Does the government have the right to demand lower prices for drugs invented by publicly founded research?
MA: It certainly does. In 1980 Congress passed the first of several laws that permit universities and the National Institutes of Health to transfer the fruits of publicly funded research to drug companies for further development and marketing. In exchange for exclusive rights, the companies are supposed to make the resulting drugs “available to the public on reasonable terms.” That provision is widely ignored. Look at Taxol – a very important cancer drug. It was developed almost entirely at the National Cancer Institute over some 30 years at a cost to taxpayers of $183 million. It was then synthesized by NIG-funded researches at Florida State University. Yet, after Bristol-Myers Squibb was given exclusive rights to the drug through an agreement with NIH, the company priced it at $10,000 to $20,000 for a year’s treatment. Hardly “reasonable terms.” Up to last year, the company had paid royalties to NIH of only $35 million on its $9 billion in sales of Taxol. AARP: if drug companies aren
