Peter Schiff defends Pharma: "It costs a lot of money to bring a prescription drug to market"

X ^ | May 12 | Peter Schiff

[RandFan]

@PeterSchiff

When Kamala Harris talked about price-fixing groceries, Republicans were correct to call her policy socialism. The same applies to Trump's desire to do something similar with prescription drugs. But as always, when government interferes with the free market, the plan will backfire, resulting in higher, not lower, prices for prescription drugs in the U.S.

Thanks to overly burdensome FDA regulations, it costs a lot of money to bring a prescription drug to market. As a result, pharmaceutical companies have a finite period of time to recover their costs and turn a profit before their patent expires, and other companies that spent no money developing the drug can knock it off.

Also, for every drug that gets approved, five don't. So not only do drug prices need to be high enough for companies to recover the costs of developing the drugs they sell, but to recover what they spent developing drugs they never sell.

The U.S. is the main market for prescription drug sales, so that is where pharmaceutical companies look to recover their costs first. They supplement that recovery with overseas sales. But since the marginal cost of those sales is very low, they maximize their profits by selling in foreign countries at lower prices.

This is especially true in poor countries that could never afford to pay what Americans can. Pharmaceutical companies still make money on those sales, even if the price is much lower than what Americans pay. But if they charged people living in poor countries the same prices as they charge Americans, the collapse in sales volume would result in lower profits.

Now some of the foreign sales are not to poor countries, but other rich countries. But there, U.S. companies compete with foreign pharmaceutical companies, that sell drugs that might not even be approved in the U.S., and that spent much less to develop their alternatives. To stay competitive and win contracts, U.S. companies often sell their drugs for lower prices than what the same drugs sell for in America.

Trump doesn't think this is fair. So his solution is to force U.S. pharmaceutical companies to charge Americans no more for prescription drugs than what they charge to their poorest customers in the world. According to Trump, this will result in pharmaceutical companies slashing prices in America to match prices in Bangladesh. The opposite will occur. Prices in Bangladesh and all other countries will be raised to match prices in the U.S.

The result will be a decline in earnings for U.S. pharmaceutical companies due to collapsing overseas sales. Since those companies will now have lower foreign profits to offset the cost of developing drugs, the price they charge for all drugs will go up, including here in the U.S. So the net result of the president's plan will be to lower U.S. pharmaceutical company profits and raise the prices Americans pay for prescription drugs.

[TigersEye]

Thanks for that reminder! That’s probably bigger than the payouts on lawsuits.

[TigersEye]

1/3 is a lot.

I started noticing in the ‘90s that ads for lawsuits about Rx drugs were constantly popping up and it seemed to me that it hadn’t been that long before that there had been big ad campaigns to sell those same drugs.

That pattern has held through the 2000s and the 2010s.

I hope you weren’t one of those who had problems with Zantac.

[woodbutcher1963]

I was not. I did not take it often. However, I did have package of it in my office desk drawer when they took it off the market.

It definitely worked better than TUMS or Rolaids for heartburn.

FYI, my son is a Scientist for a major Pharma corp in MA.
He works in drug development. Mostly on cancer drugs.

[Veto!]

“Do you also avoid the seed oils: corn oil, soy oil, etc? What about excess sugar?”

Only use California Olive Ranch extra-virgin olive oil; Comes in a glass bottle, don’t want plastic. Good stuff. Sauté chicken thighs and Wild Caught Alaskan salmon in it. I steam little organic potatoes, serve them with olive oil on top, maybe parsley and fresh ground pepper too.

No sugar or honey. For desert, nonfat yogurt -Trader Joe has single serving black Raspberry, may have a little sugar, but yogurt has healthy probiotics in it.
Of course, other stores have yogurt too. Non-fat a little harder to find.

Don’t have a salt shaker and avoid anything that contains salt. Salad dressing is tricky, almost all are loaded with salt and yucky oils. Found one on AMZ that’s not perfect but OK

[Blennos]

Ditto on only using California olive oil. Don’t trust the others. Many are adulterated and old, despite the fancy imported names and bottles. Sometimes we splurge and order a set of fresh-pressed oils from the olive oil club. Great flavor, but pricey.

https://freshpressedoliveoil.com/

[TigersEye]

The best antacid I have ever used was Titralac. Small pills, best minty taste, dissolved quickly and easily and, most importantly to me, they worked exceptionally well. Never needed more than two.

My father, a family doc, first gave them to me in the ‘70s. After that I found them at Walmart until sometime in the ‘80s when they became unavailable. I searched for them again in recent years and found that they are still made in Australia but found no retail source in the U.S.

Now I use Gelusil tablets but they are big, somewhat chalky and it takes two to four of them depending on how much I screwed up my stomach.