&quot;The bigger picture is that almost all hard R&amp;D takes place under the umbrella of some sort of protection from copying.&quot;<p>There is a huge difference between protection from copying, and protection from building <i>similar things that achieve the same goal</i>.  Patents are not simply &quot;protection from copying&quot;.<p>Drug patents often cover things like &quot;using the same body mechanism to achieve a desired result&quot;.<p>(Now, you can argue this is necessary to protect them, but let&#x27;s be clear - it&#x27;s not straight copying if i make a pill with a completely different chemical composition that ends up triggering the same mechanisms.  However, it likely runs afoul of their carefully drafted patents.<p>I&#x27;m also aware there are chemical compound patents that would <i>not</i> cover me doing this, but usually, when the drug companies can, they get both)<p>&quot;Intel spends billions a year on semiconductor R&amp;D, and protects it with trade secrets&quot;<p>and design mask protection (see <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Integrated_circuit_layout_design_protection" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Integrated_circuit_layout_desi...</a>)<p>&quot;Pharma companies spend billions on drug R&amp;D and protect them with patents. &quot;<p>They are also heavily subsidized, unlike your intel example.  Tax payers, for example, pay about 50% of pharma&#x27;s R&amp;D costs (and pharma includes a lot more than actual R&amp;D in R&amp;D cost).
<a href="http:&#x2F;&#x2F;www.healthnewsreview.org&#x2F;2012&#x2F;02&#x2F;the-costly-myths-about-pharmaceutical-rd&#x2F;" rel="nofollow">http:&#x2F;&#x2F;www.healthnewsreview.org&#x2F;2012&#x2F;02&#x2F;the-costly-myths-abo...</a><p>and
<a href="http:&#x2F;&#x2F;www.thefiscaltimes.com&#x2F;Columns&#x2F;2012&#x2F;02&#x2F;16&#x2F;What-Those-New-Super-Drugs-Really-Cost#page1" rel="nofollow">http:&#x2F;&#x2F;www.thefiscaltimes.com&#x2F;Columns&#x2F;2012&#x2F;02&#x2F;16&#x2F;What-Those-...</a><p>&quot;Hard R&amp;D that isn&#x27;t protected from copying is usually subsidized. &quot;<p>Pharma, one of your examples, is both heavily protected <i>and</i> heavily subsidized.  Heck, Intel gets huge R&amp;D tax breaks too.<p>In truth, most of the heavily protected stuff is subsidized by tax payers in various forms anyway.<p>The idea that these companies are out there, doing it on their own, without essentially getting most of the R&amp;D cost subsidized through tax breaks&#x2F;etc, is a huge myth.<p>We don&#x27;t have the model you propose. We have a model where it is both heavily protected and heavily subsidized.