Would it? Drug manufacturers don't really do as much 'R&D' as we assume, they buy biotech companies that have already discovered drugs. Also, why would a company stop wanting to make money? 'We are only going to make $5billion instead of $15 billion, let's not bother with that one.'
Private capital doesn't get allocated based on omniscience of future outcomes. It's about approximations of risk to reward in an environment of uncertainty. If you add risk or reduce reward of biotech, you get less private capital in biotech. Investors will allocate in other sectors with better risk to reward.
