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

To: J_F_Shepard who wrote (4550)	2/15/2008 6:43:00 PM
From: TimF	Read Replies (1) \| Respond to of 42652

The US market does not provide 48% of world sales... US companies have 48% of sales in the US... Wrong, at least according to the article your defending. "The US accounts for just under 48% of world sales" bmj.com So once again, either the articles data is simply wrong (in which case why do you support it so much), or it confirms my point. Your disproportionate argument is specious.....it's silly. Nothing specious about the idea that if nearly half the income comes from one country that it accounts for the lions share of the incentive for investments in R&D and testing. Investments are made in order to get a positive return. The US with 300 million people gives 48% of sales. Europe with 728 million people, gives 28% of sales. Push down the revenue per person to European levels and you lose a lot of the profit. In Europe you have about one percent of world wide sales for each 26 million people. 300mil/26 mil is just over 11.5 48 - 11.5 is 37.5%. So you lose 37.5% of the revenue. But maybe Americans would use more drugs per person, and have higher average revenue even with European prices. Fine lets say they use 50% extra per person. That still leaves you with 48 - (11.5 * 1.5) or a reduction over over 30% in revenue. Chop 30% off the revenue off the top (and more than 30% of the profits, because you have overhead costs that won't go down or will only go down slowly) and you think you don't decrease investment?? How much of the world's energy do we consume with that 5% of the world population......28%....30%? If it was .01% or 100% it would still be meaningless in this context. It is relevant to the incentive for investment in R&D and testing to produce new drugs. Apparently you think my point is that its somehow wrong for different countries to have different percentages of the burdens and/or benefits from different activities. If that's what you think you seriously misunderstand the argument. The argument has nothing to do with such a silly idea. It a simple practical argument that if you put price controls, or monopsony buyers in place in the only large market that currently doesn't do much to force prices down, and which accounts for the lions share of profit, than you will reduce investments in new drugs, likely by a large amount.