ONE OF THE very first rules of American politics is not to select a fight with Huge Pharma. Its army of lobbyists in Washington, DC, has made sure that presidents from both celebrations, from Ronald Reagan to Barack Obama, have actually supported the market’s stout defence of intellectual-property (IP) rights, including in global treaties. Donald Trump threatened to enforce drug rate controls, which won bipartisan assistance in Congress, but intense lobbying made sure that his initiative flopped. That effort to check Big Pharma chimed with the industry’s international image as big-headed and greedy.
President Joe Biden is throwing his weight behind a proposition at the World Trade Organisation to waive patent defenses for covid-19 vaccines. If Mr Biden wants to reconsider IP rights for covid vaccines abroad, he might likewise have the audacity to take on patent protection for new drugs in the house. To evaluate whether America’s industry is worthy of such treatment, it deserves asking three questions. First, how much innovation is taking place? Second, is rent-seeking behaviour– varying from rate gouging to patent control– decreasing? Third, what might occur if patent guidelines were watered down?
Start with innovation. In the 2000 s pharma investment fell out of fashion. But because 2010 America’s market has raised costs on research study and development (R&D) …