I love Hayek's point you quote:
I doubt whether there exists a single great work of literature which we would not possess had the author been unable to obtain an exclusive copyright for it
But it does not cost (hundreds of?) millions of dollars to write Gravity's Rainbow.
Do you think, for example, that without the existence of IP/patents, all the medical drugs, machines, technology in general which were created in the last 100 years would in fact have been developed? Would they have if some kind of "prize system" had been in place rather than the actual IP system? (I am not asking skeptically. I really don't have any idea myself.) Truth unfolds in time through a communal process.
Why do we spend millions in drug research? May be it's just that the system is grossly inefficient. I've heard than R&D costs is 25% lawyers. And R&D costs are way smaller than marketing advertizing in the drug market.
An interesting point by Healthcare Economist:
The so-called genius awards (actually called the MacArthur Foundation fellows) are given to 25 individuals based on "their creativity, originality, and potential to be significant contributors in their fields." Recipients receive $500,000 over five years with no strings attached. One of the recipients which interests this blog is Victoria Hale (bio). She is a pharmaceutical entrepreneur who started a non-profit drug company to treat third world diseases. NPR's Marketplace ran an interview with Ms. Hale yesterday and below is an excerpt: [...]
I honnestly have very little doubt that entrepreneur and non-profit, plus government and prizes are vastly more efficient than the current system in the drug development area.
If you look at technology history, and personality of people doing the real work (see wikipedia and free software for recent examples, but they are others), I really doubt any single invention is due to IP, and I think we're missing many inventions (especially in software, some areas are just gigantic minefields even free software hero don't want to touch...).
An interesting data point is looking at what Bill Gates is doing in the drug research area. In short, he tries to have people doing research communicate openly their ideas and data sets. Why? Because in the patent-screwed world they don't and he thinks it costs a lot.
If people had understood how patents would be granted when most of today's ideas were invented and had taken out patents, the industry would be at a complete standstill today...The solution is patenting as much as we can. A future startup with no patents of its own will be forced to pay whatever price the giants choose to impose. That price might be high. Established companies have an interest in excluding future competitors.
See the 2005 version of the comment :).
Good thinking. Those whom the Gods wish to destroy They first make mad. — Euripides
...There are some new modern-day sort of communists who want to get rid of the incentive for musicians and moviemakers and software makers under various guises. They don't think that those incentives should exist... I'd be the first to say that the patent system can always be tuned...the United States has led...because we've had the best intellectual-property system.
There's a reason why european SME organisation CEA-PME is against software patents:
CEAPME (Confederation Europeenne des Associations des Petites et Moyennes Entreprises, European Union of Associations of Small and Medium Enterprises) assembles SME associations from EU member states, totalling a number of 500,000 SME members on its own and 1,600,000 together with two regular partner organisations. FFII is also an associate member of CEAPME. [...]
Ignored by the commission of course. European SME are not the general interest, USA mega-corpos are!
Remember the big pharmas sued the states that tried to copy life-saving drugs and are still doing so.
Also, aren't clinical tests indeed much more expensive for lifestyle drugs involving 5% better chance of this or that than life-saving drugs were you die if you don't take it anyway?
And I don't buy the aspirin argument, there was a somewhat recent large trial of people taking aspirin all day long, so obviously it would have been accepted today.
For Vioxx, it is established that the company deliberately withdrew critical data from the regulator, this is an horrible crime, nothing to do with the discussion here.
Last point, big pharmas will always prefer drugs you have to take until the end of your life rather than drugs that cure you. Economics 101, but often forgotten, another ill-effect of the current screwed-up IP system.
And I maintain that the FDA or EMEA criteria for safety are the same whether the drug is life saving or not. It is absolutely Kafkaian. For some "orphan" disease, they require proving the effect with double-blind trials involving more patients than you can enroll in a country the size of France, simply because there are too few people affected (they are now thinking about changing the workflow for those diseases...). And for drugs that only matter to the developing countries, they require proving that there are no interactions with prescription drugs for rich-world-only diseases.
The major preoccupation of the legislators and managers of approval agencies, is their own judicial security. So they build rules that nothing new can pass. They don't care for stuff that was approved before they took office: studies regarding aspirin are usually made by universities (big pharma doesn't pay to study public domain stuff) and since the universities have no hard cash, they make so-called meta-studies. By aggregating several other published studies primarily concerning other issues, but where patients were asked "do you regularly take aspirin", they can make findings by correlation which have a decent statistical meaning.
And if you look up most medical advisory text today, you really get a feeling that most physicians want to phase out aspirin because of oh-so-bad hemorraegic effects and stomach ulcers and-so-on... Pierre
