The pharmaceutical industry argues that because new drugs will not be

Question

The pharmaceutical industry argues that because new drugs will not be developed unless heavy development costs can be recouped in later sales, the current 20 years of protection provided by patents should be extended in the case of newly developed drugs.
@veritaskarishma
The Pharmaceutical companies:
- New drugs will not be developed unless heavy development costs can be recouped in later sales
Hence, extend the current 20 year protection.

Which of the following, if true, most strongly supports the pharmaceutical industry’s argument against the challenge made above?

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection.

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete.

(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry.

(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug.

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective.

KarishmaB · Accepted Answer

The Pharmaceutical companies:
- New drugs will not be developed unless heavy development costs can be recouped in later sales
Hence, extend the current 20 year protection.

The author:
- In other industries new-product development continues despite high development costs
So the extension is unnecessary

We need to support the pharma companies.

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection.
If they haven't asked for extension, doesn't mean they don't need it. Irrelevant already.

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete.
Of the 20 years granted to them, pharma companies lose out 10 years on trials. Hence, it brings to the fore the need for extension for pharma companies and supports their cause.

(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry.
Here is a possible trap answer. One reason why pharma companies may need extension is "low returns every year" i.e. if the returns in the pharma sector are not as high as those in the other sectors, relative to the research and development cost. But this option is opposite of that. It says that the ratio of research costs to revenues is lower in pharma sector (which means that either research cost is low or revenue is high). This does not help the extension request of pharma sector.

(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug.
If alternative drugs can be brought in, a patent does not help in recovering the cost anyway. Here is the problem then - how will extending the patent help in recovering the cost? If the patent is ineffective, how will extending an ineffective solution help? 
This is similar to saying - there is a law against teenage drinking that fines $100 for first offence. But most teenagers are not caught because they drink the liquor available at home. We should increase the fine to $150. 
When the law is not effective, how will increasing the fine help? We need to get some more stringent laws in to remedy the situation. 
Hence (D) is not the answer.

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective.
It may help explain why other industries may not care about longer patent periods but it doesn't help explain how longer patent periods will help pharma.

Answer (B)

dimitri92 · Answer

IMO B

In B we give credibility to the claim of the pharmaceutical industry. The 10 year period required for the clinical tests to complete is the reason why the patent is held for 20 years. Thus, B is the best choice to support their claim.

seekmba · Answer

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection. - irrelevant

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete. - correct

(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry. - we are not talking abt other industries

(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug. - this actually weakens the phramaceutical industry's claim.

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective. - we are not talking abt other industries

cano · Answer

A. Other industries not the concern here.
B. That could be a difference with other industries, and make a good point why this specific industry needs a longer term of protection compared to other industries.
C. Doesn't support the pharm. industry.
D. Doesn't support the pharm. industry.
E. Doesn't support the pharm. industry.

anish319 · Answer

I think B is the only one that further supports the claim by pharmaceutical companies that patent protections should be extended further than 20 years. The fact that it takes 10 years to finish clinical trials which is half the time that patents are protected for.

bibha · Answer

What is the qs asking?
"in other industries new-product development continues despite high development costs, a fact that indicates that the extension is unnecessary."
Is it asking for an answer that supports that extension is unnecessary?? If so then why not A??

noboru · Answer

OA is B.

Of the 20 years, only half are effective so it is ok for these companies to ask for an extension.

Zatarra · Answer

Hi can you Please tag the source especially if its GMATPREP .I thought You always posted LSAT Questions.Thanks

noboru · Answer

Yes. I usually post LSAT question (I promise more very soon!). This one was an exception!

Chembeti · Answer

IMO, D is a strong contender. 
Assume that company C1 gets a patent and brings a product to the market. Immediately another company C2 produces a similar drug (but complies with the law as per D). Because for the company C2 there is no research cost and less development cost, C2 can bring the drug for lesser price compared to C1's. Hence C1 is forced to slash its price as well, which means they are not able to recoup development cost in later sales. This fact is stated in the first line of the argument. Hence D supports, but does not weakens.

But B is better than D, because if patent expiry time is extended, there will be less no. of companies who will be creating 'similar' drugs. Otherwise, there will be many companies who will create EXACT products immediately after the patent expiry.

vnigam21 · Answer

The pharmaceutical industry argues that because new drugs will not be developed unless heavy development costs can be recouped in later sales, the current 20 years of protection provided by patents should be extended in the case of newly developed drugs.
@veritaskarishma
The Pharmaceutical companies:
- New drugs will not be developed unless heavy development costs can be recouped in later sales
Hence, extend the current 20 year protection.

Which of the following, if true, most strongly supports the pharmaceutical industry’s argument against the challenge made above?

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection. 
 Choice A is incorrect: the fact that the pharmaceutical industry’s request is unique does nothing to justify that request.

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete. 
 Choice B is the best answer because it provides an explanation: required clinical trials prevent new drugs from being sold for much of the time they receive patent protection. 
 
 (C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry. 
  it undermines the pharmaceutical industry’s argument, so it is incorrect
 
 (D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug. 
 Choice D indicates that alternative drugs might render patent protection worthless, but that is clearly no reason to extend the protection.

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective. 
  it undermines the pharmaceutical industry’s argument, so it is incorrect

Can someone explain option D in more detail?

hotshot02 · Answer

B because it provides the valid reason for the extension of the patents in pharmaceutical industry

bubbly2010 · Answer

The pharmaceutical industry argues that because new drugs will not be developed unless heavy development costs can be recouped in later sales, the current 20 years of protection provided by patents should be extended in the case of newly developed drugs.
@veritaskarishma
The Pharmaceutical companies:
- New drugs will not be developed unless heavy development costs can be recouped in later sales
Hence, extend the current 20 year protection.

C: extension not needed 
WHY: other industries cont. with dev. of new product despite high cost 
we need to find a reason that makes it okay for pharmaceuticals to ask for more time. we need to find out what makes them diff. from other industries

Which of the following, if true, most strongly supports the pharmaceutical industry’s argument against the challenge made above?

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection. - IRR

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete. - CORRECT

(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry. - IRR

(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug. - IRR

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective. - IRR

Gunika16 · Answer

Hello  VeritasKarishma ,

Thank you for the detailed response. Based on my judgement and your analysis I was wondering whether the reason for eliminating option C as the correct answer choice would be the fact that it talks of revenue gains, while the question stimulus nowhere mentions anything about revenue? Although it is explicitly mentioned that development in other industries continues despite the high development costs.

Your reasoning will help me improve my understanding a little more.

Thanks,
Gunika

Tracy95 · Answer

No, it's the other way around. It is asking for an answer that supports the idea that extension  is necessary .

LIBERTYRodP · Answer

WEAKEN, ANALOGIES

This is a clear example of an analogy in CR. In this case we are asked to WEAKEN the analogy set by the author. Theory indicates that we can achieve so by

- Hinting that the support case (the example given by the author to support his position) can't be applied to the conclusion case (the prediction) due to differences.

Pre-thinking:

Support case : " in other industries new-product development continues despite high development costs"

Conclusion case: " the extension (for the pharmaceutical industry) is unnecessary".

We must find an answer that indicates that there is (or could be) marked differences between the  pharmaceutical industry  and  the other industries.

(A) No industries other than the pharmaceutical industry have asked for an extension of the 20-year limit on patent protection.   ------------ This does not give an inherent difference between the pharmaceutical industries and the other ones.

(B) Clinical trials of new drugs, which occur after the patent is granted and before the new drug can be marketed, often now take as long as 10 years to complete.   -------------------- CORRECT. This one hints at the possibility that the pharma industry follows different procedures to commercialize a product and make profits, that's why an extension would be reasonable. It is not clear whether the "other industries" also have clinical trials that last that long but, remember, that weakening a conclusion is about   raising some doubt   , not necessarily proving the conclusion wrong.

(C) There are several industries in which the ratio of research and development costs to revenues is higher than it is in the pharmaceutical industry.   ----------- This one does give a difference but in favor of the other industries. So, if the other industries have higher costs and less profits than the pharma one, and are not asking for an extension, then why is the pharma asking for an extension.

(D) An existing patent for a drug does not legally prevent pharmaceutical companies from bringing to market alternative drugs, provided they are sufficiently dissimilar to the patented drug.  ----------- Does not provide a difference.

(E) Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective.   ---------------- Does not provide a difference between the pharma industry and the other ones.

mSKR · Answer

Question1: Author argues against pharmaceutical companies on the basis of other industries. S o What if I weaken the author claim, It would not ultimately support pharmaceutical companies? Why /Why not? E option is exactly doing this. That other industries actually don’t need patent. Question 2.) Should I choose E option , if question were: Which of the following, if true, most strongly WEAKENS the author’s claim? Is it? VeritasKarishma carouselambra : Please clarify the doubt . Thanks!

carouselambra · Answer

mSKR Here is my take. But first lets make sure that we are on the same page. The pharmaceutical industry argues that because new drugs will not be developed unless heavy development costs can be recouped in later sales, the current 20 years of protection provided by patents should be extended in the case of newly developed drugs. However , in other industries new-product development continues despite high development costs, a fact that indicates that the extension is unnecessary. Question1: Author argues against pharmaceutical companies on the basis of other industries. S o What if I weaken the author claim, It would not ultimately support pharmaceutical companies? Why /Why not? E option is exactly doing this. That other industries actually don’t need patent. Read the option (E) carefully. Much recent industrial innovation has occurred in products—for example, in the computer and electronics industries—for which patent protection is often very ineffective. Now, 1.What does often mean here? 1% ? 99%? 50%? You never know! Since the success rate is not specified, we cannot be sure. 2.Besides, just because it was effective in other industries, how can we assume that it will help pharma? Combining 1 and 2, there is a level of uncertainty because of which (E) is not the correct answer. Question 2.) Should I choose E option , if question were: Which of the following, if true, most strongly WEAKENS the author’s claim? Keeping inline with the above pre-thinking that we just did, (E) is the incorrect option in all aspects.

KarishmaB · Answer

Option (E) is irrelevant. We often say that even if something happened in a certain way in X, it doesn't mean that it will happen the same way in Y. 
But in cases where X and Y are comparable situations such as cities with similar demography etc, we say that comparison could make sense. 
Here, we are not given whether pharma and computer industries are comparable. Pharma involves huge development cost. Does computer industry? Is there any comparison? We don't know. So we should just ignore option (E).

The pharmaceutical industry argues that because new drugs will not be

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The pharmaceutical industry argues that because new drugs will not be

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