Intellectual Property and Medicine

So, since I'm researching IP law, I thought I'd throw this tidbit out there. Genetech, the veteran granddaddy of biotech firms, is sitting on a drug that apparently is rather effective at fighting breast cancer. If you want the full details, read the article, linked in the headline and below. The reason I bring it up is this quote, off Forbes.com:
Genetech'sWall Of Data: "And Herceptin won't help all breast cancer patients. Only 25% of patients have the mutated cancer gene that Herceptin targets. But the number of patients getting the medicine could double, according to a research note from James Reddoch, biotech analyst at Friedman, Billings, Ramsey. Reddoch raised his 2006 sales estimate for the drug from $622 million to more than $1 billion. Because the drug has such exceptionally high profit margins, every $100 million in sales adds a penny to Genentech's earnings. "

So we have a potential miracle drug and we're not just talking profits, but exceptionally high ones. Is this right? A life saving drug--being horribly expensive to the point that some might be barred access?

Now I will grant two points. First, I grant that insurance dollars will fund the majority of purchases. At the same time, this means higher insurance premiums/deductibles/whatever the right terminology is for all, which means the user DOES ultimately probably feel the cost. Yes it's spread across thousands and millions, but it still adds more money to the coffers than neccessarilly needs to be there. Also, what about those without insurance? Are their lives not worth saving?

Second, the economics of the issue ARE more complex. What was the cost of development? Every $100 million might add a penny to earnings (which doesn't sound like much but I guess it is...need to dive into investments next semester before I comment on that one), but anyway, what was the cost of development? An innovative company SHOULD be rewarded for its intellectual capital and expertise, if only so that it can keep getting better at what it does and make more discoveries. It's been essentially proven that profits don't drive innovation, but profits allow the innovation box (the company) to continue to exist. So I don't have a problem with modest profits, just exceptionally high ones, which, granted, the article doesn't explain.

Still, the complexities and moral dilemmas of this issue are tremendous ones, and there's a good reason why I'm avoiding it in my research. A good part of the world economy DOES benefit from IP rights, but medicine may (or may not) be another story.

Opinions?