Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

I feel kinda bad for the writer, because it's a good question: no, curing patients is not a good business model, just like public transit is not a good business model.

What a lot of folks neglect are N+1-order effects, because those are harder to quantify and fail to reach the predetermined decision some executive or board or shareholder has already made. Is curing patients a bad business model? Sure, for the biotech company it is, but those cured patients are far more likely to go on living longer, healthier lives, and in turn contribute additional value to society - which will impact others in ways that may also create additional value. That doesn't even get into the jobs and value created through the R&D process, testing, manufacturing, logistics of delivery, ongoing monitoring, etc. As long as the value created is more than the cost of the treatment, then it's a net-gain for the economy even if it's a net loss for that singular business.

If all you're judging is the first-order impacts on a single business, you're missing the forest for the trees.

> As long as the value created is more than the cost of the treatment, then it's a net-gain for the economy even if it's a net loss for that singular business.

This is precisely the type of work that is best funded through government: Work that can be net positive for the populace but doesn’t have a viable business model attached.

There’s another layer to consider even with government-driven efforts: Resources are never infinite. The number of potential R&D opportunities exceeds available research dollars and even human personnel many times over. There comes a point when you need to allocate finite resources to the efforts that provide better cost to benefit ratios. I don’t think it’s helpful to go full hardcore utilitarian, but the reality can be that the cost of coming up with a cure for a rare genetic condition that impacts only a small number of people might be better spent on research toward a drug which incrementally reduces heart disease, for example.

Finding permanent cures for rare conditions is a heart-warming idea, but in reality it’s a lot harder and more expensive than most people assume. Likewise, when people become enamored with these ideas of finding permanent cures for rare genetic ideas they can be missing the big picture that it may not be one of the better uses of that money even if you took raw capitalism and investment dollars out of the picture. There are so many more opportunities for widespread health improvement in the boring conditions and even lifestyle diseases than in hypothetically curing the rare genetic conditions. It may not feel as heart-warming to talk about things like reducing obesity, but we’re witnessing an incredible society-wide health improvement with GLP-1 drugs that is orders of magnitude more benefit across society than something like curing a rare genetic disease.