[soneil]

It's nothing to do with IP; Simply what the market is willing to pay. We're not buying knockoffs, or violating anyone's IP (I'm european). In fact, the article claims the US buys more generics than we do.

We just have a completely different market, and the prices reflect that. With state-sponsored healthcare, you have one buyer who represents a vast proportion of a nation's market. The economics become reaching most the market on a narrow margin, vs reaching a tiny market on a more favourable margin.

Apparently the narrow margin scales to beat the private margin, based on those sales being made.

[msandford]

It does have to do with IP. If there was a worldwide IP regime in place, EVERYONE would have to pay what the drug companies demanded, or let their citizens die without the drugs (in countries with single-payer).

Since the drug companies know that Canada or countries in Europe could -- if they so chose -- make new laws that strike down the validity of their patents. But that would take time to do and require specialized laws that only dissolved drug patents or whatever. So they sell the drugs cheaply.

There's no negotiating like that here in the US because this is where the major pharma companies are headquartered and where they spend a lot of money lobbying for excellent protections. As a result their patents are safe here.

But their patents are not safe overseas which is why those countries tend to get a better deal on their drugs on the whole. It's different because those involved in the buying can alter the regulatory environment. Those involved in the buying here can't make such a credible threat and as a result, higher prices.