I will try to make one quick concluding point in my exchange with Roderick on patents. I realize that he doesn’t like my system because it requires that we tax people to pay for the research. But if he will agree for a moment not to make his perfect the enemy of his good, let me compare the system that I proposed with the current system.
The country is currently spending about $250 billion a year on prescription drugs, with just under $90 billion coming through various government funded programs. Let’s imagine that we eliminate patent protection tomorrow. We would be able to buy the same drugs for around $25 billion a year in a world in which all drugs could be sold as generics.
Now we still have to pay for the research. My ballpark guesstimate is that we could replace the research done by the pharmaceutical industry with $30–$40 billion of publicly funded research (this is approximately equal to what they claim to spend).
Now, if we hypothesize that this is in fact the case, which is better: a world in which we tax people $90 billion dollars to buy drugs at patent protected prices, or a world in which we tax people $30-$40 billion to pay for research, and all drugs are sold at market prices?
I know my answer to that question, I’m interested in Roderick’s.