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Posted on 05/12/2025 8:47:48 PM PDT by 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.
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It does cost a lot, but America should not be the only country that makes it a profit.
yes
and the socialist healthcare refuse to pay
we fund the research
Trump is making them pay
“Peter Schiff defends Pharma: “It costs a lot of money to bring a prescription drug to market””
and it costs WAY more for the tens of billions spent on TV ads and bribes to Congress ...
Granted, but when do we know they have recouped their research and approval costs and start making a real profit? Accountants are wizzes at hiding stuff in spreadsheets...............
lol yes the TV ads are incessant
Except the first paragraph, because realizing grocery prices and big pharma prices are no where near the same thing .. completely different ,, the whole premise of this idea is based on a complete false thought .
the real reason...
if other countries were charged the US prices.
these countries would retaliate by not honoring the patent.
and just make the stuff themselves
I hate all pharmaceutical drugs. They should NOT be allowed to advertise on TV.
My MD is from Nigeria, best doc I ever had. Went to med school there, where they are NOT funded by pharmaceutical companies. He didn’t think I needed a covid vax or any other. I take one prescription drug. Never sick. Had a cold about eight years ago, lasted five days. Nothing since.
My MD gave me an “Extended prescription list” that lists all of the vitamins and. minerals he wants me to take. More interested in keeping me healthy than curing anything I might get, It works. He says I’m the healthiest person my age he’s ever seen. Will be 89 in June.
Weigh 116, try to exercise 30 minutes a day. Eat organic veggies, pasture-raised eggs, no wheat, beef or pork. Free range- chicken, Alaskan wild-caught salmon, organic tofu for dinner, rotate them every night. Safeway has best imaginable deal on Alaskan salmon. Walmart has a different brand, far more expensive.
“ yes
and the socialist healthcare refuse to pay
we fund the research
Trump is making them pay”
****************************************
Yep, Trump is moving toward eliminating the “free riders”.
How is he making them pay?
Yes, let the Rats defend Big Pharma’s pricing. That will win them lots of votes, NOT!
There is no excuse for Americans paying more than others. All Trump wants is to make sure that Americans are paying no more than anyone else.
That isn’t much to ask.
You’d think the left would be happy that Trump is trying to make others “Pay their fair share”.
/s
sure..... in favor of soaking the U.S. for all the developement cost....
and making nothing but profit from other countries...
That's why snow birds go across the border into mexico to get their meds filled.
maybe $500 cash price for a med in the U.S., would be possibly as low as $50 in mexico...
older article... first I found because a search comes up with so many ads
https://www.npr.org/sections/health-shots/2019/02/11/691467587/americans-seek-cheaper-meds-in-mexico
The theory is, if Sweden is paying $100/month for Ozempic and the US is paying $1000/month and with this new executive order about price negotiation is effective and the US cost is reduced to $200/month then the drug companies will negotiate higher prices in Sweden and elsewhere to keep up their profits
I agree with the concept, most if not all the drug prices US Consumers pay are multiple times higher than the rest of the world pays for the same drugs, plus we allow drug companies to advertise when most other countries do not
Europeans love to bash U.S. healthcare, even though they are ignorant about it, but I don't see them ever being forced to come to that conclusion.
Research for many drugs are paid for by the federal government. In many instances, the rights for successful drugs are pretty much given to Big Pharma companies.
There is also the practice of “Evergreening”. That’s when Big Pharma that is about to have a patent expire and they make a very minor insignificant change to the drug and then are awarded a new patent.
Plus there’s all those legal bills and payouts when the class action lawsuits come five years after the drug goes on the market.
It does, and the present patent system creates an incentive for drug companies to rush to market as fast as possible and charge as much as they can, because they only have 20 years from the date the patent issues to earn back all the R&D cost before the drug can be copied by anyone. Yet no one ever talks about extending the patent life for pharmaceuticals which would remove this incentive.
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