Chris Campbell sparked a new topic over on the lawyer-bashing thread that is worthy of consideration by the high-minded denizens of this electronic shag-carpeted conversation pit.
We were talking about the "Greed of the Pharma Industry" and Chris raised the following objections:
Quote:
(a) their tight grip on the loins (and wallets) of our politicians by virtue of their incredible lobbying power in Washington;
(b) the fact that we in the U.S. pay substantially more for the identical drugs than our European and Canadian friends do, because their governments and populations would not tolerate what we seem to bend over and accept; and
(c) that our nation's patent and trademark system props up the monopoly power of the pharma's by prohibiting competition (i.e., generics) for an excessively long duration.
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You'll get no debate from me on (a). Lobbying is a reality, whether the lobbyists are employed by big pharma or "interest groups" like AARP.
(b) The rest of the world imposes price controls. With the exception of some enviable apartments in Manhattan, I can't think of any circumstance where the government intereferes with the market, nor should it. This is related to my point below, which is that. . .
(c) the Patent and Trademark system DOES prohibit competition, and it SHOULD. The drug development process takes literally dozens of years to bring a "blockbuster" drug to market, which costs BILLIONS of dollars. Innovations do not just happen by chance: they are the result of thousands of people working together from compound identification, through three phases of clinical trials, to bring the drug to market. Because we want, as a society, to ENCOURAGE that kind of development, we grant a legal monopoly, the PATENT, which should allow the manufacturer to charge whatever the market will bear. Inelasticity of supply caused by the government protecting your composition of matter means the supply curve is VERTICAL-- you can charge whatever you want, and if the resources are there to pay, that's what you make!
There are folks who think that lifesaving or life-improving drugs should become public domain. Jonas Salk, who is credited with developing the Polio vaccine, refused to patent it, claiming, "There is no patent. Could you patent the Sun?" Pharma companies manufactured it and it was administered around the world FREE of charge. Spurred by Salk's altruism, people think that big pharma companies should do the same.
Efforts by our own government to permit reimportation of pharmacetuicals are being pushed by various senior groups. The trouble is, if you allow reimportation from a country that has price controls, you have effectively implemented price controls here, to say nothing of the clinical danger involved, e.g. we've all read in the NYT about the nice seniors who take the bus, but what about the ripoff shops that spring up in Mexico that will resell potentially harmful knockoffs?
Everyone *****es about the price of prescription drugs as an increasing component of the monthly budget of a person on a fixed income. Where is the lobbying organization to reduce the senior's rent? Where are the price controls for the grocery store or the gas station? Because big pharma is highly visible, it's an easy target.
To me, limiting pharma company profits will remove the incentive for drug development, and that's a lose-lose for the whole world.
If the shareholders of XYZ pharma want to give the drugs away, that's their choice, not the government's.
The new Medicare prescription drug benefit kicks in as a fully funded benefit (not the prescription discount card, which is a transitional mechanism) in 2006. The government may NEGOTIATE the prices of drugs with manufacturers, just the same way that a PBM does now. . . but that's not the same as a cap on profitability.
Any divergent views?