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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: Lane3 who wrote (3079)	12/5/2007 6:47:00 AM
From: Road Walker	Read Replies (1) \| Respond to of 42652

The answer is "no." There's a fixed allowance for overhead and profit in government contracts. Not enough to bring new drugs to market. We're talking defense contractors. "Overhead" includes R&D. Otherwise they would be broke.

To: Lane3 who wrote (3079)	12/5/2007 9:26:49 AM
From: Mary Cluney	Read Replies (1) \| Respond to of 42652

<<<The answer is "no." There's a fixed allowance for overhead and profit in government contracts. Not enough to bring new drugs to market.>>> As an example, from what I understand when a company bids on a government contract, they would normally allow for all their expenses: Cost(labor, benefits, taxes and material)+ Overhead + Profit Overhead would include all indirect expenses to the company. That would include a pro-rated portion of their G&A,R&D, and a contingency for unexpected costs. I don't think its possible for government to come up with a fixed allowance for overhead. Different business models have different cost structures. All contracts are negotiable.