UNDER THE MICROSCOPE : New drug dealers

I really like talking about money with those who have lots of it. Big money is at the core of the pharmaceutical industry, and none of those whom I was with earned less than ten times my own quite adequate salary. They were mostly Americans who, unlike the British, are very happy to talk about money. It was common to hear someone ask who looked after the boat when you are away from the Caribbean. They were entrepreneurs and chief executives who almost fainted with disbelief when I said, nay, confessed, that I was not interested in the practical use or applications of my work in developmental biology. The more so because I was not looking for something to patent. I was interested in it because it was just so fundamental and fascinating; apparently a weird attitude.

It is with the drugs industry that one can find capitalism working happily and successfully with the new biology - molecular biology. Molecules can be hot properties. At the end of the money/science chain are the multi- national corporations, with a reputation for wickedness. They are thought to foist unwanted and unnecessary medicines upon us, and to make unjustifiably large profits. I must, however, come some way to their defence. They have, after all, a vested interest in being reliable and appearing honourable.

It costs, give or take the odd 10 million or so, pounds 150 million to get a drug onto the market. Much of the expense comes not from supporting the biological basis of the research, but from the clinical trials. These are absolutely essential both for testing whether the drug really works and for detecting side effects. Because of these costs the big players will not consider developing what they refer to as "boutique drugs" - ones whose sales will bring in less than pounds 150m a year. This could be a serious failing in the system because there are many diseases that affect small numbers of people and so could not generate such a large income. But there are other players in the chain.

The most imaginative, and the most risky, links are provided by the new small biotechnology companies. There are more than 1,000 such firms in the US, only a few make a product. They will make boutique drugs. This is a heady world trying to apply the science that comes from universities and research institutes: that is where the basic research is done as the large companies would not dream of doing it themselves. Discover, patent, sell, is the way to money. But while the adventurous spirit is strong, so are, as in Darwinian evolution, the selective pressures. Many fail.

Where does the money for these adventures come from? Venture capitalists. You need about pounds 10m to get off the ground. If you do well then the risk goes down and the next pounds 100m will be much easier to find. The early risk is worthwhile as one can reap considerable benefits, for with success, the stock price will boom. The companies can make large profits and returns may be up to 30 per cent, but the risks are high.

The benefits to us in terms of our health are huge. In the US the drugs cost less than 10 per cent of the health bill. If drugs were completely removed from the system the overall costs could increase 100-fold as they keep people out of hospital. Their greed may be good for our health.