Drug Patents

Most people have heard the ethical dilemma, would you steal medicine to save your mother?

Most people will argue that life is more important than profit, so of course you should. Others will take a more holistic view, that if everyone stole medicine the company will never make the medicine in the first place. So for the good of society you should not steal it.

This dilemma is the core debate over medical patents. A pharmaceutical company will need to charge a premium to recover its research costs, yet a generic manufacturer can make the medicine affordable to everyone. So should the developing company be granted a monopoly via a patent?

Without the patent, companies will not invest in research, unless governments provided the funds for it. This would mean a government bureaucrat deciding which idea should be funded. People are much better at picking winners if they are gambling with their own money.

Another alternative is to replace the patent monopoly with a royalty. So anyone can produce the drug as long as they pay a percentage of the revenue to the patent holder. This would work for treating common diseases, where there is sales quantity. But for rare diseases, the royalty is unlikely to reimburse the development costs.

Finally, you could replace the fixed time period. Instead the patent expires once development costs have been recovered. Then the issue become how to isolate the costs to a particular product. Especially when a failed experiment will contribute to a breakthrough on a different drug.