Entering the doldrums of pharmaceutical research?

As the economy digs in to a long slow post-recession recovery, as lucrative patents expire, and as the debate over healthcare reform reaches a crescendo in Washington, Big Pharma is bracing itself. Up until now, the research that brings an innovative drug to market has taken upwards of a billion dollars and years through the FDA’s regulatory pipeline. The money for that research comes from profits on existing drug sales, as well as venture capital.  As an investment, drugs research has both made sense and made money. Sales of widely used drugs, protected for years, and sometimes decades, by generous patents, can earn as much as a billion dollars in under just a couple of years.

This is about to change. Republicans and Democrats, while differing widely on strategy, both concede that the rising costs of healthcare, if not regulated in one way or another, will bankrupt the coffers and leave us all without adequate medical care- this while our population ever expands into those care-needing golden years. Wall Street, always skittish around Government intrusion, is now particularly weary.

Big Pharma, usually a bell-weather in unstable economic climates, is feeling the pinch and consolidating operations, and reducing the number of potential new drugs in their pipelines. This means fewer new drugs to market.

What effect will this have on our healthcare? Expect prescription prices to drop as patents expire, and availability to be enhanced by a lessening of restrictions on imports from countries like Canada and India. That’s the good news.

On the other hand, despite recent technical advances in genetics, genomics, proteomics, and biochemistry, expect fewer innovations and fewer new treatments.

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