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Peter Thiel's Uncomplimentary Views on Big Pharma - Science
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A 2014 blog post with limited direct AI safety relevance; tangentially useful for discussions of institutional incentives, innovation stagnation, and how incumbent industries resist technological change—themes that parallel debates about AI deployment and incumbent tech firms.
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Importance: 18/100blog postcommentary
Summary
Derek Lowe responds to Peter Thiel's 2014 claim that pharmaceutical companies are 'bets against innovation,' arguing they are better characterized as indifferent to innovation rather than actively anti-innovation. Lowe acknowledges valid concerns about large pharma prioritizing M&A, patent extensions, and share buybacks over R&D, while defending genuine research efforts like Eli Lilly's Alzheimer's program. The piece engages Thiel's broader thesis about technological stagnation in modern capitalism.
Key Points
- •Thiel argues large pharma companies are fundamentally anti-innovation, primarily extending patents and blocking smaller competitors rather than developing new treatments.
- •Lowe counters that big pharma is better described as 'indifferent' to innovation—preferring to maximize existing assets via line extensions and acquisitions over risky R&D.
- •Share buybacks are highlighted as particularly concerning, diverting capital that could fund research into propping up share prices instead.
- •Eli Lilly's aggressive Alzheimer's research is cited as evidence that major pharma companies do pursue genuine high-risk innovation, complicating Thiel's blanket critique.
- •Thiel's broader argument about capital misallocation—funding social media over medical research—is acknowledged as having real merit despite oversimplifying pharma specifically.
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| Page | Type | Quality |
|---|---|---|
| Peter Thiel (Funder) | Organization | 63.0 |
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# Peter Thiel's Uncomplimentary Views of Big Pharma
- 19 Sep 2014
- 3:15 AM ET
- By
[Derek Lowe](https://www.science.org/content/author/derek-lowe "Derek Lowe")
- 4 min read
- [Comments](https://www.science.org/content/blog-post/peter-thiel-s-uncomplimentary-views-big-pharma#disqus_thread)
See what you think of Peter Thiel's characterization of the drug industry in [this piece](http://www.technologyreview.com/qa/530901/technology-stalled-in-1970/) for _Technology Review_. Thiel's a very intelligent guy, and his larger points about technology stalling out make uncomfortable reading, in the best sense. (The famous quote is "We wanted flying cars; instead we got 140 characters"). But take a look at this (emphasis added):
> _You have to think of companies like Microsoft or Oracle or Hewlett-Packard as fundamentally bets against technology. They keep throwing off profits as long as nothing changes. Microsoft was a technology company in the ’80s and ’90s; in this decade you invest because you’re betting on the world not changing. **Pharma companies are bets against innovation because they’re mostly just figuring out ways to extend the lifetime of patents and block small companies.** All these companies that start as technological companies become antitechnological in character. Whether the world changes or not might vary from company to company, but if it turns out that these antitechnology companies are going to be good investments, that’s quite bad for our society._
I'd be interested in hearing him revise and extend those remarks, as they say in Washington. My initial reaction was to sit down and write an angry refutation, but I'm having second thoughts. The point about larger companies becoming more cautious is certainly true, and I've complained here about drug companies turning to [M&A](https://www.science.org/content/blog-post/big-drug-mergers-so-they-re-ok-right) and [share buybacks](https://www.science.org/content/blog-post/buying-back-shares-admission-defeat) instead of [putting that money](https://www.science.org/content/blog-post/more-pharma-stock-buybacks) back into research. I'd say, though, that the big drug companies aren't so much anti-technology as they are indifferent to it (or as indifferent as they can afford to be).
Even that still sounds harsh - what I mean is that they'd much rather maximize what they have, as opposed to coming up with something else. Line extensions and patent strategies are the most obvious forms of this. Buying someone else's innovations comes next, because it still avoids the pain and uncertainty of coming up with your own. There's no big drug company that does only these things, but they all do them to some degree. Share buybacks ar
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