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America's prices are a subsidy for the rest of the world, whom relies on American medications that they often outright infringe ownership of. Say what you want

America's prices are a subsidy for the rest of the world, whom relies on American medications that they often outright infringe ownership of. Say what you want about America, but it can't be denied that the majority of drugs in the last few decades which the world depends on has been thanks to the American government, American companies, and the American people. One way to fix the price would be simply to stop giving away our inventions for pennies, and get the rest of the world's governments to actually pay a fair price if they want to use our products.

lhopki01 10y ago
This argument would hold more weight if the pharmaceutical sector didn't have 17% profit margins. Only beaten by Banks, Financial Services, Shipbuilding, and Tobacco. http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/margin.html http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/... Also pharmaceutical spending on R&D is much lower than many other industries.
jbob2000 10y ago
Bullshit. Insulin was developed in Canada. Viagra was developed in the UK. Sure, 50% of the worlds pharma is developed in the US (as of 2010, it hovered between 30-40% until then), but most of the stuff people need has already been developed. So no, the majority of drugs that people use have not been developed by the American government.
- drakonandor 10y ago
  The motivation for this article is the Epi-pen, so let's look at that. https://en.wikipedia.org/wiki/Epinephrine_autoinjector https://en.wikipedia.org/wiki/Epinephrine_autoinjector Made in Good Old USA, based of USA Army prototypes. "But she also acknowledged that high retail prices of EpiPens in the United States effectively subsidize the cost of the devices when they are sold in Europe, at just $100 or $150. Many of the countries there have government-run health-care systems that limit drug prices charged by manufacturers, unlike the U.S." http://www.cnbc.com/2016/08/25/mylan-expands-epipen-cost-cutting-programs-after-charges-of-price-gouging.html http://www.cnbc.com/2016/08/25/mylan-expands-epipen-cost-cut... Oh, look at that, looks like the rest of the world -is- taking advantage.
  - tamana 10y ago
    Or the rest of the world pays a marketable price,and USA pays windfall profit and executive income. Nice way to quote the CEO "acknowledging" a propaganda claim, without attributing the source
jgeada 10y ago
Since a significant number of the world's largest pharmaceutical companies are not American (http://blog.proclinical.com/who-are-the-top-10-pharmaceutical-companies-in-the-world http://blog.proclinical.com/who-are-the-top-10-pharmaceutica...), I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D (https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-pharmaceutical-companies-are-spending-far-more-on-marketing-than-research/ https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...) I also doubt that research costs are as high as people claim. It is much more likely that, given our largely unregulated market for medicine, the market is pricing medicines in this country as expected by theory: as high as the market will bear. No ethics or morals apply, just pure profit. Whether that is OK or not depends on whether you happen to critically need those medicines and can afford them. Other countries are allowed to negotiate the price of drugs and/or restraint profits made, so their prices for the same drugs are often significantly lower. Companies in those countries still make a profit, just less than here.
- danielweber 10y ago
  > Since a significant number of the world's largest pharmaceutical companies are not American Those foreign companies sell to Americans using American IP law. > I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D This is irrelevant. You can't draw any conclusions from the fact that I spend more on taxes than on housing. > Companies in those countries still make a profit, just less than here. Not everyone can be the marginal customer.
  - jgeada 10y ago
    Seriously? 1- I was not the one claiming that the rest of the world is ripping off American drug companies. 2- the (obvious) point is that R&D isn't the major cost expense that was being posited in the original post. If cost of developing new drugs was inline with what the original post claimed, then you'd find both pharmaceutical companies profits being lower and fraction of expenses spent on R&D higher. Facts show otherwise, so primary cost of successfully doing business in pharma isn't drug development. 3- who said anything about marginal? Profit is profit. What we are discussing is the ethically justifiable profit rate. Pharma is one of the most profitable industrial segment in the US, with approx 20% net rate of return. As per the original article and related news stories show, these pharma companies are pricing many life saving drugs beyond what many can afford. At what rate of return is the pricing of life saving medicines no longer ethical? Please take into account that this is discussing how many people will be killed to protect/improve profits.

lhopki01 10y ago

This argument would hold more weight if the pharmaceutical sector didn't have 17% profit margins. Only beaten by Banks, Financial Services, Shipbuilding, and Tobacco. http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/margin.html http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/... Also pharmaceutical spending on R&D is much lower than many other industries.

jbob2000 10y ago

Bullshit. Insulin was developed in Canada. Viagra was developed in the UK. Sure, 50% of the worlds pharma is developed in the US (as of 2010, it hovered between 30-40% until then), but most of the stuff people need has already been developed. So no, the majority of drugs that people use have not been developed by the American government.

drakonandor 10y ago
The motivation for this article is the Epi-pen, so let's look at that. https://en.wikipedia.org/wiki/Epinephrine_autoinjector https://en.wikipedia.org/wiki/Epinephrine_autoinjector Made in Good Old USA, based of USA Army prototypes. "But she also acknowledged that high retail prices of EpiPens in the United States effectively subsidize the cost of the devices when they are sold in Europe, at just $100 or $150. Many of the countries there have government-run health-care systems that limit drug prices charged by manufacturers, unlike the U.S." http://www.cnbc.com/2016/08/25/mylan-expands-epipen-cost-cutting-programs-after-charges-of-price-gouging.html http://www.cnbc.com/2016/08/25/mylan-expands-epipen-cost-cut... Oh, look at that, looks like the rest of the world -is- taking advantage.
- tamana 10y ago
  Or the rest of the world pays a marketable price,and USA pays windfall profit and executive income. Nice way to quote the CEO "acknowledging" a propaganda claim, without attributing the source

jgeada 10y ago

Since a significant number of the world's largest pharmaceutical companies are not American (http://blog.proclinical.com/who-are-the-top-10-pharmaceutical-companies-in-the-world http://blog.proclinical.com/who-are-the-top-10-pharmaceutica...), I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D (https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-pharmaceutical-companies-are-spending-far-more-on-marketing-than-research/ https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...) I also doubt that research costs are as high as people claim. It is much more likely that, given our largely unregulated market for medicine, the market is pricing medicines in this country as expected by theory: as high as the market will bear. No ethics or morals apply, just pure profit. Whether that is OK or not depends on whether you happen to critically need those medicines and can afford them. Other countries are allowed to negotiate the price of drugs and/or restraint profits made, so their prices for the same drugs are often significantly lower. Companies in those countries still make a profit, just less than here.

danielweber 10y ago
> Since a significant number of the world's largest pharmaceutical companies are not American Those foreign companies sell to Americans using American IP law. > I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D This is irrelevant. You can't draw any conclusions from the fact that I spend more on taxes than on housing. > Companies in those countries still make a profit, just less than here. Not everyone can be the marginal customer.
- jgeada 10y ago
  Seriously? 1- I was not the one claiming that the rest of the world is ripping off American drug companies. 2- the (obvious) point is that R&D isn't the major cost expense that was being posited in the original post. If cost of developing new drugs was inline with what the original post claimed, then you'd find both pharmaceutical companies profits being lower and fraction of expenses spent on R&D higher. Facts show otherwise, so primary cost of successfully doing business in pharma isn't drug development. 3- who said anything about marginal? Profit is profit. What we are discussing is the ethically justifiable profit rate. Pharma is one of the most profitable industrial segment in the US, with approx 20% net rate of return. As per the original article and related news stories show, these pharma companies are pricing many life saving drugs beyond what many can afford. At what rate of return is the pricing of life saving medicines no longer ethical? Please take into account that this is discussing how many people will be killed to protect/improve profits.