[jandrewrogers]

The research is inexpensive, the development is not. Having the government do the inexpensive part -- the research -- does not eliminate the extremely expensive development. Almost all the cost of new pharmaceuticals is in the development phase. Government funding research is a drop in the bucket after private companies fund the clinical trials.

While government has an okay track record funding research, they have a pretty poor track record funding development, hence why it is left to private companies. This has to do with the way governments legally structure funding combined with the fact that development cycles are much longer than political cycles. In areas where the government does fund development, the development is interrupted by constantly shifting funding priorities and politicians trying to redirect money to their districts or constituents in the middle of development. This tends to make things cost (at least) twice as much and take (at least) twice as long as they would in environments where the development cycle is guaranteed to be uninterrupted and free from the whims of whoever is elected this year.