Unsurprisingly, the report sparked outrage after CNBC revealed it. Richter was writing for the investment bank's clients, and it is easy to mock any companies whose profits are threatened by technological changes that will benefit millions. However, unless we adjust the economic structures around healthcare the issue she has pointed to could deprive many of the cures they need.
It costs phenomenal amounts of money to invent new medical cures and test them until health authorities deem them safe – usually at least $1 billion. Someone has to pay. For a widespread problem like hepatitis C, the issue Richter points to simply reduces mega-profits to very, very large ones. For rarer diseases, however, there may not be enough potential income to economically justify doing the research and clinical trials. MIT Technology Review has noted awareness of this issue may be why GlaxoSmithKline recently sold off its rights over some spectacular cures for very rare diseases.
Public health systems, like the ones the most wealthy countries have, will often be willing to pay enough to cure their patients that the cost of the research can be justified. After all, in the long run, the savings will usually outweigh the costs. Only the best American private insurance plans, usually unaffordable to the people who need them most, are likely to see things the same way.
One way around this is to change how trials are run, making it cheaper to bring a new treatment to market. While some ideas propose doing this in a safe manner, most of the cost-cutting would come with the danger of another disaster like thalidomide.
Alternatively, we can look beyond profits, funding the development of new treatments with either philanthropic or government money. This is already how most basic medical research is funded, but these sorts of finances are largely absent from the expensive clinical trial stages. Unfortunately, these require governments to make expensive investments that will often take decades to pay off.