Exactly, they try to insist on perfection in Rx drugs and devices, but in reality you have huge error rates in medicine all over the place. In the meantime, the FDAs goal of perfection just becomes a huge block that saves thousands of people from bad drug effects, while not saving millions from the ravages of illness and injury. The FDA does not understand the concept of "good enough". They have pushed costs to ridiculous levels. In the meantime, they do a crappy job of regulating food, and all the supposed natural stuff gets unregulated (which I'm not necessarily complaining about).
This whole idea that you need to know the mechanism of action of a drug is pretty hard to fathom too. To me it either works and helps in some % of cases or it doesn't. Knowing exactly what the body does with it is a nice research goal, but not exactly essential to knowing that it is safe and efficacious.
Hell, what really pisses me off is the stupid FDA bullshit with stuff like Guaifensin. This is an expectorant to help get crap out of your lungs when you have a respiratory infection. It is one of the main ingredients in Triaminic syrup, the stuff everybody gives to babies because it is so benign. But, you cannot buy a tablet form of Guaifensin except as a prescription. You can only get it over the counter in some sickly sweet cough syrup formulation. So, I end up having to get an Rx and pay through the nose (at least my insurance does) for a drug that can be sold over the counter in a syrup but not a tablet form. Just stupid, just a way for the drug companies to milk the regulatory scheme for a high margin on an old drug. Bad marketing though if you ask me as almost no one uses the prescription form of the drug, but it really is effective for clearing your lungs and I think would be used by millions if they would just put out an over the counter pill form. They'd rather have a small market high margin product than a large volume commodity I guess.
The FDA needs a new commissioner who understands that delay costs lives and that perfection is overkill. Just like the software industry, the drug industry needs to rely more on its customers for the beta testing. It invariably happens anyway as you can't test for everything, just look at Phen-Fen.
The VD Model will keep on keeping on. I think that our best hedge is broader diversity of stocks in the portfolio. I'd rather see about 30-50 companies in the basket, with no more than a 5% weighting in any company, and a typical position being in the 2% range. Play the VC way, spread the risk and let a few winners fund the many losers and walking dead. The narrowness of the current portfolio lends itself to more or a precise stock picking, but with the huge uncertainty and crappy info on biotechs, particularly those dealing with the FDA, I think that more of a broad holding index approach might be better and smooth out some of the volatility. Geez, in 6 months we've been up 100% and then given it all back again. Just a bit volatile.
Thanks everyone for you support and commentary!
Rocketman |
