November 6, 2013

Courts as market makers

Recent decision invalidating Myriad patents has had immediate results. The market of genetic tests on breast and ovarian cancer has new entrants. The price of the test has decreased 40% (!) in just four months after the resolution. More entrants are expected in the next future for more tests.
The question is still the same, is there any clear cost-effectiveness analysis available for such tests? Why homebrew tests (LDT) are beyond any regulation? Does any regulator care about all this issues?. The answer is: up to now, we can't see any efforts. Patents create artificial monopolies, courts may create markets when invalidate patents,  but patients are concerned about health improvement and value. In an asymetric information environment, the regulator can't take permanent holidays. Overdiagnosed population doesn't necessarily mean healthier population.

 Forbes Healthcare Summit 2013
Insurance Companies Enter A New World