5 ms·

The reading of free market theory with which most people, including its founder, would agree, is one where the goal is to maximize utility, not wealth. This is

by codexon 11y ago

The reading of free market theory with which most people, including its founder, would agree, is one where the goal is to maximize utility, not wealth. This is a vitally important distinction, and one that the layperson often overlooks. I would argue that human life is not limitless in utility and the free market establishes a price range on it. Like it or not, there is a price tag on the utility of a human life. If you need to spend 100k per year on drugs to live and you cannot make 100k per year, then the free market has decided that your life is not worth the cost because you are not creating 100k worth of value to trade 100k worth of drugs you are taking out of the market. I don't think it is reasonable to say that a market in which you arbitrarily decide that a human life has unlimited utlity is a "free" market at all. We can all agree that jacking up the price of a life-saving drug to save more money is despicable, but we would be lying to ourselves if we pretended this wasn't part of the free market.

ken47 11y ago
I suppose the statement you are latching onto is where I said that it is never economically optimal to allow someone to die in exchange for higher profit, so allow me to clarify. In this case, it seems nearly impossible to make a concrete case that links this monopolistically-determined price increase to something that comes close to morally justifying the potential loss of human lives. And as we know, pharma is not a free market in general, and is certainly not in this specific case, so the idea of the free market setting the price on lives seems inapplicable here.
- codexon 11y ago
  I don't see how pharma is not a free market in this case. The drug in question isn't even protected by a patent anymore. Other companies are free to create a generic version of it. Government regulation has nothing to do with this. The free market has everything to do with this. The price of a life saving drug is worth either all your money or however much the seller wants to charge for it, as decided by the free market.
  - bduerst 11y ago
    One of reasons Turing paid $55 million for Daraprim, rather than just produce the chemical compound pyrimethamine, is because it's an approved Medicare drug.
    - codexon 11y ago
      I'm not old enough to use medicare so I don't know the details. But I am willing to bet that if someone started making a cheaper generic version of Daraprim, it would put on the approved list. The reason pyrimethamine isn't on the list is because no one wanted to make a generic version that hardly anyone uses for $1 per pill. And even if it wasn't, the drug was being sold for $1 per pill just a few years ago. You can easily pay that without any insurance at all.
      - ken47 11y ago
        If you do some research into this particular medicine, you will see that there are clear, non-free market roadblocks to producing a generic version.
        codexon 11y ago
        I looked into it and I don't find any. It is not patented, and no law forces you to only use the brand Daraprim. If someone created a generic replacement, it would be on the fast track to be approved like every other generic. The synthesis method is even listed publicly. https://pubchem.ncbi.nlm.nih.gov/compound/4993#section=Use-and-Manufacturing https://pubchem.ncbi.nlm.nih.gov/compound/4993#section=Use-a... The only roadblock to a generic version was because no one wanted to compete with $1/pill. FDA information: http://www.accessdata.fda.gov/scripts/cder/ob/docs/obdetail.cfm?Appl_No=008578&TABLE1=OB_Rx http://www.accessdata.fda.gov/scripts/cder/ob/docs/obdetail.... http://www.accessdata.fda.gov/scripts/cder/ob/docs/patexclnew.cfm?Appl_No=008578&Product_No=001&table1=OB_Rx http://www.accessdata.fda.gov/scripts/cder/ob/docs/patexclne... There are no unexpired patents for this product in the Orange Book Database. There is no unexpired exclusivity for this product.
cortesoft 11y ago
The sentence "If you need to spend 100k per year on drugs to live and you cannot make 100k per year, then the free market has decided that your life is not worth the cost because you are not creating 100k worth of value to trade 100k worth of drugs you are taking out of the market" is simply not true. The free market doesn't say anything about the worth of a life being only equal to how much an individual can earn. It says the market price of something is equal to what people are willing to pay for it. We have things like insurance that allow us to have more medical care than we could afford as individuals, and that is completely within the concept of a free market.
- codexon 11y ago
  I did not mention insurance to simplify the discussion. Why would I bother listing all the possible situations that don't even change the outcome? Of course you can buy insurance as a sort of reverse lottery to cover your costs. But you paid into that insurance and it is not required to cover everything. The co-pays/insurance can also bankrupt you. And my main point still stands. If you cannot afford the cost of life saving medication, with or without insurance, then the free market has decided that your life is worth less than the cost of medication. Saying the free market doesn't put a cost on human life and that it doesn't encourage price gouging is simply false.

by codexon 11y ago

ken47 11y ago

I suppose the statement you are latching onto is where I said that it is never economically optimal to allow someone to die in exchange for higher profit, so allow me to clarify. In this case, it seems nearly impossible to make a concrete case that links this monopolistically-determined price increase to something that comes close to morally justifying the potential loss of human lives. And as we know, pharma is not a free market in general, and is certainly not in this specific case, so the idea of the free market setting the price on lives seems inapplicable here.

codexon 11y ago
I don't see how pharma is not a free market in this case. The drug in question isn't even protected by a patent anymore. Other companies are free to create a generic version of it. Government regulation has nothing to do with this. The free market has everything to do with this. The price of a life saving drug is worth either all your money or however much the seller wants to charge for it, as decided by the free market.
- bduerst 11y ago
  One of reasons Turing paid $55 million for Daraprim, rather than just produce the chemical compound pyrimethamine, is because it's an approved Medicare drug.
  - codexon 11y ago
    I'm not old enough to use medicare so I don't know the details. But I am willing to bet that if someone started making a cheaper generic version of Daraprim, it would put on the approved list. The reason pyrimethamine isn't on the list is because no one wanted to make a generic version that hardly anyone uses for $1 per pill. And even if it wasn't, the drug was being sold for $1 per pill just a few years ago. You can easily pay that without any insurance at all.
    - ken47 11y ago
      If you do some research into this particular medicine, you will see that there are clear, non-free market roadblocks to producing a generic version.
      - codexon 11y ago
        I looked into it and I don't find any. It is not patented, and no law forces you to only use the brand Daraprim. If someone created a generic replacement, it would be on the fast track to be approved like every other generic. The synthesis method is even listed publicly. https://pubchem.ncbi.nlm.nih.gov/compound/4993#section=Use-and-Manufacturing https://pubchem.ncbi.nlm.nih.gov/compound/4993#section=Use-a... The only roadblock to a generic version was because no one wanted to compete with $1/pill. FDA information: http://www.accessdata.fda.gov/scripts/cder/ob/docs/obdetail.cfm?Appl_No=008578&TABLE1=OB_Rx http://www.accessdata.fda.gov/scripts/cder/ob/docs/obdetail.... http://www.accessdata.fda.gov/scripts/cder/ob/docs/patexclnew.cfm?Appl_No=008578&Product_No=001&table1=OB_Rx http://www.accessdata.fda.gov/scripts/cder/ob/docs/patexclne... There are no unexpired patents for this product in the Orange Book Database. There is no unexpired exclusivity for this product.

cortesoft 11y ago

The sentence "If you need to spend 100k per year on drugs to live and you cannot make 100k per year, then the free market has decided that your life is not worth the cost because you are not creating 100k worth of value to trade 100k worth of drugs you are taking out of the market" is simply not true. The free market doesn't say anything about the worth of a life being only equal to how much an individual can earn. It says the market price of something is equal to what people are willing to pay for it. We have things like insurance that allow us to have more medical care than we could afford as individuals, and that is completely within the concept of a free market.

codexon 11y ago
I did not mention insurance to simplify the discussion. Why would I bother listing all the possible situations that don't even change the outcome? Of course you can buy insurance as a sort of reverse lottery to cover your costs. But you paid into that insurance and it is not required to cover everything. The co-pays/insurance can also bankrupt you. And my main point still stands. If you cannot afford the cost of life saving medication, with or without insurance, then the free market has decided that your life is worth less than the cost of medication. Saying the free market doesn't put a cost on human life and that it doesn't encourage price gouging is simply false.