"Everyone is entitled to his own opinion, but not to his own facts." - Daniel Patrick Moynihan
Politicians on the hunt for bigger and bolder ways to lower drug prices are taking aim at a far more central part of pharma's monopoly power: the patents the industry holds on its drugs.
Patents save lives and enhance the value of medicines. As Abraham Lincoln said, "Patents add the fuel of interest to the passion of genius." Two potential presidential aspirants are leading the charge: Senators Elizabeth Warren and Bernie Sanders.
Senator Elizabeth Warren (D-MA) mistakenly believes that pharmaceutical innovation is primarily driven by the National Institutes of Health. She's calling for aggressive use of the Bayh-Dole Act to use "march in" control prices on government inventions, and has drafted legislation —called the Medical Innovation Act — that would strap the private sector with a big new fee.
A study in Health Affairs by Bhaven N. Sampat and Frank R. Lichtenberg puts the issue in a data-driven perspective that gives the NIH its due but in the proper frame of reference. Per Sampat and Lichtenberg, less than 10 percent of drugs had a public sector patent. Drugs with public-sector patents accounted for 2.5 percent of sales, but the indirect impact was higher for drugs granted priority review by the FDA. Priority review is "given to drugs that offer major advances in treatment or provide a treatment where no adequate therapy exists."
"478 drugs in our sample were associated with $132.7 billion in prescription drug sales in 2006. Drugs with public-sector patents accounted for 2.5 percent of these sales, while drugs whose applications cited federally funded research and development or government publications accounted for 27 percent," they wrote.
The NIH plays a vital role in basic research and early discovery, but is robbing Productive Peter to pay Government Paul the best bang for the buck when it comes to advancing public health?