Why haven't we eradicated more diseases?: Pharma incentives

The subscription model

I spent twelve years in drug development before I switched to policy. I didn’t leave because the science was bad. I left because I finally understood what the science was for.

The pharmaceutical industry’s R&D pipeline optimizes for return on investment. That’s not a criticism — it’s the operating system. A drug that manages a chronic condition in a wealthy population generates revenue for decades. A drug that cures a disease concentrated in sub-Saharan Africa generates revenue once, in a market that can’t pay. Malaria kills 600,000 people a year, almost all children. Total malaria R&D: $800 million. Pfizer spent more than that on a single vaccine trial for a disease that rich countries also get.

The numbers aren’t hidden. The WHO estimates that diseases of poverty receive about 1 percent of global pharmaceutical R&D spending despite accounting for a significant share of global disease burden. We don’t lack the science. We lack a business case.

What would actually work

Advance market commitments — where donors guarantee a purchase price before the drug exists — got us a pneumococcal vaccine for developing countries. It worked. Then the model wasn’t replicated at anywhere near the scale needed. The political will for one commitment existed. The will for twenty doesn’t, because each one requires governments to spend money now for outcomes decades away.

The public health camp wants more funding. They’re right. But more funding into the existing pipeline produces more thirty-percent-effective vaccines thirty years late. The pipeline itself needs restructuring. The effective altruists get this — their cost-effectiveness models expose how misallocated the money is. But even they underestimate how hard it is to change a $1.6 trillion industry’s incentive structure from the outside.

Where we concede ground: The industry also produced the mRNA vaccines in under a year. When the incentive aligns, it works.

What would change our mind: A major pharma company funding eradication-stage research without a guaranteed purchase commitment.

Read the full synthesis: Why haven’t we eradicated more diseases?