Hmm... a system where uncommon but extreme spikes in the cost of care are artificially distributed so that an entire society can bear them as a group... that sounds oddly familiar...
Jokes aside - while people are justifiably pointing out the community healthcare angle, arguably this problem is exacerbated by the American FDA drug approval model, ie no corporation will fund clinical trials unless they're guaranteed a profit monopoly.
The idea is that big pharma companies have to publicly post a price for each of their patents. If anyone is prepared to pay that price they get the patent for that price. Next there needs to be a tax that is a percentage of the price of the patent. The money that comes from this tax needs to be funneled back into healthcare or even better go straight to the ones who are paying for the particular medicine that the patent protects.
Now the level of innovation can be set by how high the percentage of the tax is. If the tax is very low healthcare will be expensive but there can be lots of innovation. If the tax is high healthcare costs will be low but one can also not expect much innovation.
Of course, there also are some other things that need to be fixed. E.g., doctors should not get all of their schooling financed by pharma companies and so on.
The general idea of such taxes could be applicable to any sort of non-replacable entity, e.g., it could also apply to land. For one thing, this would make feudalism regarding land quite impossible, which would generally be considered a good thing.
Tax money is allocated for one thing is often used for other things. There is nothing preventing lawmakers from doing this, they after all, make the laws.
My main issue with it is risk or noise. It's not clear how we avoid a bunch of over optimistic actors from "winning" the patent based on wrong estimates and then themselves going broke. Sure, if one or two firms get in trouble they can sell the patent, but what stops a succession of overly optimistic people from holding it to the detriment of everyone? The person who bids highest at an auction could well be the person with the most wrong inputs to his model.
Kinda like how there's this one building in my town that several restaurants have tried and failed in, but as a monopoly.
I like the idea for land rights though. Those are not gonna hold back all of society if a bunch of people do badly at it.
Every single major pharmacy company is actively developing treatments And doing clinical trials where they are in sharp competition and don’t have a monopoly. Obvious example that’s always picked up in US is diabetes. No one has a monopoly on insulin or insulin analogies and you have several corporations constantly competing and innovating improving the treatments.
The reasons for lack of development in some areas is not risk aversion from the pharma companies, it’s just that there simply isn’t a business case for investing there as oppose to other areas in the current setup.
There are a lot of businesses I'd happily set up if I knew I'd have limited to no competition. When competition is more fierce, it disincentivizes me to even try.
If I was guaranteed the lionshare of say, local coffee goers across a large area and didn't have to worry about Starbucks, Peet's, etc. I'm pretty sure I could make it successful and my life would be pretty easy, all things considered.
A lot of rural ISPs can operate this way because it's not viable to compete with their infrastructure foothold in a lot of cases and barriers to entry are high/capital intensive (similar to pharma).
I work in a research environment and there are a lot of funding opportunities/solicitations out there that fit our internal capabilities that we don't even bother writing proposals up for because we know how competitive and unlikely it is to be successful compared to certain other opportunities. Instead, we choose our battles where we suspect we have a higher probability of success: less competitive options. This leads to higher ROI for our time. It works fairly well and I imagine most businesses try to operate under a similar perspective (or more dubiously where they also try to actively stifle their competition).
And at any rate, the alternative is what we have now - no drugs to treat these diseases.
As an aside, the "netflix model" for drug payments is already a reality in Louisiana. Basically the drug maker and state government negotiated a payment for enough hepatitis C drugs to cure everyone in the state.[1]
Only Medicaid + inmates, not everyone in the state?
Why not give $5bn (or whatever the NPV of the drug at a reasonable rate of return might be) in exchange for releasing the drug into the public domain? Then any number of generics manufacturers could be contracted to maintain a stockpile.
(Source: a colleague from another country where the manufacturer also made the drug unavailable asked to have the drugs procured from India)
Edit: the drug was Nexavar by Bayer. The CEO was quoted as saying "No, because we did not develop this product for the Indian market, let’s be honest. We developed this product for Western patients who can afford this product, quite honestly". Recently it seems the Indian courts also allowed export licenses for the drug to other markets where Bayer similarly refused to launch - sadly after the relative of my colleague passed away - at least partially from the delay in procuring the drug.
> for biologics, "the product is the process."
[0]: https://archive.bio.org/articles/how-do-drugs-and-biologics-...
Then the original developer can be the manufacturer. But no need to add hurdles.
Most AR bacteria can be killed by trying different antibiotics. Sure they can mutate to something more dangerous, but it doesn't make sense to make drugs for bacteria that don't even exist yet. There are too many variables to account for.
If you were going to develop the drug at your own cost with no subsidy for failure, why settle for 500M? Why not do it on your kwn merit and reap billions instead? And keep all the IP.
A huge amount of their research already is directly responsible for private industry profits; they can be happy with that freebie. But for things like vaccines in emergencies and insulin, if this be socialism; let's make the most of it.
Basically, rather than paying for drugs on a per unit basis, you pay a lump sum for access to the drug. This solves the issues of spending $100M to develop a new treatment for some disease where there is never a outbreak and you cover none of the cost of R&D.
There have been ideas to have X-Prizes for new antibiotics. Discover a new drug for a anti-biotic resistant infection? Great, here is $500M as long as you agree to produce as much drug as needed for free or some nominal cost.