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The Next Progressive Passion: Ending Drug Innovation September 30, 2015 2:00 PM | Tagged as Drug, Sovaldi
WSJ Sept 23, 2015, page A12: “The Assault on Drug Innovation” (editorial)
When The Biz Bucks Guy was in his MBA program twenty years ago, Dr. Alan Shapiro ask us an interesting question, “How many pharmaceutical drugs were developed in the former Soviet Union from 1917 (its beginning) to 1989 (it breakup)?” The answer is a nice round number…zero! Command economies don’t innovate. Whether you call it communism, socialism, progressivism, totalitarianism, the economy therein is run by the government. We can thank our market economy in the US for most of the innovations in anything, including pharmaceutical drugs.
But wait! Why should these Big Pharma companies make so much money? Isn’t it immoral that they charge so much to help people? Shouldn’t the poor have access to not only healthcare but the chemistry industry’s output? These are the questions of the left. You are now hearing from the left that ObamaCare did not go far enough. The left wants HillaryCare 2.0 which will bend the prices of drugs downward into the affordability range for all to partake whenever necessary.
The problem is it is largely governmental regulations that make drug innovation so expensive. Firms must recoup their R&D budget. They don’t hit homeruns every attempt.
When the market works, good things happen. Consider this account:
One of the big gripes from the left is the price for Sovaldi, the Hepatitis C drug. Originally, it cost over $80,000 to cure an individual. However, the treatment time was much less than other options which made the expense of the drug cost effective. Soon, much to the consternation of the left, other Big Pharma companies began to R&D in that area. The market was working. Now there are three competitors. This has caused price of this Hep C therapy to plunge. This is how our system works. Without a free market, Hep C victims would be in for a tough ride for a long time.
The left (specifically Bernie Sanders and Hillary Clinton) have made statements about price controls in the Big Pharma industry. The elitists think they know the true cost for a new drug. Where do they plan to divine that number from?
Kiss drug innovation good-bye if either one becomes president.
[Although opinion is included, The Biz Bucks Blog is primarily written to former students of Biz Bucks training courses to encourage their daily reading of the three opinion pages of the WSJ. This refreshes principles of Biz Bucks courses and improves business acumen on topics not discussed in Biz Bucks training.]
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