Would President Obama kill drug development?
November 4th, 2008 | by Brian Schwartz |
He would, suggests Charles Hooper at Forbes.com. Some selections:
Say a biotech company is developing a new drug for breast cancer. My consulting firm, Objective Insights, looks at the financial value of the project. If the expected value–probability-adjusted value–of the project is negative, we suggest discontinuing development. Often, millions of dollars have already been spent. …
…the cost of getting one new drug approved [by the FDA] was $802 million in 2000 U.S. dollars, or $1.02 billion in 2008 dollars. Most new drugs cost much less, but his figure adds in the expense of each successful drug’s prorated share of failures.
America’s health care system might someday look like mainland Europe’s. There, when a drug is approved, sales are insignificant until the government-run health system agrees to pay for it. …
Things are even worse in the U.K., where the National Institute for Health and Clinical Experience (NICE) evaluates new drugs on their economic value. While this may sound fair, NICE requires even more clinical data from drug companies–increasing cost, time and risk–and then rejects just about every new medicine that comes in front of it.
In effect, NICE is a gatekeeper that prevents the struggling national health system from paying for new, expensive medicines. As a result, diseases like prostate cancer are treated with outmoded technologies–and significantly less aggressively–than in the U.S. If NICE controlled our automobiles, we would all be driving used 1983 Honda Civics. …
It’s not surprising that a drug reimbursement framework like NICE is what Obama and other Democrats want to bring to America.
Read the whole article here.
I assume that Hooper is referring to Obama’s support for single payer health care. I wish he’d spelled out Obama’s explicit support for something like NICE. But in the end, under single payer, government is the gate keeper to all medical care.
(Via David Henderson at EconLog.)
tags: FDA, medical technology and innovation, ObamaCare, UK health care
