Posts from Random Posts

I’d like to start this by saying that I am by no means an expert in health care and do not invest in health care companies. 

This post was inspired by Alex Berensons’s piece on the NY Times today talking about the looming lawsuit crisis in the pharmaceutical industry.

Here are the problems as I see them with the way the pharmaceutical industry is set up today:

1 – Drug prices are sky high making them unafordable for many lower and middle income people.
2 – Medicare is going to cost even more because of the new drug benefit which to date over 30 million people have signed up for.
3 – New innovative drugs are not available because of the lenghty clinical trial process.
4 – There is limited competition in the pharmaceutical market due to long term patent protection
5 – It takes at least $100mm and often many times that amount to develop a new drug and get it to market.
6 – The pharma companies are starting to get hammered with lawsuits resulting from deaths or people becoming seriously ill from approved medications.

What if we set up a second way for drugs to come to market?

What if the person who discovers a new compound "open sources" the discovery?  What if they allow any company with a valid license to make the drug?  What if the government allowed anyone to take the drug who knowingly signed off on the risks involved?  What if the person who took the drug waived all rights to sue the maker of the drug?  What if the person who took the drug was required to complete a questionaire on the outcome and side effects that was made publicly available? What if the maker of the drug was not allowed to market the drug to patients?  What if doctors were required to analyze the public data on outcomes and side effects before prescribing the drug?

I have no idea if any of this makes any sense for the drug development business.  But this is akin to the new way that technology is developed and taken to market.  Why doesn’t this make sense for drugs as well?

Josh and I went to see Spamalot last night.

We loved it.  It’s a great show, very funny, and great songs too.

I was under the impression that you had to be a Monty Python fan to like this show, but I don’t think that is the case at all.

It’s just pure fun musical theater and I’d recommend it for anyone who likes that.

I blogged this past weekend that the Shake Shack needs to give us a webcam to monitor the line.

I just realized that I was not alone in asking for this.  Gothamist asked for the same thing on Monday of this week.

And yesterday Gothamist posted this email from a woman who works for Danny Meyer:

Thanks for your interest in the Shake Shack. I work for Union Square
Hospitality Group and just noticed your blurb suggesting a web cam. I
wanted to give you the heads up that we have purchased a web cam for
our website, www.shakeshacknyc.com,
and we expect this to be live on our site by Monday. It will display a
new still shot of the line every 15 seconds. Let me know if you have
any questions.

Awesome news.  They are listening (and reading blogs). Cool.

Now they need to double the size of the place to meet the demand they’ve created with their incredible burgers and shakes.

Max sent me a link to Shack Watchers, which is a social photblogging service designed to let people know how long the line is at the Shake Shack in Madison Square Park in NYC, about three blocks from our office.

It’s a really great idea, but an even better idea would be for Danny Meyer, the genius behind the Shake Shack, Union Square Cafe, Gramercy Tavern, and a number of other top restaurants in NYC, to put up a realtime webcam somewhere on the roof of the Shake Shack and put the video up on the Shake Shack website.

I am not an expert in such things, but I bet it wouldn’t cost more than a couple thousand bucks to do it and the goodwill they’d get from the community would be enormous.

Check it out Tom Watson and the rest of the blog world’s baseball nuts.

Ballbug – the memeorandum for baseball.

Charlie calls it the best link he’s ever been sent

Courtesy of Brian Oberkirch.

I’ve been out of the office travelling the past couple weeks and have missed some good stuff.

But thankfully Charlie has captured the craziest moment and put it on his blog.

A pigeon flew into our office last week.

Check it out.

I can’t read the newspaper anymore without getting an incredibly strong urge to post. I need a two way medium and the newspaper (online and offline) is still a one way medium.

So I’d like to start doing short posts with my quick thoughts on stories.  Here it goes starting with today’s New York Times.

Internet Injects Sweeping Change Into US Politics – Are you surprised?  I’m not. "The Internet, they said, appears to be far more efficient, and less
costly, than the traditional tools of politics, notably door knocking
and telephone banks." The only thing surprising to me is that it took them ten years to figure this out.

Death By Smiley Face – When Rivals Disdain Profit – A story about "the zero billion dollar business" phenomenon is interesting, but it features lala.com, which I doubt disdains profits if it has taken close to $10mm in venture capital from Bain and Ignition (something I’ve heard but not verified).

Selling Short The Virtues of the Short Seller – Joe Nocera is generally spot on in his columns which don’t get nearly the readership they deserve because they are stuck behind the Times Select wall (and thus no link love on this story).  Short selling is a critical component of any true market. One of the five things I learned in business school is that a market is composed of speculators and hedgers.  You wouldn’t be able to hedge a position in a stock if there weren’t short sellers willing to take part in the transaction.  Anyone who engages in the vilification of short selling should take the time to understand how valuable short sellers are to a properly functioning market.  Nocera nails this issue.

Calculating What To Pay For A Home – There were actually two related stories in the paper today talking about the research two professors in Claremont, CA did on the housing bubble.  They focused on housing prices as a function of the rental income the homes would command. This approach (as opposed to focusing on comps which is what most brokers want you to do) is the way I’ve always thought about real estate. It is directly related to the notion that a business should be valued as the net present value of the cash flow it generates.  And so a home should be valued at the new present value of the net (after expenses) rental income it would generate if it was rented out instead of lived in.  I have generally felt that 20 times annual rental income is a good proxy for what a house should sell for.  That number (20x) is obviously a function of interest rates, the tax deductibility of mortgage interest, the real estate tax rates, and a host of other less significant factors. It would be great if Zillow and the other real estate value services would give you rental data for houses in your area.  I think that would be a great data point that would help people get a good sense of what to pay for (and what to sell for).

Emily turns 13 today.

The bat mitzvah is next month.

Man how time flies.

Happy birthday Em!

Most readers of this blog know that my wife Joanne has a blog called Gotham Gal.

She writes about a lot of things on her blog, but there are four kinds of posts that she does regularly:

• Her recipes
• Restaurant Reviews (mostly NYC restaurants)
• Movie Reviews
• Theater Reviews

I have been tagging these four kinds of posts in delicious for the past six months and plan to continue to do that.  Today, I burnt the delicious feeds of those tags and they are now displayed on the left sidebar in a section called "Gotham Gal’s Stuff".

You don’t need to know anything about delicious or feedburner to be able to use these links.

You can click on them and read them like a blog or you can click on them and subscribe to them as a feed.  I hope you like them.  I sure do.