ELI5: Why did it take so long for a cheap drug company like Mark Cuban’s to exist in America?

It's been a long time since I worked in research in this area, and I worked in the UK, so I can't provide a comprehensive answer, but...

To develop a new medication requires a seriously large investment. There are very strict procedures to run clinical trials on new drugs and it is expensive. You have to patent the new drug, and then the timeframe between getting your patent, thoroughly testing the drug so that it is market approved, and then turning a profit on it once it reaches market before the patent expires is pretty insane. It is very competetive and a high risk investment - what if it doesn't pass clinical trials? That investment might be largely worthless. Once the patent expires then any competitor can sell the drug at a fraction of the cost. So drug companies require a serious amount of capital and investment to get going. This would be difficult for start-up companies.

It would come as no surprise that a philanthropic billionaire would be the only real competitor to pre-existing large companies. However, I assume the drugs that he sells have had their parents expire, or he wouldn't be allowed to sell them without making a deal with the drug company. So, it sounds as though other factors must be involved. In the UK, medications with expired parents are sold at a low prices, e.g. a pack of paracetamol costs about 20p. I don't know how this compares with other states.

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