Delinkage Debunked: Why Replacing Patents With Prizes for Drug Development Won't Work

February 3, 2020
  • Opponents of market-based drug development are working with intergovernmental organizations to replace intellectual property rights with government-managed prizes as the main incentive to drive biopharmaceutical innovation.
  • Advocates claim “delinking” drug prices from R&D investments will make innovative medicines far cheaper. But the truth is it would almost surely lead to less new drug development and slower progress in improving human health.
  • For prizes to work, governments would have to replace $180 billion per year in private medical R&D with taxpayer funds—unlikely, given the budget challenges many governments face and the fact many of the benefits would flow to other countries.
  • The true value of a new medicine is hard to measure before it is created, so prizes could be underfunded. That would lead to fewer companies taking the risk of investing in expensive R&D, and hence to fewer new medicines.
  • Handing over significant control of global biomedical R&D flows to government bodies would be a recipe for inefficiency and for politicizing drug development.
  • The current market-based system delivers a tremendous amount of biomedical innovation. Intergovernmental organizations should focus on solutions that improve it, including expanding drug access, rather than promoting flawed concepts like delinkage.