I'd want drugs that worked."

Fortunately, you can afford them. Indeed as long as you live in the West, drug companies will continue to focus their resources on finding solutions to those problems that you are most likely to be willing to pay for. Bear in mind that it is in their financial interests to develop symptom management medications for chronic conditions (of the kind the west is plagued with) rather than cures for acute conditions which are the more likely cause of death in the third world.

While most of your points are completely accurate, I always take (very strong) exception to the implication that "Big Pharma" (the evil capitalist empire) treats symptoms rather than diseases because that's what is in their financial interests. There has never been an iota of proof of this oft-repeated thesis, and to even hint at it is to attribute some seriously evil intentions to people whose names we don't even know. It smacks of anti-capitalist hysteria, which I know is not your intention, but it does deserve to be refuted as strongly as possible.

I would posit (also without much proof, but I think the point is fairly uncontested), that the UK defense budget is motivated by non-benevolent politics and greed to as great (if not far greater) an extent than the pharma industry. What's more, the immediate political benefits of having a big gun to wield are apparent both in terms of an immediate seat at the table of international politics and the ability to make one's opinion felt unilaterally. A similar political ability does not accrue from government investment in pharmaceutical research and development. The political incentives are not in place for this ever to happen - especially since the country that discovers a new drug loses any national advantage gained by its discovery as soon as anyone gets their hands on a single pill or vial.

Governments face a free-rider problem when it comes to investing in pharmaceutical research - you don't get to keep your discoveries or use them to your advantage - they're a public good because they're so easily copied. To compound the problem, those countries that could fund AIDS research more than they already are face other problems too, such as cancer, obesity and diabetes, which pose a bigger population-decreasing and quality-of-life threat in the near term than the AIDS issue does.

To simply posit that defense has a spending level above Pharma, therefore the argument I made above is irrelevant, is to ignore all the differences between investing in things that kill and make you powerful versus investing in research that may enable you to save people, most of whom won't be the people who paid taxes into the research kitty in the first place.

While governments can and do invest in pharmaceutical research through tax breaks and by encouraging and funding academic institutions and subsidising the education of future pharmaceutical researchers (and in the case of the USA, direct investment in public research also), it is not possible to politically justify ploughing billions into drugs research that may or may not yield results when the same billions can go into the delivery of known cures that save lives. Far better to let investors take a punt and lose their shirts, knowing that the risk was theirs to take.

A really easy and "free" way of getting this research done is to protect the discovery once it is made - with a patent - that way the discoverer gets to make an informed investment decision that takes into account the cost of the research and the risk of discovering nothing of value. To break that patent after the fact is to move the goalposts after the striker has kicked the ball, and to put at risk an investment that was made in good faith, with money taken from a lot of honest people's pension funds.

That also happens to qualify as fairly evil in my book.

When it comes to affording the drugs - Brazil provides all these drugs for free to its citizens. Brazil can afford the drug at pretty much any price Merck wishes to charge. Brazil is making a tradeoff between investing in attack helicopters, territorial army salaries and engines of war, and paying the going price for a drug. Which conveniently brings me back to your point about who is investing how much in their defence budget and how that compares to their investment in healthcare.

I guess it's an easy decision to make when you can take a bright, shiny new gun to the patent rules...

Here's the thing... patent laws protecting innovation look like a fantastic, pure and holy thing as long as you are in the 'have' camp. They ensure financial reward for efforts made and make perfect sense...as long as they are viewed from within the Capitalist System.

They aren't inherently good or bad, its just a matter of perspective. As an alternative perspective, try explaining to an AIDS patient in Brazil that drugs exist that could help them with their condition and that they could be provided relatively cheaply but that it is illegal to do so because that would damage the profits of an American company.

I'm not saying either is 100% right, but neither is either 100% wrong.

I'm not disagreeing that from either point of view the opinions are more or less extreme, given what's at stake for both, but I would argue that without the patent laws, the argument wouldn't occur for an unfortunate reason...

The drug wouldn't exist in the first place, and there would be nothing for the AIDS sufferer in Brazil not to have.

On the plus side, (s)he wouldn't feel left out, because no-one else would have access to the drug either.

My point is this - breaking the patent is a bad thing, because it signals a willingness to do such a thing when it was not essential to do so (there was an offer on the table, which Brazil could have afforded). A willingness by a country to break patent rules and thus alter the investment equation of the pharma company *after* they have committed hundreds of millions to a drug, is a signal for future investment decisions, and undermines the investment argument for research in future drugs.

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On a separate point, I don't understand the point you made above about defense spending, now that I've thought about it some more.

The government pays companies (BAE Systems, for example) a very large amount of money for its defense R&D and associated manufacturing. If the government were to take the same approach with Pharma, it would involve paying Merck the $800 million, plus a margin, to develop the drug in the first place, and Merck would no longer care about patents, since it would have received the return on its investment by virtue of the contract with the government. The government would own the drug patent, and would have subsidised the rest of the world's access to this new drug at the expense of its own taxpayers. I don't understand how you envisage a defence-like government financing of pharma would work in an world where governments don't share the cost/risk of such work across all the countries in the world. Companies do this by virtue of being international and being able to sell the finished product in any country in the world afterwards.

The Economist decided to cover this this week - here's a couple of brief paragraphs from their analysis...

The dispute is more about saving money than saving lives. The government complains that patented drugs account for most of the near-doubling in its spending on anti-retrovirals since 2003. Buying unbranded efavirenz would save $30m this year. That is modest compared with the $475m spent on anti-retrovirals in 2006.

Is it worth it? “No country can progress without investing seriously in science and technology,” Brazil's president, Luiz Inácio Lula da Silva, has declared. Brazil spends just 1% of GDP on research and development. The breaking of Merck's patent shows that “if you do innovation you're running a risk,” says Fernando Reinach of Votorantim Novos Negócios, which finances technology ventures. Merck says it is “re-evaluating” its investment in Brazil, its main base in Latin America.