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If anything, option B is much more attractive because option A wont have a high enough margin. A marginal improvement only has marginal value to the consumer. They would right from the start have to price option A competitively with generics or they won't sell very many. There are issues with insurance which distort this basic mechanism, but it generally remains in place. A cure on the other hand has a very high market value, and they can charge a lot more for it.

And this all depends on the company having both options available around the same time ready for human trials. How often does that happen?






A marginal improvement only has marginal value to the consumer.


As you wrote yourself, "there are issues with insurance which distort this basic mechanism". As long as consumers do not have to pay for it (which is usually the case in developed countries), they have no reason to reject even marginal benefits.

A cure on the other hand has a very high market value, and they can charge a lot more for it.


The price one can charge for an intellectual property is limited not only by its market value, but also by ability to enforce the set price. The market value of a full cure for diabetes would be measured in trillions of dollars. Do you think governments would allow any pharmacological company to earn that much?


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melian
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