Under this approach, drugs are conditionally approved and marketed, with the revenue generated following the conditional approval covering the costly trial for proving efficacy. Such a scheme facilitates lower drug pricing, while overcoming the effect of Eroom s law on investment in treatments for many diseases.

The experience of the recent eurozone crisis stands in sharp contrast to the Latin American debt crisis in the 1980s, when banks were not allowed to exit precipitously from their loans. If the new proposal is adopted, the IMF would conditionally refuse funds to countries carrying debt burdens that Fund staff determine are most likely unsustainable creditors would first have to agree to a reprofiling of debt.