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To: BGR who wrote (95638)	2/7/1999 12:02:00 AM
From: Skeeter Bug	Read Replies (1) \| Respond to of 176387

still can't answer the micron question? ;-) i actually like and own trps and they are in the drug discovery industry. not confused at all. if i have the only drug that impacts disease x (no alternatives), then my price wouldn't be impacted by the development of other drugs, assuming no regulatory issues and no philanthropy. sometimes prices will be lowered in order to keep regulators, govt and public perception at bay. that is a reality. it has nothing to do with the development of other drugs. separate issues. my price wouldn't drop. why should it? disease y now has 30 cures, but my disease x has one. you come to me and i control supply and, therefore, pricing. why do you think monopolies are sought after? they control supply and pricing. now, if your drug discovery improvements enabled others to develop 1 or more competitors and bring it to market then we have supply growing b/c 2 or more companies are now competing for the demand. if demand grows fast enough to absorb all the new competitor's capacity then pricing wouldn't have to fall. i'd suspect that, if this were the case, both companies would ramp output to fill the unmet demand (increase profits). they would do so independently (there are laws against collusion - why? so supply can't be controlled in a non competitive environment. why not allow supply to be controlled? price fixing). prices would come down in this competitive environment when the supply of the drugs outweighs the demand and the only alternative to gain share is through price competition. you miss one very important fact. prices are lowered ONLY when it is forced upon a company. they don't do it to be good samaritans (again, i'm assuming business is the goal and not philanthropy). technological advances don't force companies to lower prices. supply and demand imbalances do. the threat of regulation (price controls) will. not technological advances, in and of themselves. companies use technological advances to improve their bottom line, not to support a form of market welfare. the fact that supply and demand force price reductions is a separate issue. advances due tend to increase supply. what has happened is that the printing of extra cash and the lowering of interest rates increased investment, which, in turn increased capacity (some of which is related to tech advance and some of it not related to tech advance) the excess capacity then leads to supply growing faster than demand and prices fall. that is what happened. if the horse is falling prices, the cart is a supply and demand imbalance. ps - name one company that is a monopoly, with essentially no alternatives, in a market where demand exceeds supply (at current prices) that lowered prices (any industry)... just one... don't use a company that is interested in philanthropy and don't use a company that is scared of regulation or other such things. name a company that did the absurd. it has happened. i can't think of any off hand. however, it is still absurd if profit is the motive.