Capitalizing a Cure: How Finance Controls the Price and Value of Medicines

217 Pages·2023·2.973 MB·English

by  Victor Roy

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Capitalizing a Cure takes readers into the struggle over a medical break-
through to investigate the power of finance over business, biomedicine,
and public health. When curative treatments for hepatitis C launched
in 2013, sticker shock over their prices intensified the global debate C
over access to new medicines. Weaving historical research with insights A
from political economy and science and technology studies, Victor Roy P
demystifies an oft-missed dynamic in this debate: the reach of finan- I
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cialized capitalism into how medicines are made, priced, and valued.
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Roy’s account moves between public and private labs, Wall Street and cor- I
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porate board rooms, and public health meetings and health centers to trace
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the ways in which curative medicines became financial assets dominated by
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strategies of speculation and extraction at the expense of access and care.
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Provocative and sobering, this book illuminates the harmful impact of allow-
ing financial markets to determine who heals and who suffers and points to
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the necessary work of building more equitable futures. 

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“An important voice on the links between finance and health ecosystems, Victor
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Roy makes a valuable contribution to building an economy that is based
C A P I TA L I Z I N G
on providing health for all.”—Mariana Mazzucato, author of The Value of R
Everything: Making and Taking in the Global Economy and Chair of the WHO E
Council on the Economics of Health for All 
“This book is a riveting read that will strike fear in the heart of anybody who AH A C U R E
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cares about the right to health or thinks that the drive for profits should not DW
supersede democracy or human need.”—Salmaan Keshavjee, author of Blind V F
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Spot: How Neoliberalism Infiltrated Global Health LIN
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“The best piece of nonfiction I have read in a long time. This book offers a EN
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fantastic, relevant, and necessary case study to understand how the finan- FE H OW F I NA N C E C O N T R O L S
cialization of the economy has affected the organization of industrial sec- M C
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tors.”—Marc-André Gagnon, Professor of Public Policy and Political Econ- DN
omy, Carleton University    IT
CR T H E P R I C E A N D VA L U E
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Victor Roy, MD, PhD, is a family physician, sociologist, and fellow in the S TH O F M E D I C I N E S
National Clinician Scholars Program at Yale University. E
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A free ebook version of this title is available through Luminos, University of California C
Press’s Open Access publishing program. Visit www.luminosoa.org to learn more. E
university of california press ISBN: 978-0-520-38871-0 V I C T OR R O Y
www.ucpress.edu
Cover illustration: © iStock. 9 780520 388710
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Capitalizing a Cure

Capitalizing a Cure
How Finance Controls the Price
and Value of Medicines
Victor Roy
UNIVERSITY OF CALIFORNIA PRESS
University of California Press
Oakland, California
© 2023 by Victor Roy
This work is licensed under a Creative Commons [CC BY-NC-ND] license.
To view a copy of the license, visit http://creativecommons.org/licenses.
Suggested citation: Roy, V. Capitalizing a Cure: How Finance Controls the
Price and Value of Medicines. Oakland: University of California Press, 2023.
DOI: https://doi.org/10.1525/luminos.141
Cataloging-in-Publication Data is on file at the Library of Congress.
ISBN 978-0-520-38871-0 (pbk. : alk. paper)
ISBN 978-0-520-38872-7 (ebook)
28 27 26 25 24 23
10 9 8 7 6 5 4 3 2 1
Contents
Chronology of Key Events vii
Preface: Pandemics, Wall Street, and the Value Playbook ix
Introduction: The Politics of Drug Pricing and the Value of a Cure 1
Risk, Value, and the Politics of Justification in the Drug Affordability Crisis 4
Diagnostic Blind Spots in the Price of a Cure 7
The Missing Diagnosis: Financialization 9
Opening the Black Box of Price and Value: Capital, Assets, and Power 11
A Sociological Account: The Case of Sofosbuvir-Based Treatments 17
Chapter Outlines 21
1. Capitalizing Science: Public Knowledge into Pharmaceutical Assets 23
Overcoming a Technological Hurdle: The Replicon Tool and an Entrepreneurial State 24
The Triple Helix: Public and Private Science in the Launch of Pharmasset 31
Sofosbuvir as an Asset and a Relay Race of Financialized Capital 40
Pharm(asset) 49
2. Capitalizing Drugs: Shareholder Power and the Cannibalizing Company 51
Life Science amid Shareholder Power 52
Chasing the Golden Snitch, and a Hepatitis C Gold Rush 59
The Cannibalizing Company: Following Gilead’s Hepatitis C Money 67
From R&D to M&A and Buybacks 72
vi Contents
3. Capitalizing Health: The Struggle over Value and Treatment Access 74
Health as a Financial Asset: Setting and Justifying a $1,000-a-Day Price for a Cure 75
Rationing versus Public Health: The Politics of Value and the Crisis
of Treatment Access 85
The Patient Cliff: The Limits of a Cure as an Asset 96
Pharma(value) 104
4. From Financialization to Public Purpose for Health 106
When Medicines are Financialized: Mechanisms, Mystifications, and Outcomes 108
Toward a Public-Purpose System 121
Conclusion: Reckoning with Pharmaceutical Value in Crisis Times 131
Acknowledgments 137
Appendix: Overview of Data Sources 141
Notes 145
References 163
Index 193
Chronology of Key Events
Late 1960s Scientists at US federal health agencies begin a decades-long effort
to elucidate the clinical and public health consequences of viral
hepatitis.
1987 Gilead Sciences is founded in Silicon Valley.
1989 The Hepatitis C virus is identified by scientists at Chiron, the
National Institutes of Health (NIH), and the Centers for Disease
Control and Prevention.
1991 Chemist Ray Schinazi begins receiving public investments for
nucleoside research.
Late 1990s Without cell culture techniques to grow the virus in labs, drug
companies struggle to test hepatitis C compounds.
1998 Pharmasset is founded out of Emory University by Ray Schinazi
based on research funded by NIH and the Veterans Administration.
1999 Pharmasset receives the first of 16 NIH grants.
2001 A publicly funded lab and company led by virologist Charlie Rice
begins distributing replicon technology, enabling drug companies
to test compounds against hepatitis C.
2002 Roche makes $2 billion on interferon-based treatments for
hepatitis C priced at $36,000 per treatment course.
2004 Pharmasset completes raising about $55 million in venture capital
funding.
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