[zanny]

You must consider though how the massive test run costs associated only exist because the FDA believed drug companies could foot the bill since they got monopoly distribution.

In a patent-free world, those regulations wouldn't hold weight. What would happen (I imagine) is independently sponsored r&d produces drugs for trial that the FDA itself puts through clinical trials on taxpayer money. You can't sell a drug without FDA approval still, but since drug companies aren't operating as super-for-profit businesses on chemical compounds to help people live, they would foot the bill to make sure its safe.

[busyant]

Your scenario would be a helluva shakeup on how things are done now.

It would be interesting to see if your scenario would end up doing a better or worse job with respect to drug development.