Kyle Bass and Zombie Drugs

Zombie Drugs are drugs on which the patents just do not seem to die, even though they seem invalid. Kyle Bass has put together a petition against two big-ticket pharmaceutical companies because they hold several “zombie” patents on drugs for spurious reasons. One drug has a patent on the speckling of the pill, which has no function whatsoever in the pill’s ability to medicate an individual. The other has to do with a generic rubber stopper used in the containing apparatus of a drug. Both items are used to increase price of the medications in question as much as ninety percent. So where a drug should cost ten dollars, it’s sold for a hundred.

Kyle Bass runs the Coalition for Affordable Drugs, and has successfully decreased the cost of pharmaceuticals in the past. Based in Texas, Bass is a hedge-fund manager with roots in Texas and ties to the presiding authority of his home country of Argentina, Cristina Fernandez de Kirchner, a known socialist advocate. So the question then becomes: what are the aims of Kyle Bass in regard to lowering the cost of pharmaceutical medication? Are his aims purely benign, do they have to do with some humanitarian sympathy, or is this a concerted push to destabilize corporations such that a socialist putsch may have greater success? It’s difficult to tell, but there are some indicators.

First and foremost, Bass has always profited off the lost of great organizations. He exploded on the financial scene in 2008 when he successfully predicted the lending crisis which lead to the economic implosion America experienced that September. Since then he’s successfully predicted economic difficulties in the Japanese market, and currently has some ideas about a coming economic implosion in China. With the Coalition for Affordable Drugs, he appeared to be breaking this negative-prediction mold, until it was revealed that he short-sold a bunch of stock in the pharmaceutical companies his organization forced to downsize via drug-price reduction. So through the Coalition for Affordable Drugs, Bass facilitated a corporate loss from which he profited. It’s for this reason that the US government has waxed bipartisan in their effort to shut down the perfectly legal loophole Bass has exploited in this scenario.

So are his current aims against pharmaceutical organizations with false patents humanitarian, or is this another scheme of his to make money from the losses of others? Well, a case can be made for either, and Cristina Fernandez de Kirchner just complicates things.

Kyle Bass continues to make controversial choices that yield exceptional profits, and that seems to be the trend he will continue to maintain. Perhaps Bass can be used as a market barometer of sorts in future financial investment opportunities.