Last week we wrote about a proposed bill that would push pharmaceutical firms to turn their patents over to the public domain in exchange for prizes. As we noted in the post (and the ensuing discussion), there are some serious problems with the way the current patent system sets up incentives for the healthcare industry. It really focuses research dollars into pharmaceuticals, rather than other types of technology that would not only be cheaper to make and to use, but also much more effective in helping and saving lives. It’s a fascinating area that I’ve been researching for a separate project, trying to help design better business models for the healthcare industry that will still allow for massive profits, but do so in a way that creates better incentives for actually keeping people healthy. There’s been some interesting research in this area, and I plan to share some of my own results when they’re ready (hopefully early next year).
The key, as always, is to recognize the real market that the business is in. For too long, pharmaceutical firms have believed they’re in the pill making business — rather than the “saving lives” business (even if they use the “saving lives” claim to get an emotional response when trying to push for legislation in their favor). The good news, though, is that it appears that some pharma firms are finally recognizing this. As Against Monopoly points out, the Economist notes that pharmaceutical firms are finally starting to experiment with new business models that go “beyond the pill.” They’re changing how they market and sell pills as well as starting to look into other areas of healthcare as well, from biotech to medical devices. The other interesting thing is that they’re starting to look at interesting ways to drastically reduce the costs and time of clinical trials using technology. While this won’t change their reliance on patents, it is a step in the right direction. With that diversification underway, it will hopefully be easier to show them additional new business models that can help them become more innovative, creating new opportunities to profit, without having to rely on artificial scarcity.
Originally Syndicated via RSS from Techdirt
