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Most of the criticism against drug companies is that while they invest x for R&D and actual manufacturing, they earn back at least 100*x in profits. I don't think there are many other industries that allow this to happen.

I'm not entirely familiar with what makes pharma patents that much different from software (you don't really have a monopoly even if you own a software patent), but that's basically what's happening.

Once a company gets a patent, free market rules no longer apply, and they are free to price their drugs as they want.




> while they invest x for R&D and actual manufacturing, they earn back at least 100*x in profits.

If that is true, VC's money will be flooding over pharmaceuticals instead of Silicon valley. This "100x" number probably fails to account for the vast number of failed trials that is all cost and no profit.


Typically quoted values are (in the current market), approx. $2-3B per product brought to market.

Drug development is incredibly difficult -- for very good reasons. The FDA has to be risk-averse in order to protect the health of the public and to prevent harm to be done.


More cynically, the FDA has to be risk-averse because people get much more upset over "this person died because the FDA approved a bad drug" than over "this person died because the FDA didn't approve the drug that would have saved her".




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