[lit-ideas] Re: vicious budget cuts

Eric Yost wrote:

"Yet Americans, for example, aren't subsidizing the cost of the
Brazilian drugs. Rather they are paying to increase the pharmas' stock
prices and (supposedly) helping to fund R&D for new drugs.  The drugs
the Brazilian government licenses are purchased above the cost of
manufacture."

As I understand it, the licenses allow the Brazilian government to
produce the drugs at a significant discount.  In this sense, the payment
is above the cost of manufacturing the drugs.  However, the cost for the
drug companies lies in R&D.  Furthermore, the cost is not merely for the
individual drugs but also for all the drugs that were developed but
found to be unsuitable.  That is, drug companies have to subsidize their
failures through the profits from successful drugs.  When governments
like that of Brazil set the cost they are willing to pay, they do not
allow for all the costs that drug companies incur.  In order to make up
for these losses, they raise prices elsewhere.  We experienced this in
Africa where second-generation drugs were available at a greatly
subsidized price because prices in Europe and N. America were much
higher than cost.  And personally, I am willing to pay more so that
Africans can have access to the same drugs rather than having to do with
third or fourth-generation drugs.

An interesting article I found is at:

http://tinyurl.com/dbyld

The concluding paragraph:

"Again, the multinational pharmaceutical manufacturers are not
innocents ? not good and deserving companies devoted to social
advancement. Corporations, by their very nature, have no souls. The
worst corporations are vampires, the best no better than robots. Many
industries provide products and services that are essential to modern
life in an interdependent society and none have a clear record of
putting public responsibility before profits. But, generally, societies
have managed to work with the industries through systems that assure
reliable services alongside fair profits. Only the pharmaceutical
industry has been placed in the position of direct confrontation through
regulation, price controls, and diversion of established markets ? and
then been castigated for fighting back."


Sincerely,

Phil Enns
Toronto, ON

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