USA Today reports the results of a new study that indicates that by providing for the widespread use of the cholesterol lowering drug Crestor, many more deaths can be prevented. The article reports that the cost is $500,000 per life saved. This actually misrepresents the cost to society. The vast majority of this cost is not the cost of producing and distributing additional doses of Crestar. Almost all of this cost is the economic rent that the manufacturer will earn as a result of its patent monopoly. The actual cost of producing the addition drugs is probably not more than $5,000 per life saved. While the patent system finances research into the development of new drugs, it is an extremely inefficient mechanism for supporting research. It would be helpful in an article such as this to be clear on what the real costs to society would be of more widespread use of Crestar, if the study's results prove accurate.
--Dean Baker