PLENTITUDE NOT SCARCITY

Don’t pamper commodities…

…let them flow. The cost of replicating anything will continue to go down. As it does, the primary cost will be developing the first copy, and then getting attention to it. No longer will it be necessary to coddle most products. Instead they should be liberated to flow everywhere. Let’s take pharmaceuticals, especially genetically bio-engineered pharmaceuticals. The cost of little pills in the drug store can be hundreds of times greater than what they cost to produce in quantity, yet many drugs are priced expensively in order to recoup their astronomical development costs. Pharmaceutical companies treat and price their drugs as scarcities. One can expect, however, that in the future, as drug design becomes more networked, more data-driven, more computer mediated, and as drugs themselves become smarter, more adaptive, more animated, the competitive advantage will go to those companies that let “copies” of the drug flow in plentitude. For example, a highly evolved bioengineered headache relief drug may be sold for a few dollars on a “take as much as you need” basis. The company makes its profits when you pay it handsomely for tailoring that drug specifically for your DNA and your body. Once designed, you pay almost nothing for additional refills. Indeed there are already a few start-up biotech companies headed this way. The field is called parmacogenomics. They are heeding the call of plentitude.

 

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This is a blog version of a book of mine first published in 1998. I am re-issuing it (two posts per week) unaltered on its 10th anniversary. Comments welcomed. More details here.
-- KK