In Goldman Sachs's April 10 report, "The Genome Revolution," its analysts ponder the rise of biotech companies who believe they will develop "one-shot" cures for chronic illnesses; in a moment of rare public frankness, the report's authors ask, "Is curing patients a sustainable business model?"
The authors were apparently spooked by the tale of Gilead Sciences, who developed a Hepatitis C therapy that is more than 90% effective, making $12.5B in 2015 — the year of the therapy's release — a number that fell to $4B this year.
The analysts are making a commonsense observation: capitalism is incompatible with human flourishing. Markets will not, on their own, fund profoundly effective cures for diseases that destroy our lives and families. This is a very strong argument for heavily taxing the profits of pharma companies' investors and other one percenters, and then turning the money over to publicly funded scientific research that eschews all patents, and which is made available for free under the terms of the Access To Medicines treaty, whereby any country that devotes a set fraction of its GDP to pharma research gets free access to the fruits of all the other national signatories.
Humans have shared microbial destiny. If there's one thing that challenges the extreme libertarian conception of owing nothing to your neighbor save the equilibrium established by your mutual selfishness, it's epidemiology. Your right to swing your fist ends where it connects with my nose; your right to create or sustain reservoirs of pathogens that will likely kill some or all of your neighbors is likewise subject to their willingness to tolerate your recklessness.
Goldman Sachs's analysts suggest three "cures" for the problem of one-shot cures; and taxing the rich to fund socialized pharma research isn't among them; rather, they propose eschewing rare diseases, to ensure that the pool of patients is large enough to produce a return on their investment, or developing one-shot cures fast enough to "offset the declining revenue trajectory of prior assets."
"The potential to deliver 'one shot cures' is one of the most attractive aspects of gene therapy, genetically-engineered cell therapy and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies," analyst Salveen Richter wrote in the note to clients Tuesday. "While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow."
Goldman Sachs asks in biotech research report: 'Is curing patients a sustainable business model?' [Tae Kim/CNBC]
(Image: Dv8stees, CC-BY-SA)
.png){kind=link}