Economics of Big Pharma

Getting drug policy right depends mainly on getting that difference straight - the difference, that is, between ministering to the sick and making medicines - and grasping its implications from the start. Big Pharma's critics do not even try.Pricing is indeed the key. Whether the first pill typically costs $100 million or $1 billion to develop, replicating it costs less - a thousand times less, or perhaps a million times less. This slope - precipice, really - is far steeper than most of the other hills and valleys of economic life. It complicates things immeasurably. It also largely explains the gulf between the industry’s perception of reality and that of the critics.