This week's Economist has a detailed article on the use of open source methods in the world of bio-pharmaceutical research. It's currently available without registration or subscription, and I highly recommend that you go read it.
We've talked about "open source biotech" a number of times in the past (see in particular "Open Source Biology" and "Democratizing DNA", and more broadly "Redistributing the Future" and "Open the Future"), but this article approaches the idea from a somewhat different perspective, focusing on the (relatively) narrow issue of drug research:
Open-source research could indeed, it seems, open up two areas in particular. The first is that of non-patentable compounds and drugs whose patents have expired. These receive very little attention from researchers, because there would be no way to protect (and so profit from) any discovery that was made about their effectiveness. [...]
The second area where open source might be able to help would be in developing treatments for diseases that afflict small numbers of people, such as Parkinson's disease, or are found mainly in poor countries, such as malaria. In such cases, there simply is not a large enough market of paying customers to justify the enormous expense of developing a new drug.
The article discusses the challenges of adopting an open source-style research method, from logistics to issues of patents vs. copyright (in short: copyright makes it easier to put "reciprocal openness" requirements on a collaborative creation, while patents generally work better as "public domain"), but strongly supports the idea that expansion of the open source methodology would be a good thing -- no "open source terrorist" boogeymen appear.
It's very clear that the open source meme is taking hold in the world of bio-pharma research as symbolizing doing work that needs to be done without worrying about bottom-line demands:
Dr Lansbury refers to the work as not-for-profit drug discovery, but he sees direct parallels with the open-source approach. For one thing, his group places much of its data in the public domain. Secondly, though the research is mainly happening among different research labs within the confines of Harvard at the moment, the goal is to involve other scientists around the world. Only through this sort of collaborative, distributed approach will treatments be found for these diseases, he says. As for the intellectual property that may be created, the goal is to use patents only to license treatments cheaply to pharmaceutical companies to ensure a supply of drugs at low cost. But the most important thing is to discover the drugs in the first placesomething commercial drug-development seems unable to do.
Open source, the idea, is bigger than software, is more than an alternative economic/production model. Read the article, and ask yourself: in what other realms of research and development could the open source concept be applied?
Open source cannot be non-profit. The reason why many open source software projects work is because the people and companies working on these things find this to be the most economical way of getting some innovation done. If UNIX was free, or very cheap, would there have been Linux? As a company, I'm willing to donate manpower to open source because it furthers my interest. So I expect those who will contribute to open-source bio-pharma will not be drug companies, or even government labs, but more possibly insurance companies - hoping to free themselves from the so-called tyranny of the drug developers.
There's no reason that a lack of patent or copyright necessarily means something is "non-profit." A patent is not necessary to profit from innovation. The first firm to introduce an innovation will derive a producer surplus, or quasi-rent, until the innovation is adopted by its competitors. A patent simply allows a firm to obtain further profits through a state-enforced monopoly.
An FTC study a while back found that over 80% of new products and techniques would have been developed even without patents, just out of a need to stay competitive. (Hearings on Global and Innovation-Based Competition. FTC, 29 November 1995, at http://www.ftc.gov/opp/gc112195.pdf)
Of course, drugs were the one area in which a majority would not have been developed without patents. But even there, consider how much of the development cost is artificial. Until a generation or so ago, the FDA approval process only screened out positively harmful drugs; it didn't require proof of efficacy. The change made a huge difference in the cost of development. IMO, the FDA approval process should, at the very least, be scaled back to require proof only that a drug is non-harmful. Efficacy, whether of laetrile, the hoxsey formula, or graviola, is between me and my medical practitioner. As somebody said, it's my body.
Then, too, about half of Big Pharma's R&D expenses are paid by the taxpayer, so a good part of their whining about "cost recoupment" is a case of crying one's way to the bank.
Finally, I wonder how many effective alternative remedies are crowded out by the White Coat Mafia's "standards of practice," precisely because they aren't amenable to patenting and therefore don't make it into a med school curriculum heavily influenced by the drug industry.