Innovation, statist-style


The Obama administration has implemented policies — both at the Food and Drug Administration and via Obamacare — that have simultaneously raised the costs of developing and approving new drugs and devices and lowered the expected returns new products in the future. Now it is allegedly worried that the pace of new innovation in drugs is decelerating, so it wants to establish a billion dollar government agency to do the work that the private sector is choosing not to do. Here is how the New York Times spins it (emphasis added):

The Obama administration has become so concerned about the slowing pace of new drugs coming out of the pharmaceutical industry that officials have decided to start a billion-dollar government drug development center to help create medicines.

Yeah, that’s a real thigh-slapper for those of us who have been following the Obama administration’s war on innovation. Much more burdensome regulatory hurdles for new drugs and devices (exceeding even the requirements of notoriously regulated countries like Germany and France)? Check. A new tax on the revenues of device and drug companies? Check. A Securities and Exchange Commission that has so raised the cost of going public that the specialty pharma and biotech companies — which do most of the real discovery work for Big Pharma — cannot raise the prodigious capital required to get new drugs in to the clinic? Check.

So, naturally, the solution is yet another federal agency. Sounds to me like an exciting new employment opportunity for university professors, who are one of Barack Obama’s last reliable constituencies.

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