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> monopoly presses down costs Yes, assuming the monopoly actually wants to keep its costs low. In the US, corporate-funded legislators made it so that Medicare

> monopoly presses down costs Yes, assuming the monopoly actually wants to keep its costs low. In the US, corporate-funded legislators made it so that Medicare is not allowed to negotiate drug prices. It willy-nilly pays whatever the private drug companies prices its drugs at.[1] This is why it's so profitable for companies to "purchase legislation". The return on investment is 10x or something insanely high, like in this case. Spend $10 million "donating" to the campaigns of a few unconscientious politicians, and soon you are milking an extra $100 million in profits from unwitting taxpayers. [1] http://healthaffairs.org/blog/2016/09/19/the-politics-of-medicare-and-drug-price-negotiation/ http://healthaffairs.org/blog/2016/09/19/the-politics-of-med...

willvarfar 10y ago
Bugs me to bits. I'm very glad I live in a much 'cleaner' country i.e. Sweden. Transparency could strip off lobbying. If we know who gets what money, and we know how people vote, a bit of clustering etc ought reveal patterns... What's needed is something gimmicky that gets popular appeal and covered on mainstream media for fifteen minute fame... E.g. an iphone app that you point at the live news on your TV and it OCRs the senator's name and queries opensecrets.org or something bigger and better and tells you how much money they got, from whom, and how this correlates with their voting record etc. Something that makes politicians accepting money very counterproductive.
- tracker1 10y ago
  Don't underestimate the complacency of the public.. Most of this information (campaign funding information) is publicly available in the US as well... it's just that most of the population doesn't care... they're more worried about one of those damned (insert other party here) getting into office.
gambiting 10y ago
I'm from Poland, where we have 100% national healthcare, and it's literally illegal for people or companies to donate to politicians to do anything. Or fund their campaigns, or pay for their holidays, or whatever - politicians are straight up forbidden from taking money from companies/people no matter what reason. So basically, our healthcare system plays hardball with suppliers, basically saying that we can pay X, or we won't buy your product at all - because it simply can't afford to pay any more.
- nickff 10y ago
  These strategies can allow governments to bargain down the cost of products to the marginal cost of production; the only problem is that if every buyer does the same thing, the supplier goes bankrupt (as it can't cover its fixed costs). This strategy also doesn't allow for any earnings to be retained for product development, and discourages investment in the field but those are separate issues.
  - grive 10y ago
    > the only problem is that if every buyer does the same thing, the supplier goes bankrupt (as it can't cover its fixed costs). The government is responsible for using a fair price, both for itself and the supplier. His non-profit nature ensure that it will not try to lower the price too far. If a politician is dumb enough to make companies go bankrupt, it's the responsibility of the people to vote him out of office. That's the only way to have a fair price on drugs. A free market cannot exist in these industries and the inelasticity of the demand will always, always distort the prices. Yes, America will have to face its demons and trust its government. The alternative is to continue paying exhorbitant prices to greedy scumbags and let fellow citizens die as a result.
  - abricot 10y ago
    They can, but that is not what all of them are doing. They realize that if they only cover marginal cost, and don't allow for development, they will only get the right product for a limited amount of time. What often happens is that they agree on a more realistic price that will allow for that. In many cases the company will go low to still be the supplier for a whole country - especially as they can still keep their margins in other countries, like US.
    - nickff 10y ago
      I think we agree on this, but the strategy of bargaining down to near marginal cost is dependent on the US customers paying for the fixed costs. The 'internationals' don't have to worry about doing safety studies or drug development either, so they can just take advantage of US companies doing the expensive work. For their part, the US government seems to know what they are doing too; they know they pay more for the drugs than anyone else, and do so to retain the industry. I'd compare it to a 'tragedy of the commons' scenario where one farmer keeps paying his son to re-turf the meadow, so the boy can have a job (and thereby feeds everyone else's sheep).
abawany 10y ago
From a quick read, it seems that this article does not talk about Pharmacy Benefits Managers such as Express Scripts. The latter are certainly not a full-fledged solution but another country-specific attempt to privatize for the sake of privatization. I agree that it is sad that the elected representatives in the US have worked so hard against the people they serve by hampering Medicare in this manner.
bonoboTP 10y ago
I live in Hungary and we're often fed up with the corruption we see here, but as I learn more and more about American corruption I'm not so sure we're that bad in the end.

willvarfar 10y ago

Bugs me to bits. I'm very glad I live in a much 'cleaner' country i.e. Sweden. Transparency could strip off lobbying. If we know who gets what money, and we know how people vote, a bit of clustering etc ought reveal patterns... What's needed is something gimmicky that gets popular appeal and covered on mainstream media for fifteen minute fame... E.g. an iphone app that you point at the live news on your TV and it OCRs the senator's name and queries opensecrets.org or something bigger and better and tells you how much money they got, from whom, and how this correlates with their voting record etc. Something that makes politicians accepting money very counterproductive.

tracker1 10y ago
Don't underestimate the complacency of the public.. Most of this information (campaign funding information) is publicly available in the US as well... it's just that most of the population doesn't care... they're more worried about one of those damned (insert other party here) getting into office.

gambiting 10y ago

I'm from Poland, where we have 100% national healthcare, and it's literally illegal for people or companies to donate to politicians to do anything. Or fund their campaigns, or pay for their holidays, or whatever - politicians are straight up forbidden from taking money from companies/people no matter what reason. So basically, our healthcare system plays hardball with suppliers, basically saying that we can pay X, or we won't buy your product at all - because it simply can't afford to pay any more.

nickff 10y ago
These strategies can allow governments to bargain down the cost of products to the marginal cost of production; the only problem is that if every buyer does the same thing, the supplier goes bankrupt (as it can't cover its fixed costs). This strategy also doesn't allow for any earnings to be retained for product development, and discourages investment in the field but those are separate issues.
- grive 10y ago
  > the only problem is that if every buyer does the same thing, the supplier goes bankrupt (as it can't cover its fixed costs). The government is responsible for using a fair price, both for itself and the supplier. His non-profit nature ensure that it will not try to lower the price too far. If a politician is dumb enough to make companies go bankrupt, it's the responsibility of the people to vote him out of office. That's the only way to have a fair price on drugs. A free market cannot exist in these industries and the inelasticity of the demand will always, always distort the prices. Yes, America will have to face its demons and trust its government. The alternative is to continue paying exhorbitant prices to greedy scumbags and let fellow citizens die as a result.
- abricot 10y ago
  They can, but that is not what all of them are doing. They realize that if they only cover marginal cost, and don't allow for development, they will only get the right product for a limited amount of time. What often happens is that they agree on a more realistic price that will allow for that. In many cases the company will go low to still be the supplier for a whole country - especially as they can still keep their margins in other countries, like US.
  - nickff 10y ago
    I think we agree on this, but the strategy of bargaining down to near marginal cost is dependent on the US customers paying for the fixed costs. The 'internationals' don't have to worry about doing safety studies or drug development either, so they can just take advantage of US companies doing the expensive work. For their part, the US government seems to know what they are doing too; they know they pay more for the drugs than anyone else, and do so to retain the industry. I'd compare it to a 'tragedy of the commons' scenario where one farmer keeps paying his son to re-turf the meadow, so the boy can have a job (and thereby feeds everyone else's sheep).

abawany 10y ago

From a quick read, it seems that this article does not talk about Pharmacy Benefits Managers such as Express Scripts. The latter are certainly not a full-fledged solution but another country-specific attempt to privatize for the sake of privatization. I agree that it is sad that the elected representatives in the US have worked so hard against the people they serve by hampering Medicare in this manner.

bonoboTP 10y ago

I live in Hungary and we're often fed up with the corruption we see here, but as I learn more and more about American corruption I'm not so sure we're that bad in the end.