Monday, June 12, 2006

Push, Pull or both?

The system for funding R&D today is a mixture of public sector/donor directed research grants and contracts (like the NIH or CDC in the United States), known as “push” mechanisms, and incentives like patents, known as “pull” mechanisms, that reward only successful projects. A new system needed both approaches – push and pull. It also needed both non-profit and for-profit players.

The hard part was to reinvent the “pull” mechanism so that it was no longer linked to marketing monopolies and high drug prices. The main idea that emerged from this this exercise was the creation of a system of cash rewards for successful drug development projects, mostly based upon evidence of impacts on incremental health care outcomes.

Aventis was told that it's business could be broken down into three components. The manufacturing and distribution of medicines could easily and more efficiently be done by the competitive generic drugs industry, as it is today in the United States after patents expire, and has it has been done in India, a country with pharmaceutical product patents, for the past three decades.


Post a Comment

<< Home