Goldman Sachs asks in biotech Report: Is curing patients a sustainable business? (2018)

Profitability of Cures and Patent Dynamics

• Multiple comments argue curing patients can be extremely profitable, citing blockbuster examples (e.g., Hep C cure, major cancer drugs) generating tens of billions in revenue.
• “Unsustainable” is seen as a bad framing: all patented drugs (cures and chronic treatments) are inherently time-limited due to patent expiry and generics, so firms must continually find new products anyway.
• Some note pricing for certain cures was “scandalous” and triggered investigations, but others counter that high prices are what enabled those profits and further R&D.
• Analogy is made to oil/mining: one finite “deposit” can still be a fantastic investment even if it eventually runs out.

Market Incentives, Competition, and Cartels

• A recurring theme: if a market is full of chronic treatments, any firm that launches a cure gains huge competitive advantage; coordinated withholding of cures is described as an unstable equilibrium.
• Patents and time limits incentivize bringing cures to market rather than hiding them; sitting on a patented cure would forfeit revenue and eventually allow competitors free use.
• Some push back, raising concerns about cartels, regulatory capture, and buyouts where firms purchase cures to protect existing treatment franchises.
• Conspiracy-style ideas about systematically suppressing cures are generally rejected as implausible given the number of independent labs and the dynamics of competition.

Capitalism, Ethics, and Role of Government

• Several comments argue that for-profit medicine misaligns incentives: recurring treatment revenue can be more attractive than one-shot cures (“health as subscription”).
• Others emphasize higher-order societal benefits of cures (longer, healthier lives, more economic contribution) that aren’t fully captured by private firms—classic externality problem.
• This leads to advocacy for socialized healthcare or stronger government role in funding R&D, especially for antibiotics, rare diseases, and unprofitable cures.
• There is debate over whether “economic value” should be the justification at all; some insist healthcare should be provided on moral grounds, not just ROI.

Industry Structure and R&D Risk

• One detailed thread explains the biotech pipeline: university research → VC-backed biotech → pre‑revenue IPO → eventual acquisition by big pharma that handles late-stage trials, manufacturing, and global roll‑out.
• Scientific and clinical risk is largely borne by startups and public investors; big pharma competes to acquire successful assets, including cures.
• Because of this structure, as long as the market isn’t a tight oligopoly with captured regulators, there are strong incentives to develop and commercialize cures.

Alternative Business Models and Policy Ideas

• The Goldman report’s own “solutions” are noted: focus on large markets, high-incidence disorders, and continuous portfolio expansion; genetic and personalized medicine can generate a continuing stream of new cures.
• Suggestions include “post-scription” models (small lifelong payments after a cure), insurer structures where cures can be priced against lifetime treatment costs, and tax/market designs that reward social outcomes (e.g., reduced disease incidence).
• Some analogies to public transit highlight that activities can be socially valuable but privately unattractive, implying need for mixed public–private or redesigned incentive systems.