[lotsofpulp]

What does that have to do with anything? “Develop” includes everything it takes to start getting paid for it.

Surely the equity is not left up for grabs for cheap by the time it is a guaranteed to earn the owner lots of money.

[Tade0]

It's not a "big risk" in any capacity because drugs with low probability of success usually never reach the phase where they accumulate $3bln in costs.

The pharma industry has over a century of experience in managing risks of this sort, which is why it's so profitable.

[lotsofpulp]

Risk and reward are proportional, absent corruption. Managing risk does not make it disappear. Managing risk is what people get paid for, it’s the hard part that requires knowledge and expertise.

If there was no risk, then there would be no failed pharmaceutical businesses. If it was so easy to take medicines from idea to market and make a ton of money, people wouldn’t be wasting their time on buying stocks for other businesses.

It is also simultaneously possible that US patent law, as implemented with medicines, is too rewarding to pharma companies.