My wife is a doctorate in pharmacology, I made exactly this argument to her but she dismantled it pretty quickly.

a) We do test on terminally ill people, but after testing in other models. b) Thalidomide was all roses compared to the horrors you can inflict. c) Profit-driven industry makes extremely perverse incentives.

Still I do come down more on your side of the argument, and we have historically made massive leaps doing some horrific things.

I wonder if we can get better models based off of human cell-lines / tissues? Like CRISPR did?