2 f) Cost of Health Care (con’t)
- Drug Companies: I think most of you know that there is an enormous difference in the cost of many prescription drugs here when compared to buying the same drugs in another country (example: Canada), but do you know why?
U.S. Consumers Bear the Entire Burden of R&D — and More (from the website sited below)
American consumers pay roughly 3000 percent more than the actual manufacturing costs, because we are the only nation that does not have price controls and negotiate our drug prices. In a sense, we are bearing the cost of the world’s R&D. However, the prices Americans pay are still excessive — and in fact, drug companies are increasingly pocketing their huge profits rather than reinvesting them. For example, in 2002, 78 new drugs were approved by the FDA. Of those, only 17 were deemed by the FDA to have new active ingredients, and only seven were found to be improvements over the older drugs. On top of that, of the seven found to be an improvement over the older drug, not one of them came from U.S. companies. Read more: http://www.edrugsearch.com/edsblog/why-do-prescription-medications-cost-so-much-more-in-the-us-than-canada/#ixzz3RXxJDQkvr
It appears that we bear the cost for R&D and that sales to other countries, by manufacturers, are typically viewed as incremental sales that do not need to cover development costs?
Lawyers: Ambulance chasing has reached new heights. If you watch any TV you will witness the most recent form of abuse. It is difficult to watch even a couple of hours of TV without seeing a law firm seeking participants in a class action suit against a drug company for compensation. It is not my place to judge the efficacy of any of these drugs. I suspect that many are very harmful. I am addressing the cost of our health care system. These suits translate into higher insurance costs, all of which are passed along to the consumer. The USA leads the world in malpractice & bad drug law suits. In the US we have one lawyer for every 256 man, woman & child. We have the highest per capita ratio of lawyers in the world. I’m not sure this is a good thing. My take on this is that we produce too many lawyers and they need to create demand for their services to take advantage of their education (and also possibly to payback student loans). Again, I’m do not mean to excuse the responsibility to produce safe meds. Another example is the high number of physician malpractice suits in the US. Again, this increases insurance premiums which eventually get passed along to the consumer
Stay tuned, more to follow on this topic