[drakonandor]

America's prices are a subsidy for the rest of the world, whom relies on American medications that they often outright infringe ownership of.

Say what you want about America, but it can't be denied that the majority of drugs in the last few decades which the world depends on has been thanks to the American government, American companies, and the American people.

One way to fix the price would be simply to stop giving away our inventions for pennies, and get the rest of the world's governments to actually pay a fair price if they want to use our products.

[jgeada]

Since a significant number of the world's largest pharmaceutical companies are not American (http://blog.proclinical.com/who-are-the-top-10-pharmaceutica...), I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D (https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...) I also doubt that research costs are as high as people claim.

It is much more likely that, given our largely unregulated market for medicine, the market is pricing medicines in this country as expected by theory: as high as the market will bear. No ethics or morals apply, just pure profit. Whether that is OK or not depends on whether you happen to critically need those medicines and can afford them.

Other countries are allowed to negotiate the price of drugs and/or restraint profits made, so their prices for the same drugs are often significantly lower. Companies in those countries still make a profit, just less than here.

[danielweber]

> Since a significant number of the world's largest pharmaceutical companies are not American

Those foreign companies sell to Americans using American IP law.

> I find this statement dubious to begin with. And since pharma companies spend more on marketing than they spend on R&D

This is irrelevant. You can't draw any conclusions from the fact that I spend more on taxes than on housing.

> Companies in those countries still make a profit, just less than here.

Not everyone can be the marginal customer.

[jgeada]

Seriously?

1- I was not the one claiming that the rest of the world is ripping off American drug companies.

2- the (obvious) point is that R&D isn't the major cost expense that was being posited in the original post. If cost of developing new drugs was inline with what the original post claimed, then you'd find both pharmaceutical companies profits being lower and fraction of expenses spent on R&D higher. Facts show otherwise, so primary cost of successfully doing business in pharma isn't drug development.

3- who said anything about marginal? Profit is profit. What we are discussing is the ethically justifiable profit rate. Pharma is one of the most profitable industrial segment in the US, with approx 20% net rate of return. As per the original article and related news stories show, these pharma companies are pricing many life saving drugs beyond what many can afford. At what rate of return is the pricing of life saving medicines no longer ethical? Please take into account that this is discussing how many people will be killed to protect/improve profits.

[drakonandor]

3. The problem is, if you say that Pharma profits s/b illegal, the companies will simply stop risking money on figuring out new treatments. The European governments ride their high horses and refuse to pay a fair price for private pharm company inventions, BUT they also refuse to make meaningful contributions themselves - which is WHY there's such a huge private pharma industry in the first place.

[danielweber]

> Seriously?

Yes, seriously. I get that you are smart, but there are smart people in the world with different outlooks than yours.

> 1- I was not the one claiming that the rest of the world is ripping off American drug companies.

You brought up foreign drug companies, as if their existence proves American IP laws aren't needed for drug development. The reality is that the biggest market is America. Roche is a Swiss company but America makes up nearly half of its revenue, way more than Europe, despite Europe being larger on PPP measures and its own home country. You can't write off America and say that other countries will still invent drugs, because they are inventing drugs on the basis of American laws.

> - the (obvious) point is that R&D isn't the major cost expense

It is indeed a major expense, one of many. If a company spends more on taxes than on personnel it doesn't mean personnel aren't extremely important.

> who said anything about marginal?

Me. And you when you said that pharma companies were still profitable selling in other countries.

Obviously the companies are profitable in other countries, in the sense that they are not losing money on each sale. It doesn't follow that they could make money if every country compensated them as if they were the marginal customer.

An airline will sell me a seat at the last minute for $40 rather than let it go empty. That doesn't mean that they are cheating people who paid $400 when booking months ago, or that there is a way of operating the airline by selling $40 seats to everyone and we only need to get tough with our airline companies to force nirvana to happen.

Please take into account that this is discussing how many people will be killed to protect/improve profits.

Emotional language like this used to work on me. But since I am no longer in middle school, it doesn't. Sorry.

Adults recognize that life and death decisions are made every day based on money. All procedures and drugs have some break-even point. Doctors can retire instead of putting in more years because they are done. All sane medical systems have a threshold at which it no longer becomes worthwhile to do a medical procedure even if necessary to save someone's life.

If you are going to whinge about "what is ethical," let's point out that no one is stopping you from discovering the next great wonder drug. No one. Go do it. And give it away. Or whatever you want. No one is stopping you from doing this. Oh, you don't want to do that? It's much easier to instead tell the people who actually do the life-saving work how to run their lives? Well, okay, I guess that is easier.

You can't yank out the rug from underneath the pharma industry and just assume that it will continue to deliver results. If you want to think you are being "ethical," then stop messing with a system that is continually adding things to the public store of knowledge when you don't know what you are doing. The drugs going off-patent each year are amazing. I have family members who would not be functional without some of these drugs. If some pinhead had decided 40 years ago to put a spoke into the industry's wheels because they didn't like the word "profit" these generics might not be available.

[lhopki01]

This argument would hold more weight if the pharmaceutical sector didn't have 17% profit margins. Only beaten by Banks, Financial Services, Shipbuilding, and Tobacco. http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/...

Also pharmaceutical spending on R&D is much lower than many other industries.

[jbob2000]

Bullshit. Insulin was developed in Canada. Viagra was developed in the UK. Sure, 50% of the worlds pharma is developed in the US (as of 2010, it hovered between 30-40% until then), but most of the stuff people need has already been developed. So no, the majority of drugs that people use have not been developed by the American government.

[drakonandor]

The motivation for this article is the Epi-pen, so let's look at that.

https://en.wikipedia.org/wiki/Epinephrine_autoinjector

Made in Good Old USA, based of USA Army prototypes.

"But she also acknowledged that high retail prices of EpiPens in the United States effectively subsidize the cost of the devices when they are sold in Europe, at just $100 or $150. Many of the countries there have government-run health-care systems that limit drug prices charged by manufacturers, unlike the U.S."

http://www.cnbc.com/2016/08/25/mylan-expands-epipen-cost-cut...

Oh, look at that, looks like the rest of the world -is- taking advantage.

[tamana]

Or the rest of the world pays a marketable price,and USA pays windfall profit and executive income.

Nice way to quote the CEO "acknowledging" a propaganda claim, without attributing the source