Creating the conditions for biomedical innovation is a lot cheaper than spending bailout money to keep car companies operating by lending them money, giving consumers loans to buy the cars they can't afford in the first place and then covering the warranties and car payments.
Biotech gets short shrift from Obama
His policies don't support entrepreneurial medical innovation.
By ROBERT GOLDBERG
Vice president, Center for Medicine in the Public Interest
President Barack Obama said last month that small businesses "are the heart of the American economy." He promised his administration would do everything it could to help entrepreneurs since they were the "core of America's story."
Yet, Obama's policies are threatening biotechnology – one of the most vibrant and important forms of small business our nation has ever produced.
Medical innovations have added wealth and health to our nation. From 1970-2000, increased longevity added approximately $3.2 trillion per year to national wealth, the equivalent of half of the average annual gross domestic product over the period.
According to a 2004 study by the Milken Institute, biopharmaceutical companies are responsible for creating over 2.7 million jobs across the United States. The industry was directly responsible for $63 billion in real output in 2003 and a total output of over $172 billion when its ripple effect is figured in across other sectors.
The president has increased federal funding for basic research and stem-cell science. With $20 billion a year in research funding, the National Institute of Health is important. But to translate discoveries into treatments will require more than the nearly $60 billion in money currently being invested by pharmaceutical, biotech and venture capital firms on cutting-edge treatments for cancer, Alzheimer's, AIDS, mental illness and heart disease.
That investment is (in real dollars) declining. Less than half of all public biotech firms have six months of cash left for research. For startups the situation is direr, even though the scientific promise of their investment is great.
Yet at every step of the way, President Obama supports policies that will stifle the entrepreneurship that he praises, and which are vital to actually producing real cures.
Obama supports de facto price controls that would allow the "reimportation" of prescription drugs. In essence, this is an effort to force every pharmaceutical and biotech company to sell drugs here at the controlled prices imposed in Canada and Europe.
Yet these are the same price controls that shut down medical innovation in those nations – companies sell their wares there for a small profit, but they don't risk the money to develop new lifesavers for those markets. If reimportation worked to force down prices here, it would also shut down the innovation Obama claims to favor.
Obama is establishing a comparative effectiveness council to slow down the introduction of new medical technologies. This entity would, like similar agencies in England and elsewhere, allows economists to compare old treatments with new ones and then tell doctors how much someone's life is worth – and whether it's worth saving – in order to save money.
The impact on innovation and patient well-being should be obvious. The UK's comparative effectiveness panel said new cancer pills were more effective than debilitating chemo treatments and extended life but still weren't worth paying for. No wonder the UK biotech industry issued a report blaming comparative effectiveness for killing not only people but the incentive for innovation.
Obama wants to apply comparative effectiveness to Medicare and eventually to every health plan. This would delay and ration the elderly's use of breakthrough drugs and ultimately let the government control what drugs and treatments everyone can take. In Europe, over the past 10 years, similar restrictions have caused the development of new drugs to stall. From 1993-97, Europe launched 81 breakthrough drugs; from 1998-2002, just 44. Meanwhile, U.S. drug launches jumped from 48 to 85.
Finally, it is disappointing that Obama made food safety, not medical progress, his number one concern in reforming the Food and Drug Administration. Indeed, Obama added money to the FDA's budget to inspect spinach but not to speed up the approval of breakthrough drugs for spinal cord injuries, multiple sclerosis and rare diseases. The agency has a program using 21st-century science – such as gene and stem cell-based tests – to determine if new medicines work. But Obama has refused to add money for that effort. You can score more political points sticking it to drug and biotech companies than standing shoulder to shoulder with dying patients.
Together, these policies are draining the life out of the biotechnology industry. The president is investing in "green" technologies to promote the environment. Yet, his health care policies will undermine private sector investment in medical innovations critical to solving public health problems related to the aging and growth of the world's population.
For all his rhetoric, thanks to his policies the medical discoveries the president supports will never be translated into economic prosperity or treatments that transform humanity.
Click Here to Read the Full Article
Biotech gets short shrift from Obama
His policies don't support entrepreneurial medical innovation.
By ROBERT GOLDBERG
Vice president, Center for Medicine in the Public Interest
President Barack Obama said last month that small businesses "are the heart of the American economy." He promised his administration would do everything it could to help entrepreneurs since they were the "core of America's story."
Yet, Obama's policies are threatening biotechnology – one of the most vibrant and important forms of small business our nation has ever produced.
Medical innovations have added wealth and health to our nation. From 1970-2000, increased longevity added approximately $3.2 trillion per year to national wealth, the equivalent of half of the average annual gross domestic product over the period.
According to a 2004 study by the Milken Institute, biopharmaceutical companies are responsible for creating over 2.7 million jobs across the United States. The industry was directly responsible for $63 billion in real output in 2003 and a total output of over $172 billion when its ripple effect is figured in across other sectors.
The president has increased federal funding for basic research and stem-cell science. With $20 billion a year in research funding, the National Institute of Health is important. But to translate discoveries into treatments will require more than the nearly $60 billion in money currently being invested by pharmaceutical, biotech and venture capital firms on cutting-edge treatments for cancer, Alzheimer's, AIDS, mental illness and heart disease.
That investment is (in real dollars) declining. Less than half of all public biotech firms have six months of cash left for research. For startups the situation is direr, even though the scientific promise of their investment is great.
Yet at every step of the way, President Obama supports policies that will stifle the entrepreneurship that he praises, and which are vital to actually producing real cures.
Obama supports de facto price controls that would allow the "reimportation" of prescription drugs. In essence, this is an effort to force every pharmaceutical and biotech company to sell drugs here at the controlled prices imposed in Canada and Europe.
Yet these are the same price controls that shut down medical innovation in those nations – companies sell their wares there for a small profit, but they don't risk the money to develop new lifesavers for those markets. If reimportation worked to force down prices here, it would also shut down the innovation Obama claims to favor.
Obama is establishing a comparative effectiveness council to slow down the introduction of new medical technologies. This entity would, like similar agencies in England and elsewhere, allows economists to compare old treatments with new ones and then tell doctors how much someone's life is worth – and whether it's worth saving – in order to save money.
The impact on innovation and patient well-being should be obvious. The UK's comparative effectiveness panel said new cancer pills were more effective than debilitating chemo treatments and extended life but still weren't worth paying for. No wonder the UK biotech industry issued a report blaming comparative effectiveness for killing not only people but the incentive for innovation.
Obama wants to apply comparative effectiveness to Medicare and eventually to every health plan. This would delay and ration the elderly's use of breakthrough drugs and ultimately let the government control what drugs and treatments everyone can take. In Europe, over the past 10 years, similar restrictions have caused the development of new drugs to stall. From 1993-97, Europe launched 81 breakthrough drugs; from 1998-2002, just 44. Meanwhile, U.S. drug launches jumped from 48 to 85.
Finally, it is disappointing that Obama made food safety, not medical progress, his number one concern in reforming the Food and Drug Administration. Indeed, Obama added money to the FDA's budget to inspect spinach but not to speed up the approval of breakthrough drugs for spinal cord injuries, multiple sclerosis and rare diseases. The agency has a program using 21st-century science – such as gene and stem cell-based tests – to determine if new medicines work. But Obama has refused to add money for that effort. You can score more political points sticking it to drug and biotech companies than standing shoulder to shoulder with dying patients.
Together, these policies are draining the life out of the biotechnology industry. The president is investing in "green" technologies to promote the environment. Yet, his health care policies will undermine private sector investment in medical innovations critical to solving public health problems related to the aging and growth of the world's population.
For all his rhetoric, thanks to his policies the medical discoveries the president supports will never be translated into economic prosperity or treatments that transform humanity.
Click Here to Read the Full Article
