“The potential to deliver ‘one shot cures’ is one of the most attractive aspects of gene therapy, genetically-engineered cell therapy and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies. While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.”
The article mentions a hepatitis-C treatment that was so effective (90% success rate, rendering patients non-contagious) that revenue dropped by two thirds over the course of a few years.
The Goldman Sachs analysis seems to imply that developing workable treatments would be more profitable than finding effective cures, because cures dry up the customer base. Which sounds like the dank cellar of sociopathic reasoning, except they seem to at least try to redeem themselves by suggesting other conditions to go after for sustainable revenue.
Is this kind of talk disturbing at all? I begin to question whether the open market even should have a place in healthcare.
It is why the open market and “the invisible hand” is while useful in many ways insufficient for healthcare and public investment is also required. Greatest public good is not necessarily equal to greatest profit.
Note that similar limitations on profitability constrain how much Big Pharma is going to invest on new antibiotics. Something that is relatively one and done is not as attractive of a product to develop from a profit perspective as is a better than is current medicine that people take every day forever.
That’s why when people talk about the fact that the US, with its wasteful healthcare system, has more medical research, it needs to be pointed out that much of that research is into things that the drug companies consider to be profitable, not necessarily beneficial to the public.
Now, I’m not into the conspiracy theories that they have cancer cures, and are just holding them back to make a profit off of treatment, but I do not consider it a conspiracy at all to see that there is no profit motive in researching those cures in the first place.
Most of the basic research is done on the taxpayer’s dime in the first place, and the pharmaceutical companies just look at the results that promise to be profitable to develop drugs further.
Note that, while they keep coming up with new treatments for chronic conditions (that require medications for the rest of your life), there’s been very little discovery of new antibiotics, which we desperately need but which can cure with one regimen.
Drug companies are more interested in drugs that they can hook you on; not ones that cure you.
As my age cohort gets older, this is something that I hear quite often.
I occasionally get sick or injured, and I find that things go better if I take some drugs for a bit.
But, when someone has a new blood pressure drug, or anything like that, I ask how long they need to take it, and they say, for the rest of their life. It’s a treatment, not a cure, and more money is made that way.
Antibiotics are a serious problem due to overuse. Right now, we have a strain of salmonella typhi that has acquired not multi-drug resistance but “extreme drug resistance”, making it a very dangerous candidate for a pandemic.
If pharma had not been pushing antibiotics so hard, maybe these resistance situations would not have been cropping up. It is looking like the era of antibiotics will be over in a decade or two and unless we can engineer effective microphage therapies, our children will be back at square one (but phage therapy would be even less profitable than antibiotics).
It’s long been true and recognized that ongoing treatments offer developers long cash flows while cures don’t necessarily offer any more than the one sale (though of course some illnesses get truly cured and later recur).
But while this is true, it doesn’t have to be the only way treatment developers make their decisions.
For one thing, investment in a long term treatment also backfires if somebody else develops a cure. Developing cures often pays well enough for the one organization that comes up with the cure, even if others might be greedy enough to wish they hadn’t.
All Goldman Sachs is doing is pointing this out. They’re not necessarily advocating it. And this holds true for just about any product or pharmaceutical- even motor oil that goes longer between changes has to be priced appropriately or they’ll lose money vs what they’d have made selling the usual stuff at the usual interval.
The problem is that for a lot of drugs, the current state is very profitable, and appropriately pricing a one-shot cure would likely put it out of reach of most people. In a way, they’re damned if they do, damned if they don’t, at least from a financial perspective.
Gilead’s hepatitis C drug sales are indeed declining substantially. But that’s not just due to the initial influx of patients being cured - it’s also due to substantial competition from other drug makers.
Does this somehow mean that other drug companies won’t attempt breakthrough cures? Well, Gilead’s hep C drug has been used to treat over 600,000 patients since 2013. Even if not all of them paid $84,000 apiece for the therapy, that’s still (lessee, 600K x 84 grand, carry the one…) a boatload of money, plus one hell of a brand-building reputation to aid in acceptance of other treatments down the line (they have a drug in the pipeline for treating fatty liver, for instance. There’s lots of NASH (non-alcoholic steatohepatitis) cases out there).
It’s always discouraging to see otherwise rational people falling for the line that drug firms are not pursuing or are avoiding development of cures because it isn’t as profitable as treating chronic disease. For one thing, these companies are made up of people susceptible to currently incurable diseases, who also have friends and loved ones suffering from them. That’s a pretty big incentive to seek cures. If you could come up with a drug that cured a cancer (i.e. pancreatic carcinoma), infection with HIV or multi-drug resistant Staph aureus, or boosted life expectancy in the case of a grim diagnosis by a substantial amount, that’d potentially rake in a huge amount of money, even if sales dropped somewhat after the initial influx of patients. As an independent researcher, if you come up with a novel treatment under the right circumstances, tremendous fame and fortune awaits.
And it’s not as if there isn’t competition aplenty for drugs treating chronic ailments (how many drugs are there now to treat chronic heart failure?), so that’s not necessarily a golden goose.
There’s a role for government incentives/nudges to spur development in certain areas (as in the case of “orphan drugs”). But let’s not fall for the sort of delusional paranoia that says They want us to stay sick to make oodles of cash.
It’s not that they are avoiding it just because they want to make more money, it’s not as if they are saying, “Oh, don’t develop cancer cures, we make more money on the treatment, and we wouldn’t want to lose that revenue stream.”, it is more, “It’ll cost billions of dollars to attempt to develop a cure for this particular cancer, and if we are successful, the return on investment will be in the millions.”
This meme is totally false. Look I know a guy who has been the CFO for several Start-up Pharma companies. The competition is cut throat.
Sure, if BigPharmaCo had a successful long term treatment, there is no reason for *BigPharmaCo *to come up with a cure. But their competitors would love to do so, as it would hurt BigPharmaCo and help them.
I even asked him about a 'cure for cancer" or whatever, and he said his company would fall all over it, even if they lost money due to the publicity and possibly Nobel etc prizes.
So, sure if there was just one company, maybe. But there are many, many.
But there is no “cure for cancer.” There are many, many different cancers, and no treatment could be devised that would cure all of them.
That there are many cancers, and a different cure is needed for each one of them, does mean that there is little financial incentive to produce another cancer cure. We do have some cancers pretty well under control. There are some that if you go to the doctor, what would have been a death sentence 25 years ago is just a one time treatment and cure.
But, that is treating just the one. It is useful to go after some of the more popular cancers, but the rare ones that only a few people a year die from, where’s the money in that?
But it’s not only a competition between different pharmaceutical companies. There’s a competition within each pharmaceutical company over which research projects get funded. There’s only a finite amount of money so some projects get funded and other projects, even if they are worthwhile, do not.
So within each company there are decisions made over which projects make the cut. And from a financial point of view, a project to develop on ongoing treatment is better than a project to develop a one-time cure.