Thanks to recent medical and scientific advancements, cures for diseases that were once elusive are now within reach.
However, there’s one uncomfortable question that Goldman Sachs analysts brought up that’s making everyone think twice about this.
“Is curing patients a sustainable business model?”
The analysts brought up this question on April 10th in their report, “The Genome Revolution.” CNBC was the first to report on it.
For instance, analyst Salveen Richter wrote the following message in a note to clients:
“One-and-done cures enabled by gene editing are near-miraculous innovations that stand to benefit patients immensely.”
However, they also present many business challenges. Richter also wrote:
“While this proposition carries tremendous value for patients and society, it could represent a challenge for genome medicine developers looking for sustained cash flow.”
The issue with these kinds of treatments is that they offer obstacles to obtaining long-term profits when the treatment is curing the patients (aka consumers).
For instance, the reports discusses Gilead’s treatments for hepatitis C. These treatments can cure over 90 percent of patients.
In 2015, US drug sales for hepatitis C hit as high as $12.5 billion. However, as people began to be rid of the disease, sales for Gilead’s treatments fell. This year, analysts are expecting the sales to be under $4 billion.
According to the analysts:
“[Gilead] is a case in point, where the success of its hepatitis C franchise has gradually exhausted the available pool of treatable patients,” the analyst wrote. “In the case of infectious diseases such as hepatitis C, curing existing patients also decreases the number of carriers able to transmit the virus to new patients, thus the incident pool also declines… Where an incident pool remains stable (eg, in cancer) the potential for a cure poses less risk to the sustainability of a franchise.”
Cutting-edge gene therapies present the same risk. That’s because they are “one-time cures” that target small groups of patients.
This is a callous way of looking at the medicinal industry, to say the least. However, it gives a realistic, business perspective that shows that bringing the promises of gene-editing to life will take much more than just scientific breakthroughs.