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Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

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Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#91

Post by jackhack »

FLUX-YOU wrote: post #48
geekamongus wrote: post #29

Earlier quoted context omitted.

The answer is that we buy health insurance, not health care.

The problem is that insurance costs continue to rise for no real reason. They even made costs rise when more people were insured because of ACA. In what world does that make sense?

>>no real reason

There is a very real and obvious reason. Thanks to the ("Affordable" Care Act, aka Obamacare), insurance companies have a captive audience of citizens (but interestingly, not illegal aliens) who MUST purchase their insurance product under threat of fine/imprisonment. There is no incentive to lower prices in this arrangement, and the insurance companies are immune from the pressures of a true competitive marketplace. The insurance marketplace is the equivalent of a prison commissary.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#92

Post by SaintGhurka »

Retric wrote: post #58
snarf21 wrote: post #18

Earlier quoted context omitted.

Yes, this is true. There are other things that would change too. We could have these (or other) pills for pennies. However, we can't have a 24 hour drive through pharmacy on every other corner and an Urgent Care on the other AND pills for pennies. Yes, the companies are making tons but a lot of that money pays for people to make it convenient for you to get your pills. And as someone else commented, we are basically…

McDonald's can have 24/7 drive though windows while selling burgers and fries, but most pharmacy's are not open close to 24/7.

Burgers and fries don't require clinical trials.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#93

Post by cryoshon »

gaius wrote: post #12
empath75 wrote: post #4

The answer is that our insurance and medical billing system is a complete tirefire and needs to be burned to the ground and replaced with something sane.

If the pill retailed for $0.04 in the US could the R&D be recouped? Americans should feel good about high drug prices: that's your aid to the Third World right there. Not the most efficient technique but still better than not doing it at all.

psst

(most money is spent marketing the drug, not developing it)

(marketing includes bribing doctors and healthcare systems to prescribe it)

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#94

Post by harryh »

ZeroGravitas wrote: post #90
sol_remmy wrote: post #74

Earlier quoted context omitted.

> They even made costs rise when more people were insured because of ACA. In what world does that make sense? I'm surprised you don't remember the reason because it was in the news 24/7. It's because insurance costs 10X for sick people (because they also draw 10X in insurance), those sick people could not afford their insurance, and the ACA gave those uninsured sick people deeply subsidized insurance, raising the ave…

The ACA reduced the rate of price rises, so it can't possibly be the cause of the price rises.

You and sol_remmy are talking about two different things. You are talking about overall expenditures in the health care system. He is talking about insurance prices charged to individual purchasers, in particular ones that are relatively young and healthy.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#95

Post by ZeroGravitas »

turc1656 wrote: post #68

What the article leaves out is that the real reason is that there are laws that were specifically passed to make import of drugs nearly impossible and illegal in most cases. The system is tightly controlled such that no price arbitrage can be had. This shit wouldn't fly with any other product. If it wasn't illegal, companies would be buying in bulk and importing to the US since the US price is literally 10,000x highe…

This seemed a great comment until the very last sentence. Are you really claiming that Congress wanted to fund the advancement of medicine globally, and they did so by banning imports of pharmaceuticals?

Surely there's simpler explanations for this that fit the facts better?

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#96

Post by notyourday »

Retric wrote: post #64
notyourday wrote: post #25

Earlier quoted context omitted.

It contradicts basic economics. If you raise prices 8000x and I will go into competition with you and raise prices 7999x i.e. do what MCI did to ATT and Vizio did to Samsung.

You don't get competition on day one, and one week of 8000x prices is worth more than 10 years of 1x prices. However, you can and will drop prices when competition shows up, so you see 8000x profits when competitors see a competitive market.

neither AT&T nor Samsung were able to do it against MCI or Vizio. But, sure, lets pretend it is different this time.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#97

Post by mabbo »

This is a great case where unregulated free markets absolutely fail to solve the problem. Companies like Impax Laboratories are sole-suppliers, and the cost to produce is the smallest cost, once initial capital costs are laid down to build the factories to produce them.

What would happen if a challenger appeared? A new company gets some funding to try to make a small number of high profit drugs, competing with Impax? Impax can drop their price on those drugs lower than the challenger until the challenger is out of money.

Any incumbent has already paid the initial capital costs, while challengers haven't. Challengers can't win unless they've got big enough pockets to equal the incumbent, or new techniques that let them undercut even the lowest price the incumbent can do. But in a field like this, where the lowest price is apparently in the pennies, I can't really see how you can undercut enough.

I don't really see any simple solution to this problem.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#98

Post by notyourday »

yequalsx wrote: post #76
notyourday wrote: post #51

Earlier quoted context omitted.

There's no cartel pricing in medicine. If there was there would be a competing cartel as it is the case everywhere . The reality is that companies that make generics are simply too small to be able to compete with Pfizer, Merc, Glaxo etc and for all big talk our scientists in R&D and FDA are bought and sold like trading cards and their opinions change with the opinions of their owners, which is, for example, why FDA…

Your view of economics does not match reality. A survey of hundreds of published economic studies and legal decisions of antitrust authorities found that the median price increase achieved by cartels in the last 200 years is about 23%.[1] Private international cartels (those with participants from two or more nations) had an average price increase of 28%, whereas domestic cartels averaged 18%. Less than 10% of all ca…

My view of cartels matches non-academic reality. Here's one:

OPEC

here's a non-member ( which is basically a cartel by itself) fucking it for them:

US

Here's another cartel:

Siemens and Mitsubishi Heavy Industries

Here's a competitor: Hyundai Heavy Industries

When real world meets economic studies, economic studies get clobbered

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#99

Post by notyourday »

mikeash wrote: post #53
notyourday wrote: post #5

Earlier quoted context omitted.

I'm baffled by the snark. Could someone please attempt to reconcile the following positions for me: 1. We need regulation of drugs/medicine/etc because we do not want some snake oil peddlers peddling arsenic as medicine? 2. Regulations prevent us from getting shit cheap! Baaaaa!

Safety might be a good reason to prohibit imports from a place like Tanzania, but it makes no sense as a reason to prohibit imports from Canada. Canada has some equivalent to the FDA which is about as good as ours, so there should be no safety problem when it comes to importing their medicine.

We do not have reciprocity agreement with Canada regarding drug approvals.

Re: Why a Pill That's 4 Cents in Tanzania Costs Up to $400 in the U.S

#100

Post by notyourday »

vorotato wrote: post #84
notyourday wrote: post #5

Earlier quoted context omitted.

I'm baffled by the snark. Could someone please attempt to reconcile the following positions for me: 1. We need regulation of drugs/medicine/etc because we do not want some snake oil peddlers peddling arsenic as medicine? 2. Regulations prevent us from getting shit cheap! Baaaaa!

Both of these things can be true?

Only if you can define lines.
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