Is a Medical Research 'Nuclear Winter' Coming?
"I've got to admit it's getting better, a little better all the time," sang Paul McCartney, in 1967. Sgt. Pepper's Lonely Hearts Club Band landed squarely in the middle of one of the most rapid periods of technological progress in all of human history, punctuated by the first human moon landing two years later.
But man last set foot on the moon 46 years ago. As easy as it is to assume economic progress is inevitable, the many endlessly long pit-stops of stagnation along human history tell otherwise, and today's economists are increasingly scrutinizing a stalling rate of innovation.
Consider that for 800 years between 1000 A.D. and 1800, standards of living barely budged. Talk about trickle down: economic growth was .05%. Twenty-five generations after the time of Viking raider Leif Eriksson, Macbeth, the murderer of Duncan, and William of Normandy, the people of 1800 were one-and-a-half times wealthier.
"Between 1820 and today, world per capita real income grew 20 times as fast as it did in the previous eight centuries," James Surowiecki wrote in "Better and Better: The Myth of Inevitable Progress".
Increasingly, it appears that some areas of innovation are more vulnerable to stagnation than others. The printing press made publishing possible, the Internet made it practically free, and it will continue to usher in dramatic changes (not all of them welcome) for decades.
Other parts of our world, in the most powerful and wealthy nation in the history of man, seem stuck, irredeemably mired, invincible to reform. For example, education stagnates, but teachers unions become more entrenched still.
What seems apparent to me is that medical research increasingly faces a unique and precarious risk of slipping from its role mostly on the innovative side ledger into a dark and difficult to recover from a period of deep stagnation, a risk arising almost entirely from politics.
Drug research faces a menacing political environment. The opening bids by Democratic presidential candidates, for example, on drug policy have been ominous.
Elizabeth Warren not only wants the government in the drug manufacturing business, but she's also proposed authorizing it to flaunt patents whenever it sees fit, torching hundreds of years of intellectual property law in the process.
Warren's proposal is only slightly worse, from the perspective of drug companies funding an R&D process that costs billions per new medicine brought to market, than one initially proposed by the Trump administration and quickly championed by Senator Bernie Sanders.
The Trump FDA would establish an international "price index" based on "prices" the governments of European single-payer nations set. These are no more a price than the "protection" amounts nervous convenience store owners hand over to the mob; single payer states will simply steal the drugs they want if companies (usually American) don't comply.
The peril facing medical research is acute because, besides its companies producing the vast share of new medicines, the United States is the world's most important drug market by a large share. If the world were a patient, she'd be very sick: the cancer of socialized medicine has spread far and wide, leaving only a few relatively free markets left.
Somehow, this has been seized to build momentum for pushing the final domino over the US market. Everyone else is stealing medicine, why can't we?
Other problems darken the skies as well. Increasingly risk-averse regulations have dramatically increased the cost and time spent bringing new medicines to market. "It would not be an exaggeration to say that people are dying in the cause of making medicine safer," science journalist Michael Hanlon wrote in a 2014 essay investigating "why has progress stalled?"
America's own Obamacare law, not to mention its many overseas variants (some much worse), introduce inefficiencies and mismatched incentives into the broader healthcare market on a daily basis, all while the idea of government-funded care becomes more deeply ingrained.
The crushing cost of funding an ever-less-efficient health care sector also introduces perverse incentives on the part of politicians trying to keep the system afloat. Notably, the House Democrats top drugs bill from the last Congress, HR 6550, included the "budgetary impact" of paying for new drugs as a reason a future HHS secretary could cite in deciding to void its patent to steal the IP. And history is of course replete with examples that rationing is an inevitable result of distributing resources via central planning.
Progress is inevitable until it stops. The financial underpinnings of the medical research pipeline are under attack, and they are vulnerable. For those of us planning to stick around a few years, here's to hoping that technological progress prevails against the dangerous populism of Elizabeth Warren and Bernie Sanders.
Mike Daugherty is CEO and Founder of LabMD, a cancer detection laboratory based in Atlanta, Georgia. He is author of The Devil Inside the Beltway: The Shocking Expose of the US Government's Surveillance and Overreach Into Cyber-security, Medicine and Small Business.
