a system built by and for Wall Street, resting on a foundation of $33 billion in annual taxpayer-funded research

6-28-18   It’s a system built by and for Wall Street, resting on a foundation of $33 billion in annual taxpayer-funded research.  Generations of lawmakers from both parties bear responsibility for allowing the drug economy to become a racket controlled by hedge funds and the Martin Shkrelis of the smaller firms….

  Toward the end of the 1960s, new mechanisms hatched out of the National Institutes of Health would transform the industry and drastically expand the opportunities for private profit at the expense of the public interest, ushering in a post-Biddle age of virtually unrestricted industry access to taxpayer-funded science.

  In 1968 the NIH’s general counsel, Norman Latker, spearheaded the revival and expansion of a program that had, in the years before the government spent much on science, permitted nonprofit organizations—universities, mainly—to claim monopolies on the licenses of medicines developed with funding from NIH.  Called the Institutional Patent Agreement program, it effectively circumvented rules that had been in place since the 1940s, not only making monopolies possible, but also greatly expanding their terms and limits, giving birth to a generation of brokers whom universities relied on to negotiate newly lucrative exclusive licensing and royalty deals with pharmaceutical companies….

  the market was evolving to include more opportunities for speculative investments and bigger IPOs.  Venture capital firms in the 1970s began investing heavily in biotech; soon young biotech firms, established drug makers and Wall Street were pushing for changes in licensing and patent law to make these investments more profitable. …

the Supreme Court in 1980 decided a GE scientist named Ananda Chakrabarty could patent genes and genetically engineered organisms, fueling a gold rush in biotech and further sweetening pharma as a destination for investors. “The Chakrabarty decision provided the protection Wall Street was waiting for, encouraging academic entrepreneurs and venture capitalists to explore commercial opportunities in biotech,” says Oner Tulum, who studies the drug sector at the Center for Industrial Competitiveness.  “It was the game changer that paved the way for the commercialization of science.”  Presidents from Reagan through Clinton continued to push legislation friendly to pharmaceutical manufacturers.  https://newrepublic.com/article/149438/big-pharma-captured-one-percent