Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

cnbc.com

Post reply on HN
Print view View original

111–120 of 188 posts

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#111

Post by instagraham »

Sad but necessary headline (if you don't get attention, no one clicks) that kinda obscures what the report marks as a solution - and no, it's NOT refusing to cure patients.

I'm not even close to being a libertarian, but I find that people expect biotech companies to swallow billions of $ of loss as some sort of public good. Reports like these are an attempt to better harmonise their survival model. Companies need to make money to offset their losses, if not to profit. And while biotech companies can profit, these can very quickly be offset by the cost of a single clinical trial - IIRC it costs $1 billion to take any new drug from trial to completion now. Imagine discovering the next penicillin in your garage and then needing to raise $1 billion to cure people with it?

The analysts recommendations are fairly tame - companies should target cures for diseases with a lot of sufferers (a social good) + note that there are a LOT of genetic diseases that could benefit from a single-shot cure.

Again, not a sympathiser for "big pharma" if that even exists, but I wonder how sustainable a model this can be if companies can get their stock wiped out by a single bad trial. Pharma is notorious as a risky investment - which for some, might sound like a problem for rich people. But really, it then becomes a problem to fund experimental research, the kind that pays off.

I'm not looking to defend pharma companies here, only to frame a slightly more reasonable set of terms for this debate. I'm sure such reports have their harms - rare, incurable diseases will get less attention. But we need a solution that acknowledges the constraints, not one that merely wishes away the limits of capital and sustained long-term research.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#112

Post by OneMorePerson »

socalgal2 wrote: post #74
stego-tech wrote: post #22

I feel kinda bad for the writer, because it's a good question: no, curing patients is not a good business model, just like public transit is not a good business model. What a lot of folks neglect are N+1-order effects, because those are harder to quantify and fail to reach the predetermined decision some executive or board or shareholder has already made. Is curing patients a bad business model? Sure, for the biotech…

> ~public~ transit is not a good business model. ~public~ transit can be a good business model if it's setup correctly. The majority of Japan's 100 train companies are setup such that they own both trains and complementary interests. Office buildings, shopping centers, super markets, apartments. The better their trains are the better their other businesses do by delivering people to them. The better their other busin…

I think you and the person you are responding to are saying the same thing?

I don't think they literally meant public transit can't be profitable in any scenario, they meant that it takes a conscious choice to put money into transit with the intention of reaching some second benefit, which is a pretty good comparison to this topic too.

The public transit by itself is a money loser compared to alternatives, but by having it in place you get other benefits that make it worth it overall.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#113

Post by energy123 »

selcuka wrote: post #108
energy123 wrote: post #52

Earlier quoted context omitted.

Energy123's law of headlines: Any headline that ends in a question mark will have an associated comments section mentioning Betteridge's law, despite that law having being empirically falsified.

Selcuk's Law of Generalisations: Any mention of an adage will have an associated comment claiming that it can be falsified by giving at least one counter-example.

The answer is 'yes' more than 50% of the time according to a few studies. It's not just one counter-example.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#114

Post by BobbyTables2 »

stego-tech wrote: post #35
anonymouskimmer wrote: post #28

Earlier quoted context omitted.

If a person dies from a disorder in their 20s, they'll never buy your heart medication in their 70s. Today's patient is tomorrow's patient.

The longer someone lives, the more potential value they can contribute to a society. The opportunity cost is something we've figured out from a medical perspective, but shareholders want returns today, not returns fifty years from now. That is what we need to address.

It’s odd because many other industries like wineries, nut orchards, etc. do all play the long term game successfully.

Even medical drugs take a while to develop but somehow the sales has to be “right now”.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#115

Post by s0rce »

apparent wrote: post #98
s0rce wrote: post #91

Earlier quoted context omitted.

I did my PhD in an adjacent area and its not clear any of these come anywhere close to regenerating your enamel.

Thanks for chiming in. What do you think they do, and why do you think they are perceived as being more effective than they actually are? Any thoughts on the bacteria-morphing one?

I don't know too much about the bacteria stuff. Regarding enamel, the native structure is very intricate and contributes to the properties. Most of the acellular chemical reminalization just deposits disorganized minerals on the teeth. It might be improved vs. doing nothing (I'm not sure but I do use fluoride reminalization from the dentist) but its not regenerating your enamel. Imagine just slapping some concrete or mortar all over a slowly decaying intricate brick wall vs. rebuilding the brick structure; you may mitigate complete collapse but you didn't fix the decaying brick wall.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#116

Post by mattmaroon »

The basic premise is kind of dumb because it’s irrelevant.

For one thing, the pharmaceutical industry isn’t one company, it’s hundreds. The example given (Gilead) is of one company that ate a market. They made $70 billion (and continuing) curing Hep C. They probably don’t lose sleep at night about the hundreds of billions in future revenue that will have prevented the other pharmaceutical companies from making when that disease is gone. This is one case where profit incentives align with human welfare.

Look at fisheries. They’re collapsing everywhere due to overfishing, the very definition of unsustainable business, because each individual fishermen’s incentive is to catch as much as they can.

For another, not all diseases are eliminated by the invention of a cure. Cures for cancer would lead to us living longer and getting more cancer. Cures for emphysema might cause more people to smoke and induce demand.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#117

Post by ComplexSystems »

AuthAuth wrote: post #14
idontwantthis wrote: post #10

Earlier quoted context omitted.

As long as government regulation prevents them from forming a cartel.

It shouldnt be limited to companies within the country. Any foreign company can be a market disruptor here. Assuming the drug approval admin isnt working alongside the 'cartel'.

And only in the very particular scenario of a national-only cartel which has not successfully roped in other international pharma companies.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#118

Post by ChrisMarshallNY »

stego-tech wrote: post #22

I feel kinda bad for the writer, because it's a good question: no, curing patients is not a good business model, just like public transit is not a good business model. What a lot of folks neglect are N+1-order effects, because those are harder to quantify and fail to reach the predetermined decision some executive or board or shareholder has already made. Is curing patients a bad business model? Sure, for the biotech…

> If all you're judging is the first-order impacts on a single business, you're missing the forest for the trees.

Sounds like typical American C-Suite thinking. From what I can see, maybe Chinese companies see further, and that may just be because the government is so powerful, over there, and the government is known for taking the long view.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#119

Post by mattmaroon »

KingMob wrote: post #106
HarryHirsch wrote: post #44

Earlier quoted context omitted.

Yet meanwhile, women entered the legal profession in the 1920's but wages did not catch up until the 1960's when the Equal Pay Act was passed. Economics 101 would say you could snap up competent female lawyers for a little more than they were paid at their current firm and thus wages would creep up, yet this would not happen.

Not sure why you're being down-voted. Efficient markets for talent shouldn't tolerate racism/sexism/etc, but all the historical evidence is to contrary. It's almost as if rational _homo economicus_ is a bad foundation.

I don’t think so. It’s not that law firms intentionally passed up on bidding a little more for women because they were as good as men but cheaper. It’s because they thought the women were simply less good.

It takes awhile for people to change their view. If you come from a society that has for thousands of years said women couldn’t do jobs like be a lawyer as well as men, it’s not crazy that it would take you 40 years to figure out that wasn’t true.

It’s not a bad foundation when it comes to something like what we’re discussing, allocation of capital by professional investors in the medical space. They’re pretty close to homo economicus, but they’re still human so they still err.

Re: Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

#120

Post by amarant »

unethical_ban wrote: post #38
thousand_nights wrote: post #24

Earlier quoted context omitted.

yeah but the pharma comapnies are only in the business of selling drugs so they would need to diversify into retirement homes or somnething to profit from actually curing people

Or some kind of organization, some kind of union of all people, could pool their money and invest in such a thing.

That sounds like theft!

/s

Post reply on HN