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

To: Joe NYC who wrote (6455)	3/24/2009 5:32:21 PM
From: Peter Dierks	Read Replies (1) \| Respond to of 42652

Of course it is possible that reimportation would reduce costs in the US in the very short run. Shortages in the intermediate supplying countries will correct the problem. Soon there will be no drugs available for reimportation. The end result needs to be that US consumers no longer pay the lions share of medical research expenditures.

To: Joe NYC who wrote (6455)	3/24/2009 5:35:41 PM
From: i-node	Read Replies (1) \| Respond to of 42652

>> This is the one I don't object to at all. If the drug makers are willing to give discount to, say, Denmark, why not the US? I don't object to it at all. It is fine with me. Here's a protracted example. Suppose Drug X is developed in the US at a cost of a billion dollars. The direct (variable) cost to manufacture one "dose" is $1.00. If they sell a billion doses in the United States at $2.00 they recover their R&D costs (ignoring fixed costs which are, of course, fixed, so they don't matter). Then, everything else they make is profit. Now, suppose they can sell 3 billion doses in Africa, Europe, etc., at an average of 1.25/dose. The result is that there is $0.75B available to apply toward R&D cost recovery. Americans are angry because the drugs are less expensively elsewhere, but in reality they are HELPED by the less expensive sales in other countries. Why? Because faster R&D cost recovery by the manufacturer translates to that same company being able to reinvest in more R&D which benefits ALL people who are sick regardless of country. One could argue that it isn't fair that Americans pay $2 for a drug that others pay $1.25 for. So, suppose the price of Drug X is capped at $1.25 in the US to try and make it fair. In that instance the R&D recovery period is longer which means that the reward from developing a new drug is decreased which means the drug companies will be less apt to do the R&D, with the end result being a slowing down in health care progress. I think reimportation is fine for those who want to do it; it is personal prerogative. But if we start moving toward protectionism, we are all hurt by it as long as most R&D happens here (which it does for right now, at least). When you start taking the profits out of the medical business, the best minds in the world are going to find a more profitable way to make a living.