3 ms·
It is a common misconception that the US subsidizes others. Expenditures by US companies account for no more than 50% of pharmaceutical research among the top
by pcrh 11y ago
It is a common misconception that the US subsidizes others. Expenditures by US companies account for no more than 50% of pharmaceutical research among the top ten drug companies [0], so the rest of the world contributes as much as does the US. I don't think any other US spending could be considered a subsidy to others.
[0] http://www.fool.com/investing/general/2013/09/23/the-pharmaceutical-industrys-10-biggest-rd-budgets.aspx http://www.fool.com/investing/general/2013/09/23/the-pharmac...
- nostromo 11y agoHow does that refute his point? Take Roche -- based in Switzerland. Their largest market by revenue is... the US. Their US revenues are 63% higher than all of their European sales combined. http://webcache.googleusercontent.com/search?q=cache:uNS_cQR0BtkJ:www.roche.com/med-cor-2014-10-16-e.rtf+&cd=3&hl=en&ct=clnk&gl=us&client=safari http://webcache.googleusercontent.com/search?q=cache:uNS_cQR...
- forrestthewoods 11y agoDing ding ding, winner!!
- antr 11y agoYou might want to explain the USA's addiction to prescription drugs, and how your conclusion is hence, well, misguided https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/216249/dh_117977.pdf https://www.gov.uk/government/uploads/system/uploads/attachm...
- forrestthewoods 11y agoYes. The USA is addicted to prescription drugs. That addiction puts significant money in the pocket of pharmaceutical companies. Those companies may or may not be American. Either way their pockets are lined with American dollars.
- DasIch 11y agoThis only shows that Roche can either sell much more on the US market or that their margins can be much higher there. That's certainly interesting but doesn't explain anything at all.
- cdavid 11y agoFirst, it is rather ludicrous to suggest the main difference in health care expenditures is linked to the US subsidising medicines. For example, while the US spend 17.1% of GDP in health, the UK spend 9.4 % (http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS). The 8 points of GDP difference represents close to 300 billions $, which would be a significant proportion of the revenue of all the pharmaceutical combined (I did not look much for reliable statistics of combined revenue, but saw that: http://www.statista.com/topics/1764/global-pharmaceutical-industry/ http://www.statista.com/topics/1764/global-pharmaceutical-in..., which suggests ~1 trillions USD). It is also well documented that sales are significantly more expensive in the US than in Europe (marketing expenses are higher than R&D for most big pharmaceutical, and that proportion is significantly more so in the US). So without more analysis, you can't say from higher sales whether the US are subsidising European healthcare or marketing departments.
- vidarh 11y agoNow consider that in most of Europe (all?) Roche is expressly legally prevented from advertising their prescription drugs, and it's clear that pure revenue numbers does not give sufficient information as the cost of sale are likely to be vastly different.
- antr 11y agoRefute? Easy. The US has an unhealthy addiction to prescription drugs: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/216249/dh_117977.pdf https://www.gov.uk/government/uploads/system/uploads/attachm...
- tsotha 11y agoThat's sort of irrelevant, though, if drug companies in other countries are supporting their research through high prices in the American market.
- InclinedPlane 11y agoClearly a major proportion of the profits for any pharmaceutical currently comes from the US, regardless of where those drugs were developed. If the global profits for pharmaceuticals are curtailed because the US stops paying a premium it seems foolish to say that the profit motive wouldn't be impacted in regards to spending on pharmaceutical R&D.