Goldman Sachs Says Curing Diseases May Not Be Economically Viable
Controversy has arisen due to the recent leak of a report by a Goldman Sachs analyst offering this observation for the global investment bank’s clients,“There is a lot less money in curing people than in the long-term management of disease.” This basically means that financially it pays a lot more money to care for sick people than it does to cure them.
If people have to keep paying for treatments, rather than receiving a cure, the healthcare industry makes more money. The obvious and most noble reaction would be to oppose this opinion. People deserve to be cured from their diseases, however the pharmaceutical industry argues that without that continual income that treating diseases brings, there won’t be enough money to fund the creation of more cures. (1)
Is There Money Is Curing Disease?
For example, back in 2015 a cure for Hepatitis C was released called Sofosbuvir. This drug was so powerful that it did indeed cure the disease and prevent future infections after just 12 weeks. That first year the cure had a $12.5 billion profit. Three years later this wonderful medicine is estimated to only bring in 4 billion dollars. In 3 short years the profit from this miracle drug has decreased 7.5 billion dollars and at this rate in a couple of years company will no longer be able to financially support its production. They won’t be able to save lives.
Because of this financial roadblock, pharmaceutical companies cannot justify inventing new cures and testing them. These tests and experiments are incredibly expensive, usually costing at least 1 billion dollars. And even though they are life saving, someone has to pay for them. These companies could demand huge prices for the drugs and require that patients pay for them to help regain their losses, but then only the wealthy would be afford it. This would be an ironic solution because chronic disease is more prevalent among lower income groups. Only the best private insurance plans, unaffordable to those who really need them, would likely cover the costs.
One way to change the situation is to adjust how trials and inventions are being done in order to make it cheaper to introduce new treatments to the market. There are many risks associated with this. Removing essential tests and experiments could do more harm than good.
This is what happened 60 years ago with a drug called thalidomide. Clinical trials, tests, and important steps to determine the safety of this drug were not conducted and many babies were consequently born with defective limbs and other handicaps. Once they traced these tragedies back to the drug, it was no longer obtainable in such relaxed condition. However, it took professionals 10 years to remove this drug from the market and because of that many older adults are still suffering from its side effects. So are the possible life altering side effects worth the lowered price? (2)
Another idea would be to use philanthropic or donated funds. Currently, government funds are used to start the research process, but this money isn’t generally available for the clinical trial stage.
In the end, there is no obvious solution to this problem. People need life saving medications, but health care companies also need money to fund their projects. Both sides are in need but there is no easy compromise.
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