Posted on 04/07/2016 7:00:57 AM PDT by Kaslin
Last week, presidential candidate Senator Bernie Sanders joined 11 other members of Congress in sending a letter to the National Institute of Health (NIH), urging the agency to cut costs for the prostate cancer drug, Xtandi, by employing its “march-in rights.” These rights, which have never before been utilized by the NIH, were established in 1980 under the Bayh-Dole Act, which gives federal agencies the authority to license a patent when action is deemed necessary, primarily as an emergency tactic. Using this provision as their justification, lawmakers are requesting that NIH override Xtandi’s patent protection, which guarantees its manufacturers exclusive sales, in an effort to reduce the costs of the drug.
This request represents an enormous overreach by the government into U.S business and a major threat to the drug development process as a whole. However, Senator Sanders’ proposal doesn’t just have the potential to undermine the drug development system, it also poses a serious danger to the patent system by allowing the government to intervene in the protection of intellectual property.
The Constitution gives Congress the power to grant patents under Article I, Section 8, Clause 8. The establishment of patents is a key constitutional right and critical to fostering American innovation and growth for well over two centuries. Like the property rights our founding fathers valued in the highest degree, the protection of intellectual property has been key to America’s success, responsible for establishing us as a global leader across many industries. Undermining the patent system, even for just one patent in one industry, would call into question our nation’s entire system for protecting intellectual property and undercut a core American value that sets us apart from other nations.
Encouraging NIH to utilize their “march-in rights” threatens all of this and although Senator Sanders’ letter focuses on the biopharmaceutical industry, it’s not just one industry that should be concerned. Having federal agencies intervene in patents, as Senator Sanders would like, sets a dangerous precedent of government overreach into the free market. Furthermore, what he is suggesting is a complete re-interpretation of legislation. The Bayh-Doyle Act was adopted to assist in the manufacturing of products to meet need during health or other public emergencies. In 35 years, these rights have yet to be deemed necessary by the NIH.
Patents are critical for any industry (or innovator) that takes risks to develop better products that move us forward and the biopharmaceutical industry is no exception. Biopharmaceutical companies operate under a complex business model-balancing the needs of patients, the demands of investors, and the hefty regulations imposed by the government. In order to encourage the development of innovative drugs (like Xtandi), the industry relies on patent protections to justify their investments. Allowing the government to step in and alter this system would most certainly have dire consequences-namely, new drugs might not be developed.
In their letter, lawmakers requested NIH hold a public hearing to override Xtandi’s patent, which they believe would lower the cost of the medication. What they fail to realize, however, is that in their attempt to improve access to life-saving medications like Xtandi they are actually threatening the future of innovative medicines. If investors know that patents are no longer protected and returns will be limited, the incentive to fund critical research and develop new treatments will plummet. If we want to continue to see progress in medicine, or in any industry for that matter, we can’t let the government interfere in patent protections.
Attacks like this on individual drugs and their manufacturers won’t fix the systematic problem of rising healthcare costs in our country, in which insurers, hospitals, and healthcare providers all play a role. Targeting Xtandi individually and asking for more government intervention is not only a clear political move by Senator Sanders that won’t actually improve access to medicines for Americans, but a play that will also dismantle the entire patent system that protects U.S. innovation and specifically the development of effective treatments. With innovators on the cusp of major advances in disease areas like cancer, diabetes, and Alzheimer’s we need to be looking towards reforms that encourage drug development and accessibility, not misguided proposals that propel unnecessary and unwarranted government overreach in the healthcare market and everywhere else.
So if someone invests their own time and money and develops a product that could potentially save lives, they can be forced to sell at a loss? So they don’t really own it anymore? What if that product doesn’t work out for some and they are used? Do they suddenly become the owner again?
Good point!
Stupid analogy. There is no looming harm to others. That would imply you’re insinuating they should stop selling the drug because someone not using it might get hurt by others using it.
Better analogy would be that dam providing irrigation or electricity, selling to those paying a high price while others go without and b!tch that he won’t sell it cheaper at a price point convenient for them.
The core point you’re COMPLETELY MISSING:
They don’t have to do it _at_all_.
The pharmaceutical company doesn’t have to create the drug ... so nobody would get it.
The dam owner can just let all that water out or not build the dam ... so nobody gets irrigation/electricity.
Take away the profit incentive, and they just won’t do it. There won’t be the next lifesaving medicine not yet available. There won’t be hydroelectric power or clean consistent water. Drugs & dams are EXTREMELY EXPENSIVE to create (and create to high standards*); they may be easy to benefit from thereafter, but without promise of big payoff (don’t forget the risk of _losing_ $billions if it doesn’t work) it won’t be done.
* - Mosul Dam in Iraq is among the largest in the world. Insufficient effort went into building it. There is no meaningful benefit (profit) in maintaining it. And as a result, the ancient city of Mosul _will_ be washed away this year when it collapses, killing about a half-million people. Interesting lesson in half-assed socialistic economics.
“Basic research and development is more than a crap shoot, but often not much more.”
I used to work for a medical products company (blood analysis).
The core of the product involved a chemical which required 6 months to make, and which the company (150 people) could only afford to make 2 gallons of per year.
If _ONE_ batch went bad (long, complex, sensitive process), the company darned well better have enough cash on hand to keep functioning, with near zero revenue, for a full year.
Yeah those single-use packets weren’t cheap. They didn’t just have to pay for themselves, continued employment of workers, and profit for owners/investors, they had to cover surviving the loss of just 1 gallon of their magic potion without which the business (and all employees, from CEO to janitors) faced collapse.
of course that is your choice. I take you have no one who is important to you.
Interesting that because there might be dead animals in the body of water it you think it is ok to add your body.
I feel sorry for you and any family you have.
OF course Bernie Sanders is dangerous. He’s a friggin communist and never tried to hide it.
http://nypost.com/2016/01/16/dont-be-fooled-by-bernie-sanders-hes-a-diehard-communist/
You split a hair that does not exist. Are you that stupid or are you trying to play on the ignorance of others.
Every pseudo intellectual libertarian would change their tune the instant their child came down with cancer and a drug company was charging "what it wanted."
There is always a rule of reason.
No legal system has ever given a property owner untrammeled license to do as they please.
As an accountant and chief financial officer, yes I have heard of amortization. You claim to know what I’m assuming and that I’m not knowledgeable, but maybe you should look in the mirror.
All of the protective laws are based upon experience society had with "Free Markets," "Freedom of Contract," and myriads of abuses by untrammeled capitalism. Once again it is over regulation and ill considered regulation that creates problems.
Pretty standard really. Do you believe that people can so use their property that they can cause harm? Can you even define “property?”
How is a person "harmed" by someone creating a drug that can save their life?
If you spend some logical thought time on it, when politicians take away the profit incentive and because of that a drug does NOT get invented, the politicians themselves are the one doing harm.
Have you ever heard of an "Adhesion Contract?" That is where one person has all the power in a bargaining position and the other party is free to pay what is demanded or walk away. Such contracts are controlled and rightly so.
A person would certainly be harmed if the drug company used its bargaining power viv-a-vis the consumer. The flaw in the Libertarian argument is their failure to recognize there is a vast difference in bargaining power among various persons, firms or entities. Imagine you personally going to a giant drug company and trying to bargain their price down for a drug that would save your five year olds life.
Why don't YOU imagine being told that EVERY 5 year old with this affliction will die because the drug that could save them was never developed. There was some promising research but the investment was simply too high to proceed.
See how that works?
Show me a real world example of a promising drug that was never developed because the investment was too costly due to governmental interference in setting the price to the consumer. Name the actual drug.
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