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> Until now, making patented drugs has been one the most profitable legal
> industries, if not the most profitable, on earth. I doubt that's going to
> change profoundly. The U.S. government subsidizes the industry's basic
> research costs (NIH, university contracts, etc.) while industry gets to
> privatize all the profits.
well, yeah, this is all true but it doesn't quite capture the complexity of the process--in part because the USG is far from monolithic, and the various agencies involved (NIH [and note that the I stands for InstituteS, plural], FDA, etc.) are in constant conflict with each other. in aggregate, pharmaceuti- cals may continue to be profitable, but only under conditions of exponentially increasing risk for individual companies. the microchip industry is a good model for the masses of capital involved; but now add in NIH and FDA turf wars, demogogic fed- eral representatives who are angling for the headlines that exposes bring, military involvement in research, etc. oh, yeah, and the fact that a multibillion-dollar research effort might produce a drug that doesn't work or works the wrong way--you start to get the picture. in thinking about this field, it's very important to understand how fundamentally political it is and how sloly it moves on the political plane: if companies try to cut corners in testing, they'll pay dearly, and pay for a long time to come.
privatizing the profits from these publicly subsidized researches isn't a sustainable regime, and a lot of regulators simple know it. and however powerful the US, its intellectual property regime wrt pharmaceuticals will inevitably come into direct conflict with global trade regimes--witness gore's growing problem with his advocacy of US AIDS drug manufacturers vis-a-vis south africa. that's only a taste of what's to come.
it's not at all a foregone conclusion that pharmaceuticals will remain profitable to their current degree, at least not without some very serious deviation from the generic shift toward rele- gating high-risk research to startups that are subject to share- holder demands for fast profitability, thereby precluding any 'plan b' should a research effort fail.
cheers, t