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

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249 points randycupertino | 8 comments | 16 Nov 25 23:01 UTC | HN request time: 0.002s | source | bottom
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stego-tech ◴[17 Nov 25 00:03 UTC] No.45949690[source]▶
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.

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tptacek ◴[17 Nov 25 01:50 UTC] No.45950199[source]▶
Saying that curing diseases is a bad business model is like saying discovering the world's largest gold mine would be a bad business because you'd eventually run out of gold. The underlying argument doesn't make sense.
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1. PunchyHamster ◴[17 Nov 25 02:16 UTC] No.45950308[source]▶
It does make sense if you turn it around

"Having permanent patient by treating only symptoms is better than curing them right away"

Basically living (comfortably, or at all) as a subscription service

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2. tptacek ◴[17 Nov 25 02:42 UTC] No.45950415[source]▶
No, this is the basic naive argument I'm responding to. It's nice to have long-term recurring revenue, but customers have a very strong preference for a cure, which means the owners of cures will outcompete the owners of subscription treatments. And then to say those cure-owners are in a "bad business", again, is like saying you'd go "aw shucks" if you happened on an enormous seam of gold.
3. majormajor ◴[17 Nov 25 03:08 UTC] No.45950544[source]▶
That assumes equal ability to manage a long-revenue-stream treatment that keeps people alive enough not to die but doesn't help them enough to stop taking it. Doable for somethings. Not so much against cancer.

And it assumes none of your competitors spot the cure that you suppressed or simply didn't look for and eat your lunch by taking all those patients away from you.

If you "accidentally" came up with a single-course cure for something like Crohn's or RA while trying to create a every-three-months recurring treatment instead, would you honestly shelve it? No.

You could make an argument that the incentives discourages certain types of research, but that's assuming a certain level of foreknowledge about how to treat or cure a lot of these things that I don't think we have right now.

4. agumonkey ◴[17 Nov 25 04:41 UTC] No.45950893[source]▶
Aren't there ethical committees to avoid that? Health is not a normal business.

Goldman Sachs modus operandi is leaning too far on the parasitic side of the spectrum

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5. BurningFrog ◴[17 Nov 25 05:02 UTC] No.45950960[source]▶
That you can imagine an even better business model than X, does NOT mean X is a bad business model!
6. nradov ◴[17 Nov 25 05:15 UTC] No.45951004[source]▶
It doesn't make any sense unless there is only one drug company with a total monopoly. Even if one drug company develops a highly profitable drug which only treats symptoms, all of their competitors still have a financial incentive to undercut them by developing a cure.
7. chickenbig ◴[17 Nov 25 05:18 UTC] No.45951017[source]▶

  In July 2009, journalist Matt Taibbi invoked an indelible image when he described Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”
https://jasonzweig.com/wall-street-and-the-vampire-squid-a-b...
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8. tptacek ◴[17 Nov 25 17:41 UTC] No.45955929{3}[source]▶
It would have been nice if Taibbi's understanding of the subjects he wrote about was as vivid as his writing used to be.