Posted on 09/23/2020 8:26:36 AM PDT by Kaslin
For a long time, other nations have been free riders on America’s innovative pharmaceutical industry. Worse, they have enacted socialist price controls to limit what they pay knowing that the largest market would pick up the slack to ensure a steady supply of new lifesaving drugs. It needs to stop, but President Trump’s recent executive order is not the right way to do it.
Earlier this month, the president signed his “Most Favored Nations” Executive Order to test a program limiting prescription medication payments made through Medicare Part B and Part D to the lowest rate paid in similarly developed OECD member nations.
The idea behind it is that other nations are getting a deal from pharmaceutical companies and that the U.S. should get at least as good an arrangement as any other nation. But this is a flawed way of thinking about the problem.
Other nations are not getting deals; they are engaging in theft via price controls. The fix is to stop them from doing so and protect U.S. innovators, not to also engage in theft by imposing those same price controls domestically.
The latest drugs can take months or even a year longer to arrive in countries with socialist healthcare systems. Patients suffer as a result, but the central planners have decided they are willing to accept that and other trade-offs to keep costs down.
Forcing those trade-offs on American patients accustomed to care on demand without all the delays and shortages associated with socialized systems would be bad enough. But in some cases, the new price control regime may even drive prices higher.
If the U.S. is the most important market for manufacturers seeking to recoup development costs, then it may sometimes make sense to leave the foreign markets altogether to avoid setting a low U.S. price. The revenues that would have come from those markets, even when suppressed by price controls, would then need to be made up for by charging U.S. customers even more.
While it is possible that enough drugs avoid foreign markets to put pressure on governments to stop manipulating prices, remember that they’ve already accepted substandard care as the bargain for a socialized system. Perhaps one day patients force them to reconsider, but it could require decades of higher drug prices in the U.S. before that happens, if ever.
If the U.S. is the most important market for manufacturers seeking to recoup development costs, then it may sometimes make sense to leave the foreign markets altogether to avoid setting a low U.S. price. The revenues that would have come from those markets, even when suppressed by price controls, would then need to be made up for by charging U.S. customers even more.
While it is possible that enough drugs avoid foreign markets to put pressure on governments to stop manipulating prices, remember that they’ve already accepted substandard care as the bargain for a socialized system. Perhaps one day patients force them to reconsider, but it could require decades of higher drug prices in the U.S. before that happens, if ever.
Making the price paid for prescription drugs the same for all nations will not destroy the drug industry.
No. For too long the pharmaceutical companies have used American paten laws to keep prices high, but then allowing foreign nations to demand lower prices due to their socialized medicine schemes. We were in effect picking up the cost difference while subsidizing foreign nations. It is fine to allow a window of time for higher prices as the pharmaceutical company recoups their research investment, but allowing them to play both sides agains the middle is wrong. They should be forced to charge the same price for everyone! If Canada doesn’t like that then they can choose not to buy the drug. Or, we can get the Canadian price.
The author is simply saying the old status quo should remain, and Americans should continue to pay higher costs to retain care on demand.
The pharmaceutical developers have been using our high price structure to act as a safety net for the possible failures. Invention always requires risk. Time for them to understand that their huge profit margins need to apply everywhere they sell their products, or reduce those margins and recoup their costs over a longer period.
Take Trulicity for example - a home injectable Type 2 diabetes drug that stimulates the parient’s insulin production. ONE pen, or 4 weekly injections COSTS $800. Almost ten grand per year.
How many Type 2 diabetics are in the US?
How much does this medicine cost in Canada? I’ll bet a lot less.
If drug companies were taking a loss on sales to places that cap price like Canada they wouldn’t be selling there. I’m not necessarily for price controls, but damn drug companies have gotten silly with their pricing. Cause they see us as a captive market, that’s what we need to break.
Big Pharma, along with Big Lawyers, Big Insurance and Big Hospitals were all at the trough when Obamacare was being slopped. I feel they, along with the other three, should be held accountable.
The prices on orphan cancer drugs are in a class all by themselves. Here are some prices for some drugs for myeloma (most are orphan):
https://www.drugs.com/medical-answers/ninlaro-cost-compared-chemo-drugs-3538258/
They’ll never leave the foreign markets. It is unconscionable that America has been subsidizing foreign drug prices since at least the 1990s.
It’s time we put pressure on the foreign market so their prices rise and our prices come down. It’s not setting a price, it’s setting a standard that brings a fair deal for Americans. It’s up to the drug companies to set their prices overseas in a way that doesn’t penalize Americans. I think we should give this “favored nation” idea a chance. We should not be subsiding the world, same as demanding NATO countries pay their obligations or wealthy nations we protect pay us for our services.
Subsidizing*
If they can't make a profit because the US consumer pays the same as the kanucks or krauts, then just raise prices for everyone.
I sold computer systems to big pharma, and they are just taking advantage of uncle sugar, because they grease everyone in DC, EXCEPT TRUMP AND THEY CAN'T STAND IT.
Quinlan is a whore.
Easy to spot which bloggers and opinion writers are on the Big Pharma payroll, eh?
This article is painting big pharma as some kind of victim. That’s BS, they’ve been milking US consumers for decades. They’re not recouping development costs, they’re fleecing Americans with outlandish pricing because they can. As usual, President Trump is right.
Big pharma calls trump a socialist....lmfao.
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