Stem Cell Veto: Patently Absurd?

Like just about 99.9% of the people that are taking a position on George Bush's stem cell veto, I really don't know much about the science involved. I'm not a biologist or biochemist, but I work in finance. What is clear is that 1) Bush stopped federal spending on embryonic stem-cell research; he didn't stop privately-funded research, and 2) it doesn't appear as if cures to major diseases like Alzheimer's are imminent. But they could happen in the future.

Most free-marketeers will say that research is the domain of private industry, not of the government, so we should just let the market work, and leave the government out of the business of research. Normally, I'd agree, but I'm not so sure I agree here.

Private companies engage in research if they can profit from the research. Pfizer spends billions of dollars researching potential new drugs because they hope that once a new drug is approved, it'll be able to sell that drug and make back its investment. After a drug is on the market for a few years, its patent expires and the drug goes generic, meaning that any pharmaceutical company can manufacture and sell the drug.

Venture capitalists can risk their money and their investors' money on investing in pharmaceutical start-ups that may have a promising new drug. With the market evaluating potential risks and rewards, the public benefits by being able to buy drugs like lipitor or viagra that were previously unavailable, and the drug companies that developed these drugs benefit their shareholders.

Now, I don't know if stem-cell research can lead to patentable results. If you find the cure for cancer or Alzheimers or whatever by using stem cells, can you patent that? It seems that the Wisconsin Alumni Research Foundation (WARF) holds some really broad patents on stem-cell research, but it is unclear if these patents are going to hold.

If new drugs or therapies or whatever that result from embryonic stem-cell research are patentable, then my position would be that the US government should not get involved in the research projects. This country has thousands of venture capital companies willing to deploy their money in various endeavours. If it's really possible that embryonic stem-cells can be used to cure cancer or Alzheimer's, and the result is patentable, there should be no shortage of venture capital available.

If, however, the result of stem-cell research will be such that it is not patentable, then it is going to be the domain of the government to do the research. Without patents, the research simply will not be done by private industry, since if company A spends $3 billion and comes up with a solution, company B will immediately copy the solution. No company will be willing to take on the risk.

So if the research results won't be patentable, then we need to evaluate the life-and-death questions about embryonic stem-cells, and I'm certainly inclined to side with the advocates of more stem-cell reseach, and I'm also willing to let the government fund most of the research.

I don't feel this way just about embryonic stem-cells, but pretty much about all other types of research. If there is research that will likely or even possibly lead to the improvement of mankind, but which can not be profited from, let the government do it. Obviously, we need to work out what risk/reward quotient works. With patentable research, keep the government out. Let industry and the free market work, if possible.