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Goldman Sachs questions whether curing patients is a sustainable business model

arstechnica.com

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Re: Goldman Sachs questions whether curing patients is a sustainable business model

#31

Post by xg15 »

PeterStuer wrote: post #24

The 'ideal' drug from a business point of view not only not cures the patient long term, it offer a short term mitigation while increasing the risk on relapse and thus future recurring consumption of the treatment. At the same time it can be IP protected to block alternatives and has an insured third party collective payment coverage to guard against the treated running out of funds to afford the perpetual dependency…

This. I'd go further and say that a system where innovation is driven by profit is good at perpetually managing problems but very bad at actually getting rid of them.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#32

Post by sjtgraham »

_lbaq wrote: post #2

Thats why "we the people" need to have large part in developing new drugs and the care of people, this is nothing that can be left to the "market" in some hope that it will "work out".

There is nothing to say the market won't solve problems. Innovations like Gilead's are inevitable. A cure might make less money than chronic treatment, but once a cure exists nobody is buying the treatment. It's rational to develop the cure if you want returns.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#33

Post by emiliobumachar »

quincunx wrote: post #3

In this sense gene therapy is "disruptive innovation" in the Clayton M Christensen sense of the word: the incumbents cannot pursue the strategy as doing so eats into their profits. Does it take smaller, independent, outfits to pursue this?

I agree that, if one-shots get to be profitable at all, incumbents cannot smother them for being less profitable than continuous treatment. Somebody else will do it.

The problem is if searching for one-shots gets to be unprofitable altogether.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#34

Post by buvanshak »

PeterStuer wrote: post #24

The 'ideal' drug from a business point of view not only not cures the patient long term, it offer a short term mitigation while increasing the risk on relapse and thus future recurring consumption of the treatment. At the same time it can be IP protected to block alternatives and has an insured third party collective payment coverage to guard against the treated running out of funds to afford the perpetual dependency…

> The 'ideal' drug from a business point of view not only not cures the patient long term...

There is another one. Vaccines. Or any preventive medicines that does not actually require people to be sick.

You just need to inject massive amount of fear of diseases (Statistics is your friend here) into the populace to create a nice, ever increasing demand of your produce...

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#35

Post by lultimouomo »

perseiden wrote: post #27
javajosh wrote: post #21

Wait a sec, Gilead made $12.5B in 2015, $4B this year, on a single drug, and that's not enough ? Gosh, I remember when $16.5B was a lot of money.

Bringing new drugs to markets is expensive: https://en.wikipedia.org/wiki/Cost_of_drug_development (These costs include the other 90% of drugs that have probably failed at some development stage)

So assuming Gilead spent per drug 10% more than the company that spent more in that list, they recovered the whole development cost in a single year. Most industries don't come even close to that.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#36

Post by dmurray »

buvanshak wrote: post #34
PeterStuer wrote: post #24

The 'ideal' drug from a business point of view not only not cures the patient long term, it offer a short term mitigation while increasing the risk on relapse and thus future recurring consumption of the treatment. At the same time it can be IP protected to block alternatives and has an insured third party collective payment coverage to guard against the treated running out of funds to afford the perpetual dependency…

> The 'ideal' drug from a business point of view not only not cures the patient long term... There is another one. Vaccines. Or any preventive medicines that does not actually require people to be sick. You just need to inject massive amount of fear of diseases (Statistics is your friend here) into the populace to create a nice, ever increasing demand of your produce...

Vaccines also only get administered once, or a small number of times, per patient. It's hard for them to be as profitable as a drug which is "take this 3 times a day with meals, for the rest of your life, or you die".

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#37

Post by xg15 »

sjtgraham wrote: post #32
_lbaq wrote: post #2

Thats why "we the people" need to have large part in developing new drugs and the care of people, this is nothing that can be left to the "market" in some hope that it will "work out".

There is nothing to say the market won't solve problems. Innovations like Gilead's are inevitable. A cure might make less money than chronic treatment, but once a cure exists nobody is buying the treatment. It's rational to develop the cure if you want returns.

If your ultimate goal is sustainable profit, it would be rational to not even look for a cure at all.

As long as there is no practically usable permanent cure, everyone has a stable source of revenue from chronic treatment solutions.

Once anyone develops one, the chronic treatment would become significantly less attractive (as you say), so revenue would become less predictable for all parties, including the party that developed the cure.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#38

Post by PeterStuer »

xg15 wrote: post #31
PeterStuer wrote: post #24

The 'ideal' drug from a business point of view not only not cures the patient long term, it offer a short term mitigation while increasing the risk on relapse and thus future recurring consumption of the treatment. At the same time it can be IP protected to block alternatives and has an insured third party collective payment coverage to guard against the treated running out of funds to afford the perpetual dependency…

This. I'd go further and say that a system where innovation is driven by profit is good at perpetually managing problems but very bad at actually getting rid of them.

If you dig even further, you will find things like 'unhappy people consume more as they try to buy their way out of misery'. Now of course you don't directly sell unhappiness, but you can sell goods of which the consumption benefits the individual that consumes it, but deteriorates the world a little bit for everyone as a result. A car is a perfect example. Great benefit to the buyer, but through noise, pollution, taking up space etc. a bit of a nuisance to all others and making them more likely to also consume a car so as to at least participate in the benefits. This ends up in a situation where everyone gets locked into a net negative system where individual escape (dumping your own car) just makes you worse of as you just forego the individual benefit without any perceptual change in the collective negatives.

Re: Goldman Sachs questions whether curing patients is a sustainable business model

#40

Post by dmurray »

sjtgraham wrote: post #32
_lbaq wrote: post #2

Thats why "we the people" need to have large part in developing new drugs and the care of people, this is nothing that can be left to the "market" in some hope that it will "work out".

There is nothing to say the market won't solve problems. Innovations like Gilead's are inevitable. A cure might make less money than chronic treatment, but once a cure exists nobody is buying the treatment. It's rational to develop the cure if you want returns.

All possible pharmaceutical innovations are not "inevitable", at least not in any given time frame. It may be that pharma companies know which R&D approaches have a chance of producing a permanent cure, and which ones are more likely to result in a chronic treatment, and they focus their efforts on the former.
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