How Pharmaceutical Patents Make Drugs Expensive

Big thanks to my newest Patron on the Oxytocin level, Daphanne P. If you want to keep these videos unsponsored, sign up for my Patreon at http://www.patreon.com/corporis

I think patents are the wrong approach period. If your goal is to reward inventors for creating complex/expensive treatments that improve health…… do it. Instead of patents, the government could give the company a lump sum once their invention demonstrated value.

What's value? A set of metrics regulatory bodies could use to guide the direction of research aka new developments would fill a need instead of targeting the wealthy and/or desperate. Additionally, money has a time value. If I spend 100 million a year over a decade to bring a product to market, I need to recoup:
1) 1 billion in direct costs
2) 500 million in opportunity costs (7% annualized return if you didnt bother creating something and just invested in the stock market)

That 1.5 billion is also not going to be earned in the first year to market. So the remaining amount not recouped each year continues to compound the 7% loss. Finally, once break even occurs, you still have to earn a profit. Basically what could have been a 2 billion dollar lump sum turns into having to recover ~7 billion customers.

Finally: medical services are fairly inelastic. I could make insulin free tomorrow or make it $1000 per week and demand won't change. You either need it to live or you don't, so price change doesnt change demand aka it can be centrally planned aka the government could produce it themselves and set it at cost.

This would entirely shift profit incentives towards meeting real needs while drastically reducing costs

The freedom to doom which people are denied is mixing abusing deadly substances with alcohol and calling it a psychological curative tincture

Unrelated but you starting the video talking about antidepressants reminds me of how frustrating it is to listen to people preaching about antidepressants and taling meds for mental illnesses. As someone whos struggled with depression for a long time, i'd gladly try anything that works better than antidepressants (dont tell me to just work out and go outside, thats not how depression works) but injavent found anything that helps nearly as much.

Like im not joking, if i wasnt taking antidepressants i probably wouldnt be alive right now.

Medical patents are the only reason we have drugs in the first place. The alternative is literally no medication because no company would ever bother to invest and take on the risk of developing a new drug. The REAL reason drugs are so expensive in the US is government regulation and medicare trying to get its own prices.

I bet them juiced homies were happy af when that arimidex patent expired in 2011 😂

It's actually interesting how the patent debate evolved with rapidly changing circumstances, and in many cases, actors on all sides of the debate had good faith arguments for their positions.

Still, it seems to me that a way to fix all this, at least in the US, would have been either the government reimbursing or compensating companies and universities for the costs of drug discovery and production as opposed to granting patents or the government creating national R&D labs sooner or perhaps a state-owned drug manufacturer with price caps on drugs and total transparency in process.

I don't know of anybody who works for free.

This incomplete. I heard a speech by Dr Byrd who invented the Byrd respirator. His complaint wasn't the patent System, it was the FDA which takes up to 10 years to approve a new product. He stated that there is no way for startups making medical equipment to start because margins are so low. Only new startup drug companies could survive because of the 16000% markup they can charge at the end to recover the expenses.

It’s not just pharma. It’s the system. With all the benefits of capitalism, there exist drawbacks like this naturally because power and money in the rat race can corrupt people running the show. If they don’t do, someone else will do kind of situation.

Surprised not to see Escitalopram as one of the me-too drugs. There's no way a specific chirality is a good enough difference to justify another patent, and it seems likely (to me) that Lundbeck knew the left-handed chirality would be slightly better. I think they just released a slightly less effective drug first then released the slightly better version with a small overlap so they could double the years of profits instead of just releasing escitalopram in the beginning.

Now consider doing a bit on how the lack of IP protection prevents the development of new drugs.