
Goldman Sachs asks: 'Is curing patients a sustainable business model?' - SQL2219
https://www.cnbc.com/2018/04/11/goldman-asks-is-curing-patients-a-sustainable-business-model.html
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jusonchan81
If a company succeeds in eliminating or reducing a major illness (and its
related family of illnesses) from world wide population then they should be
rewarded with a one time cash bonus of what that illness could have cost the
governments around the world for the next decade or so. Or some sort of
formula like that.

One time incentives are always super attractive for employees and staff,
although not so much for investors.

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devoply
Yes which is a very good reason that medicine should be a public good as it in
Canada and many European countries. The whole premise of for-profit medicine
as this article points out is insane.

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fjsolwmv
Yes, European publicly funded medicine works great when R&D is funded by
private sector sales to USA consumers. You're welcome!

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djcjr
Market forces suck at valuing life.

Each country has to decide whether to shoulder the responsiblity of citizen
health, or leave it to the market.

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james_s_tayler
On a personal level we tend to say "life is precious and I value it." or at
least those are the virtues we attempt to signal.

When we act in concert through markets we tend to say "life is cheap and I
don't really care that badly."

People always lament and say that the market gets it wrong but does it? Or is
the truth about how we really feel just a little too horrifying uncomfortable?

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ibash
More the latter, but it’s a bit more nuanced: It’s more honest to say the each
of us values a select few others (for me, maybe a dozen) and everyone else’s
life I don’t value.

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james_s_tayler
That's a fair comment. Though I would say it's not that you don't value those
with a greater psychological distance from you it's that you value them in the
abstract and it doesn't concretely translate to materially caring about them.

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adminu
What if nations funded research and drug production in nation owned facilities
that priced the drugs at production price to national insurances and at higher
prices for world wide sale? The high costs of research in medicine should be
canceled out by the reduction in insurance spending (which no instead would
directly be used for research). Given that nowadays drug companies are
profitable their spending and earnings must be balanced, so would it would be
in such a system as well. The price for drugs can only go down this way. It
would not even be necessary to get rid of commercial drug companies and the
standing patents. It would just be an addition for the creation of drugs that
do not need to rely on a business model but that are focused on actually make
people healthy as cheaply as possible.

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gumby
Key factor in a farms pitch deck I wrote years ago: this indication recurs, so
patients who catch the disease will need subsequent treatment, but due to how
it happens this doesn’t qualify as a chronic condition. (Which would have made
the trials much more expensive).

There’s a bit of kabuki in pharma pitches: on one hand you have to talk about
how you care about patient suffering, on the other hand you need to
cosmetically sugar coat yet emphasize the revenue model, which is what people
really care about.

(Oh and the best pitch decks always have gory pictures in them)

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devoply
Whatever, don't do it China will. They'll make billions. You'll be pissed. No
one will shed a tear.

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adi-1203
I do believe that in biotech, you need to truly be motivated by improving
lives. It seemed to me that this article mentioned a few strategies that the
GS report advised for to sustain revenue growth that could also tie in to
making useful biotech products (e.g. finding a market that has a disease with
high incidence). That being said, this post title seems to be a tad bit
sensationalized. Certainly an investment bank of this ilk would advise towards
making profitable investments. My experience has been many people who work in
the biotech industry(albeit scientists,engineers, etc) want to help people.
Obviously, no company is going to function like a charity but perhaps not all
companies are created equally?(when comparing a financial services firm with a
biotech company). What I said is not a very nuanced look I suppose, as biotech
companies can do things like develop IP from publically funded research and
often do things that can be anti-consumer interests.

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londons_explore
Governments set the rules of markets... How could governments adjust the rules
so that developing cures makes business sense again?

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rayiner
The rules of markets are an emergent phenomenon based on human psychology. The
government operates within those rules--it can create incentives and
disincentives, but it cannot change the rules.

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spanktheuser
That’s a rather extraordinary claim. Can you cite evidence to support it?

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FlyingAvatar
I don't see what is very extraordinary about this claim.

The idea of selling of goods predates any government. In their simplest form,
how a market operates is determined by the agreement two people, a seller and
a buyer for an exchange

When restrictions are applied, how the market operates is still determined by
how people interact within those rules or by how they attempt to circumvent
them to make their exchange.

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ThalesX
I'm not sure how to feel about this. I don't have anything backing me up but I
do expect there was a clear tribe structure in place before trading really
kicked off.

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FlyingAvatar
Trading occurs in primates. You don't even need language to do it.

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zygotic12
For fucks sake - it's Goldman Sachs people. When the market was going tits up
in 2007/8 they royally shafted all of their own clients. If don't accept the
stance that the whole operation is toxic then bye bye dinosaur. (But if you
have a shit tonne of cash I recommend them). (added note: I'm pure British
(born in Zambia) any sarcasm is intentional and probably just for effect)

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antpls
What about governments create a "bug bounty" program for diseases? Every year,
the bounties for common diseases would increase, and if a firm finds a cure,
it must accept the bounty and gives the cure to the human society, free of
royalty

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brenschluss
This is a great idea.

However - how would you define a partial cure? Or reward improvements to a
cure? A cancer drug that works 60% of the time? 80% of the time? Etc.

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forkLding
Yeah but the ethical backlash against being able to cure but not curing will
be immense

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tanderson92
Will it? People die every day in the USA due to lack of access to health care.

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jammygit
That's why subscription drugs - pardon, prescription drugs- are so profitable

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gilbertmpanga12
Says Goldman Sachs the money men. Even if there's a prevention model,
anomalies are inevitable and what if anomalies are frequent would simply just
let those people die because of your profits?

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vbuwivbiu
think of all the diseases caused by externalities

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sanbor
Is capitalism a sustainable life model?

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globe1337
Nope.

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jnurmine
Why not? New patients are born every day.

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RcouF1uZ4gsC
Part of this is because the vitriol poured out on Gilead over pricing. The
cure had actually much cheaper lifetime costs than the treatment, but because
the cost was upfront people complained. How much a society is willing to pay
for stuff is a real indication of what it actually values. Society has shown
that it does not value cures over treatments. You get what you pay for.

