I'm supposed to be on holiday.  But everyone is linking to this post by Ben Domenech which, like, totally proves that I don't know what I'm talking about regarding pharma research, so I should probably point to this post by Derek Lowe, pharma researcher, which questions Ben Domenech's analysis.  It's true that I oversimplified both pharma and academia's role:  academia sometimes develops drugs, while pharma does basic research.  Such is blogging.  The broad point is that basic research and developing a working drug are two different activities, and neither is "real" innovation.  I don't want to stop government from funding basic research, and never said I did.  But producing drugs does not seem to be the government's core competence.