My understanding is that the govt would "save the money" from the co-payments until it reached 20 billion dollars- in several years time.
To me the idea of the co-payment funding a research fund in this way is great spin but ultimately absurd: the last time I checked money- especially government money- was fungible.
At the point they hit the 20 billion the investment income from that- a billion a year- goes into research.
Joe Hockey was making all these sincere noises on the 7:30 report about how fantastic it would be if we found a cure for all these diseases like MS. Pffft, I though to myself, here's a man who's spent his time investing in real estate, not biotech. If only it were as easy as throwing money at it.
Will it be good for the sector? Depends how well they spend the money. After all, CSL and Cochlear came from govt research. A couple of those and it would pay for itself.
So it won't influence the sector, if it gets up, for a few years.
