Free Market Drugs and Vaccines

There is probably no sector where the impact of government-granted patent and copyrights is more pernicious than in healthcare. Drugs are almost invariably cheap to produce and distribute. The reason that some can cost thousands, or even tens of thousands of dollars for a year’s treatment is because the government grants drug companies patent monopolies. When they are producing a drug that is essential for people’s health, or possibly even their lives, the patent monopoly allows companies to charge prices completely out of line with costs.[1]

This is a case where every good progressive should be a huge proponent of the free market. If we didn’t have any patent or related protections for vaccines, we could have had manufacturers all around the world producing and stockpiling vaccines even before they were approved. (It costs around $2 to manufacture a vaccine dose, if we had stockpiled 400 million vaccines that proved ineffective and then had to throw them out, so what? The wasted $800 million is a bit more than 0.01 percent of what the U.S. government has spent on pandemic-related measures.) This would likely have meant that we could have had most of the world vaccinated by the spring, likely preventing the omicron variant and possibly even stopping the delta variant.

Also, to cut off a standard line from our friends in the pharmaceutical industry, it’s true that much of the technology of the industry is protected by industrial secrets rather than government-granted patent monopolies. This one is easily dealt with; we just make their non-disclosure agreements unenforceable. That would allow the top engineers at Pfizer, Moderna, and elsewhere to freely share their expertise with everyone in the world.

We do have to pay for research, but the patent monopoly system is a very inefficient mechanism. In addition to making drugs and vaccines very expensive, it also gives companies an incentive to carry on their research in secret, rather than sharing important findings with potential competitors.
https://cepr.net/a-better-world/