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What literately every other country does: Old fashioned price controls. Government as a buyer or as a regulator puts a cap on the price through a process of neg

What literately every other country does: Old fashioned price controls. Government as a buyer or as a regulator puts a cap on the price through a process of negotiation, and be willing to say no when the price is too high and the benefits are too low. The UK's NICE body regularly rejects new products if they don't represent value. New cancer drug that extends life by two months but costs £10k per pill with a course of treatmeant costing £100k; no thanks. Its a market with inelastic demand - people will literately die if they don't buy the product. We, rightly, through regulation demand high quality assurance because if something is meant save someone from a quick death it better be reliable and not cause greater harm due to product defects. This means the entry barriers are quite high making competition difficult. Without price controls there is literately nothing but the CEO's conscience to keep from pushing the prices up. If the product will stop you from dying and nobody else can offer it, then there is basically no price you won't pay.

anexprogrammer 10y ago
There was a programme on R4 about NICE, drug companies and finance in health care a month or two back. I discovered two new (to me) things. First it's common for drug companies to tweak patent protected items suspiciously near end of patent - to find a new use, or reformulate a tablet as a capsule - to buy more patent period. Second in the case of off patent medicines, some are harder to make or not prescribed widely enough for the generic makers to bother with. These seem to be the things at risk of price gouging. There was an example of something off patent sold by Pfizer to another company who now charge 10x more, as there is no generic alternative. That's now at the competition authorities. So we mitigate a lot of this, but we apparently don't avoid it entirely. EDIT: Programme page with mp3: http://www.bbc.co.uk/programmes/b07j7j6m http://www.bbc.co.uk/programmes/b07j7j6m

anexprogrammer 10y ago

There was a programme on R4 about NICE, drug companies and finance in health care a month or two back. I discovered two new (to me) things. First it's common for drug companies to tweak patent protected items suspiciously near end of patent - to find a new use, or reformulate a tablet as a capsule - to buy more patent period. Second in the case of off patent medicines, some are harder to make or not prescribed widely enough for the generic makers to bother with. These seem to be the things at risk of price gouging. There was an example of something off patent sold by Pfizer to another company who now charge 10x more, as there is no generic alternative. That's now at the competition authorities. So we mitigate a lot of this, but we apparently don't avoid it entirely. EDIT: Programme page with mp3: http://www.bbc.co.uk/programmes/b07j7j6m http://www.bbc.co.uk/programmes/b07j7j6m