Reason: Will ObamaCare and patent attacks kill medical innovation?

posted at 1:01 pm on May 25, 2013 by Ed Morrissey

Most readers will probably have already heard about the horrible set of choices that Angelina Jolie faced after finding out that her DNA contained a genetic marker that almost guarantees that she will face breast cancer in her future.  Thanks to the genetic test, Jolie had an opportunity to make an informed choice about her treatment and chose a double mastectomy and later reconstructive surgery.  Not everyone can afford the BRCA-1 test and surgeries, though, which means many women at this point don’t get the options that Jolie had.  Is that an argument for ObamaCare?  Hardly, argues Reason TV:

Angelina learned about her risks because of the sort of medical innovation in which the U.S. has long been the clear leader. She benefited from a genetic test that is at the center of a Supreme Court case challenging test-maker Myriad Technologies’ right to enforce genetic patents.

The ACLU and others have sued the biotech giant, saying that you can’t patent products of nature, or even seemingly unnatural products like Angelina’s perfect lips.

Wait, says, Reason’s Kennedy — how will ending patents on tests drive innovation?  Short answer — it won’t:

Over the past few decades, America has lead the world in the number of new drugs being developed– and I’m not just talking about purple kush.

We’ve also led the way in developing a host on new technologies, too – like MRIs, CT scans, and genomic sequencing. …

Angelina’s test cost north of $3,000, well out of the price range of most women in America. But just like VCRs, cellphones, and Lindsay Lohan’s dignity, things that start out expensive and rare quickly become cheap and ubiquitous.

It’s not clear how the Supreme Court will rule in the Myriad Technologies case, but this much is more certain than the fact there’s not going to be a sequel to Salt: As Obamacare kicks in, groundbreaking genetic tests and preventative surgeries will remain elusive perks of the privileged, as innovation and patient choice are always the first things to go when bureaucracy and the state take over health care.

Wait — there isn’t going to be a sequel to Salt??  Awwww ….

Of course, that still leaves the question of the surgeries that Jolie chose.  Those provide an interesting contrast, because while mastectomies are covered by comprehensive health insurance, breast augmentation usually isn’t, although in the case of reconstructive surgery (as Jolie will need), some will.  The plastic-surgery market therefore allows for full price signaling and competition, which makes breast-augmentation surgery a lot less expensive than the mastectomies (recognizing that the latter is more complicated than the former, too).  If both markets had no third-party-payer screens on pricing signals and providers could compete directly rather than negotiate with insurers, mastectomies would still be more expensive than augmentations, but the difference would probably be considerably less — and innovation would drive the costs lower, just as they have with plastic surgery over the last couple of decades, too.  For a while, plastic surgery was the exclusive province of the wealthy and famous, too, but not any longer.

The Lasik and plastic-surgery markets should have been the model for health-care reform.  Perhaps after the inevitable failure of ObamaCare, we might give it a try.

Also, keep Angelina Jolie and all women who face this tough diagnosis in your prayers.

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