Srdjan, I'm not sure that Naderites are necessarily more "independent" than Tufts. ;-)

For a start, I think it's overly utopian to exclude opportunity cost. If you invest $100 in your business, you have to include "the interest you could have been earning" as part of the cost of the investment. Otherwise you can end up believing your business is profitable even though its return is less than you'd get by putting the $ in the bank and going to the beach.

Also, of course it is reasonable to include the cost of failed drugs- unless somebody has a mechanism to choose only the successful ones. ;-) If the business model accepts that for every five molecules in which you invest only one will prove successful, that one molecule has to cover all the costs or it's a duff business. Lets not forget that these people are trying to invent a new drug, not flipping burgers. A "failure" doesn't mean they screwed up, it's just what happens when you work at the bleeding edge.

If people want to question cost, perhaps they should start with the largest chunk of cost and process that is imposed by government in the first place. As noted in your link, towards the end of the process every extra day of delay can mean $1M in lost revenue. For example, reducing a seven-year compliance process by one year would remove the need to extract $365M from customers over the rest of the patent period. Surely it would make better sense to reduce these sorts of costs and delays rather than giving tax breaks or contributions to help companies cope. Thanks for the link you provided which confirms that pharmaceutical companies agree with this too.

Finally I'd suggest that were it ever to reach the point where pharma could claim back only out-of-pocket expenses for successful drugs as suggested by Public Citizen, R&D would dry up or shift overseas. I'm afraid that utopians have little if any understanding of risk or the returns you have to allow if you expect people to take risk for your benefit.