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Politics : Formerly About Advanced Micro Devices
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To: TimF who wrote (211180)11/9/2004 9:59:47 AM
From: Alighieri  Read Replies (4) of 1570288
 
Having the government be the main buyer of drugs or use pressure to lower the cost of drugs for a large segment of the country isn't capitalism.

No...that is not the definition of capitalism, but the practice of making companies compete for business is a key principle of capitalism. Let's ask the following question...do you think the fed should no bid buy everything else it buys on behalf of citizens?

Right now the US subsidizes the rest of the world because Americans pay the full price for drugs and many other countries force the prices to be lower. The high prices in the US pay for research and development, and since the marginal cost for production is usually low the drug companies can make money in the rest of the world as well. If the artificial distinction between the market for drugs outside of the US and those in the US is broken down by imports/re-imports of drugs from places with government controlled prices than you will have pressure to make prices higher in other countries and lower in the US.

Yeah?

In the best case scenario the other countries would raise prices some, we would lower it some and we wouldn't subsidize the rest of the world as much. Other plausible scenarios aren't so rosy. If the other countries don't let prices rise they may face shortages of certain drugs. Also if the prices don't rise overseas than research and development of new drugs will be less profitable and thus will receive less resources.

I think you have just described what's wrong with the non compete aspect of the Medicare bill.

Al
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