On Wed, 2006-10-04 at 12:32 -0700, Thomas Lord wrote:
> Let's assume that all players are looking at a financial market in
> which an annual rate of R is a good return.
Forgive me for my ignorance, but can you explain how do you come to the
following formula (and why you calculate the price of the patent with
it?):
> Third parties should bid:
>
> PRICE = $A / (1 + R)^20
Also can you show me where you get the numbers in the following
reasoning?
Where does the 1000$ come from?
Where do you get the pharma spending numbers?
2-3 orders of magnitude more than 81B$ is in the order of trillions!
> Here:
>
> 300,000,000 people in the US
>
> let's call that
>
> 130,434,783 households
>
> let's be wildly optimistic and say that each spend $1,000
> per year on patent medicine:
>
> $130,434,783,000 on patent drugs (before)
>
> and that half of those expenditures simply go away thanks
> to 50% of new drug patents becoming immediately generic:
>
> $65,217,391,300 on patent drugs (after, also the amount saved)
>
> that savings is a 25% subsidy on how much research?
>
> $81,521,739,125 (max amount of pharma research at which taxpayers win)
>
> And you do understand that actual pharma research spending
> is 2-3 orders of magnitude larger than that, right? Taxpayers
> will go bankrupt.