The pharmaceutical, diagnostics, and medical device industries have brought us countless advances over the past 100 years improving both our quality and length of life. Headache pills, antibiotics, cancer drugs; tests to identify risk factors and tests to nip diseases in the bud; blood pressure measuring devices, ventilators, MRI and heart-lung machines. You get the point. The people working in these industries are true heroes of the modern world. But just as with the health insurance and healthcare sectors, they have been progressively more shackled by onerous welfare statist, rights-violating regulations. These regulations aim to keep us safe but result in slowing progress—less of the unimagined stuff—meaning that people continue to suffer and die unnecessarily. So paradoxically today’s system is not as safe as we’d like it to be.
What is needed to liberate these industries from welfare statist regulations? What does it take to unleash the unimagined advances in testing that will identify threats before they develop, in pharmaceuticals that will ease more pain and cure more diseases, and in medical devices that will get us in and out of the hospital in a shorter time? We should focus on two main areas:
1. Repeal FDA (Food & Drug Administration) and USDA (U.S. Department of Agriculture) regulations and let voluntary safety standards develop in the respective industries.
Successful diagnostics, pharmaceuticals, and medical devices depend on rigorous testing. As we mentioned in the previous section, under capitalism this emerges without rights-violating regulation because safety standards are critical for a company’s reputation and long-term survival. Over time those standards become more efficient and shorten the time to market for new products. This means that companies can develop more new stuff for the same amount of money, which means more, better, and cheaper life-enhancing and life-saving products for healthcare providers to choose from, which benefits all of us.
2. Expand patent protection.
Over the past decades, patent protection for new pharmaceuticals, diagnostic tests, and medical devices has deteriorated primarily because of pressure from welfare-statist health-care systems around the world to allow cheaper generic drugs, tests, and devices onto the market.
Intellectual property rights, to which patents belong, is a complicated and continuously evolving field. What inventions qualify for patent protection, and how long it should be granted for different types of products, is constantly being discussed in academic and judicial circles. But it is relatively uncontested that less patent protection means that companies have less time to get a return on their investment in research, development, production, sales and marketing. Which in turn means that they are less willing to take on risks to develop new products.
For example, for every successful drug a pharmaceutical company launches, many others fail during development and trial. Without enough patent protection for the drugs that do make it to market, the company will not have time to make enough money to cover the research and development costs for both the successful drug and the drugs that didn’t make it and at the same time finance future drugs. As a result, fewer drugs are developed to the detriment of all of us. One solution is to expand patent protection and let health insurance companies and healthcare providers negotiate pricing with pharmaceutical companies without government involvement. Yes, some high-demand drugs will be very expensive immediately after launch, but charitable efforts both by the pharmaceutical companies themselves and other organizations will cushion the blow for those without the means to buy them. The true cost of keeping drug prices artificially low is that many new drugs simply never make it to market. We should instead focus on the immense benefits that will result from the expanded pipeline of new drugs, many of them in the unimagined category, easing pain and speeding up both treatment and cures of innumerable diseases.
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