Ebolanomics

Ebolanomics is the title of this article from the New Yorker. 

This is something that's been talked about off and on for decades — an updated/global version of orphan diseases (diseases that are rare and hence there's no financial incentive for pharmaceutical companies to develop a cure).

The world has been terrified/fascinated by the Ebola virus for at least 25 years, and yet no drug has ever been approved to treat it.  The reason, of course, is that most Ebola victims had the nerve to be poor and live in an undeveloped country.

Two million people a year die of malaria and tuberculosis, but the pharmaceutical industry puts more time and money into treating high cholesterol.  Another example:  Out of the roughly 1,500 drugs that were put on the market between1975 and 2004, exactly ten of these drugs were designed to treat Dengue and Chagas disease, which together have stricken more than a billion people worldwide.

This article isn't lashing out at the pharmaceutical industry.  We need a different business model that would make it profitable for a company to develop new drugs even if these drugs won't be used by millions of rich people.  Instead of being granted a patent on their drugs and charging sky-high prices, companies would be given a “prize” for the new drug they've developed.  From the linked article:

“The government would make a payment or a stream of payments to the company, and in exchange the company would give up the right to sell the product. The drug company would get paid, and would avoid all the expenses of trying to push a new product...Society would get a new drug, and public-health officials would be able to control how it was promoted and used.”

These prizes have already been widely used for numerous technological breakthroughs.  Just one example:  an arsenic filter for drinking water.  Prizes are:

“...cost-effective, since you have to pay only if the product works. They’re well suited to encouraging investment in public goods—like antibiotics and vaccines—where the benefits of an innovation aren’t reaped only by those who use it. (My family is safer if yours is vaccinated.) They rely on existing infrastructure. And, in economic jargon, they harness market forces by 'pulling' research into neglected areas.”  [from the linked article]

I think it's worth a try.