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December 4, 2006

What's Good for Pharma Is Good for America?

Tightening the regulatory screws on the pharmacuetical industry is high on the agenda of the new Democrat-controlled Congress, according to an article by Professor Richard Epstein in the Boston Globe.  But the industry is more fragile than it appears, according to Epstein, and there is much to fear in any new round of regulation.  The drug firms' huge profits are often tied to one or two drugs and those profits evaporate when their patents expire and generics enter the marketplace.  The FDA's increased willingness to remove drugs from the marketplace at the first sign of real or imagined dangerous side effects, and the threat of price controls, are additional constraints on research and investment in new drugs.  Future medical advances may be curtailed, according to Epstien, if these pressures make investment capital harder for drug firms to find.

JDP

December 4, 2006 | Permalink

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