Why Price Controls Sabotage Innovation and Health Miracles
Unlock the secrets to fostering innovation and achieving health miracles by understanding how price controls can inadvertently stifle progress, and browse options to explore how you can support a more dynamic market environment.
The Unintended Consequences of Price Controls
Price controls, often implemented with the intention of making essential goods and services more affordable, can paradoxically hinder innovation and delay the development of groundbreaking health solutions. By capping prices, governments aim to protect consumers from exorbitant costs, but these measures can lead to reduced incentives for companies to invest in research and development. This is particularly evident in the pharmaceutical industry, where the costs of developing new drugs are substantial.
According to the Tufts Center for the Study of Drug Development, the average cost to bring a new drug to market is approximately $2.6 billion1. When price controls limit potential returns on this investment, companies may divert resources away from innovative projects that could lead to significant medical breakthroughs. This not only affects the companies' bottom lines but also delays the availability of new treatments for patients in need.