Comment by ta988
3 years ago
Something I saw in drug pricing conferences is that there is a push to price drugs according to how much personal and social benefit they provide and how much a person would be willing to pay to extend their life or resolve a condition. An extreme example for that model, if a drug allow a kid to survive and have a productive life it can be priced millions whereas a palliative drug could be much cheaper.
This has nothing to do with research and cost of development anymore (if it even ever did).
But so two patients in different financial circumstances would both pay basically as much as they are able for a life-saving treatment, arriving at very different amounts, right?
- that sounds a lot like ransom?
- I think if they adopt a policy of price-discrimination to the point of literally taking you for all (or most) of what you're worth (or projected to be worth), we should turn around and apply the same reasoning to corporate tax rates.
I met a researcher once who was doing what appeared to be groundbreaking research on cancer care. He had this beautiful, tear-jerker story about losing his wife that cast a rosy, altruistic hue on his research. When he was asked what the device would cost, he cheerily replied "whatever the market will bear." That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants.
That's not the problem, that's the reason almost all medical development happens in America.
Rich people from all around the world travel to American hospitals if they have serious health problems, not to public hospitals even in rich countries like Norway. Public healthcare works (poorly) as a way to distribute existing treatment, but is worthless at incentivizing development. Really, the entire world is unfairly parasitizing on Americans to fund medical research.
That is not true, look up medical outcome data. Most of europe is far ahead or even with the USA.
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Or rather America is siphoning market by having monopoly. My father works in pharma factory and wages have not risen almost at all since 20 years ago when it was bought by americans (by bribe to gov). Some drugs got 10x more expensive while workers and patients got it worse. This was ultra scam but even after change of owners it’s basically the same.
Capitalism works only with competition. But competition is against capital owners short-term extractionism (or rather against ceos who feels need to justify their pay). IMO solution is to let workers vote on CEO pay changes and punish white collar crime better and many problems of capitalism might get solved.
EDIT: IMO it won’t work as long as globalization can be exploited to suppress working class and avoid regulation
> That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism. Dude was living off of government research grants.
Do the drug companies in Europe do any different though?
I mean, sort of? Except, not really, because, "what the market will bear" is determined by what governments can negotiate - there's no Medicare Part D tying their hands.
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> That's always stuck with me -- the problem with American healthcare is the American interpretation of capitalism.
What should it cost instead?
> Dude was living off of government research grants.
Let's imagine his work comes to fruition. The drug is expensive but efficacious - is this not a good thing? Should the government have not helped fund this drug because now it's expensive?
The alternative is a world without that drug and without as much incentive to produce the drug. I'm not sure that's a good trade.
> Should the government have not helped fund this drug because now it's expensive?
If he wants to charge "what the market will bear," then he should fund the research through the market.
If he wants government handouts to do the research then the public deserves to get the benefit that it's paying for - we're not funding it to make some guy rich.
I'm not saying it should be free, but he's already opted out of the market, so he loses out on market pricing. Manufacturing cost plus some reasonable percentage for the creator.
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> Should the government have not helped fund this drug because now it's expensive?
No, the government should set a reasonable price for the product they funded. A high enough price to fund manufacturing, a low enough price to ensure that people who need the treatment have ready access to it. If the upper bound on price is too low for universal access, that's what subsidies are for.
Instead, we have free money to bootstrap extractive capitalists, at cost and detriment to people who need care.
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> What should it cost instead?
To patients? It should be free.
To society? The initial research cost plus the bare manufacturing cost.
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I’m sorry, but that’s a non sequitur. The alternative is not that the drug wasn’t produced. It is that the drug wasn’t developed by private enterprise.
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