Big business vs free markets

[Tom Kirkham]

Thought provoking article on Big Business...

http://pajamasmedia.com/blog/big-bus...-free-markets/

[lineslinger]

Thanks for the link. Concise and clear.

[Anthony]

Healthcare reform failure reminds me alittle like Midway.

prescription costs are a big percentage of medical dollars.

In 2002, for Medicaid, it was about 16%

http://findarticles.com/p/articles/m...g=content;col1

Pharma is doing what any company would do, bargain with the government for their piece of the pie, at the expense of other players and the general public. Was always like that in the past, and will always be like that.

[Dan40]

All deals with the devil end up with the same winner!

I'd say that right now we are at an EXTREMELY low ebb of corporate wisdom. Too many large companies are NOT headed by the "best and brightest," But by the most political and most sleazy. So many examples of change for the sake of change so an executive can 'leave his mark,' on a company. Or product development aimed at multiple new products rather than making the existing product the best it can be. New products, however badly NOT needed, make a big splash. Tiny evolutionary improvements are barely noticeable.

[Wes Tausend]

...

From where I see it, some of this is exactly what I have been frequently trying to say:

From Tom's link:
Adam Smith wrote over 200 years ago that “people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

In this above quote, and other references in Tom's link, substitute the principle "labor union meeting" for "corporation board meeting", and you will find that they are the same creature in different cloaks, each subject to a united selfishness for their own benefit. Corporations are, in effect, unions of business owners, in it strictly for their own power and monetary gain. Too much power in the hands of any few, is not a good thing, the principle that drove Barry Goldwater to tackle labor unions so long ago. Now the shoe is wholly on the other foot. We as a nation, again walk precariously unbalanced.

Another quote:
"These capitalists generally act harmoniously and in concert, to fleece the people."
.................................................. .................................................. .Abraham Lincoln

Or substitute union members for capitalists and read, "These union members generally act harmoniously and in concert, to fleece the people.".

In effect a union member, too, acts as a capitalist trying to power leverage his best possible wage during negotiation.

I always thought Honest Abe called a spade a spade, so is this a spade or not?

Wes

...

[BeanCounter]

Wes,

You're right on the mark. People worry that this country is governed by the extremes today. Well it's always been that way. The pendulum swings from one extreme to the other. We can only enjoy it as it makes it pass through the middle.

[Stentor]

Originally Posted by Anthony

prescription costs are a big percentage of medical dollars.

In 2002, for Medicaid, it was about 16%

http://findarticles.com/p/articles/m...g=content;col1

Pharma is doing what any company would do, bargain with the government for their piece of the pie, at the expense of other players and the general public. Was always like that in the past, and will always be like that.

According to CMS (agency of US government), roughly $250 billion was spent on drugs (branded and generic) in the US last year. That pales in comparison to the almost $1.3 trillion that was spent on hospital and physician services.

While PhRMA cut a deal with Obama, the AMA and physicians aren't rolling over either when it comes to health reform (e.g., lobbying heavily against proposed 21% decrease in physician reimbursement under Medicare scheduled to go into effect next month; it will cost upwards of $200 billion if the decrease in reimbursement isn't enacted). All parties are trying to cover their arses.

[Dan40]

And once again today the health care "reform" fight is on again as Obummer puts forth his rewrite of the Senate bill. Another 2000 pages of gobbledygook claiming the impossible. Cover 30 million more people and eliminate pre-existing conditions denials. Wonderful ideas, just impossible. More coverage, less money, STUPID on the face of it. Only way to have less money is less coverage, simple logic. Not politically salable, but logical. Also any health care [insurance] bill that is more than a few dozen pages, if that, is going to cost MORE. Pages mean complications. Complications COST. We all know that.

We need the Government OUT of health care, NOT deeper and deeper into it.

[Anthony]

Originally Posted by Stentor

According to CMS (agency of US government), roughly $250 billion was spent on drugs (branded and generic) in the US last year. That pales in comparison to the almost $1.3 trillion that was spent on hospital and physician services.

While PhRMA cut a deal with Obama, the AMA and physicians aren't rolling over either when it comes to health reform (e.g., lobbying heavily against proposed 21% decrease in physician reimbursement under Medicare scheduled to go into effect next month; it will cost upwards of $200 billion if the decrease in reimbursement isn't enacted). All parties are trying to cover their arses.

It depends upon your perspective I guess. To me, if 17% of all healthcare dollars is spent on meds, to me that is a huge figure. Considering I worked for a pharmaceutical company, making drugs. I kind of have an idea what the productivity/cost of producing drugs is. If I remember correctly, one machine, run by one person, could make 20,000 pills / hour. Granted, there was labor also involved in material handling, blending, and team of workers for packaging, as well as sometimes coating and imprinting. I think the profit margin is pretty good in making drugs, although I was never privy to the financial details of my company.

The cost of "hands on" healthcare, doctors, nurses, is expensive, but obviously it is very labor intensive. There is also some good money in DME's, implants, etc.

The problem with decreasing reimbursement to doctors/hospitals, is that they will start cutting back on the services they provide to you/us, if they haven't already. Ever wonder why your doctor will not call in prescriptions for you anylonger, and make you come in for a visit? Office visits are getting shorter and shorter, with less one on one time? Doctor's only want to address one problem during an office visit, instead of multiple problems? If the government pays less, you will get less service.

[tfalk]

Originally Posted by Anthony

I kind of have an idea what the productivity/cost of producing drugs is. If I remember correctly, one machine, run by one person, could make 20,000 pills / hour. Granted, there was labor also involved in material handling, blending, and team of workers for packaging, as well as sometimes coating and imprinting. I think the profit margin is pretty good in making drugs, although I was never privy to the financial details of my company.

The real cost of making the drug isn't the actual manufacturing of it. It's the cost of developing it in the first place as well as the trials, certifications and insurance for potential liability down the road. That's really what we are paying for...

[427sharpe]

Recall a few years back that [i]60 minutes[i] ran an expose on Phizer (?) when they found out that one of their high dollar drugs was also provided to vets for horses at a drastically lower cost per. When they did the normal ambush to CEO thing, the guy didn't even blink, just replied, that he had never had a horse win a multi-million dollar verdict from a sympathetic jury! See; it really IS all the damned lawyers fault!

[Anthony]

Originally Posted by tfalk

The real cost of making the drug isn't the actual manufacturing of it. It's the cost of developing it in the first place as well as the trials, certifications and insurance for potential liability down the road. That's really what we are paying for...

Well, yes. Lets take it even a step or so further. The real cost of a drug is not only the cost manufacturing it, it's the cost of developing it in the first place, certifications, etc. It's also the cost of trying to develop the 20 drugs before it that failed to show significant positive effects. It's the cost to market the drug, drug reps, advertising, etc. as well as the profit.

However, there are some drug companies that predominately manufacture generic drugs, who didn't have to do the research, patient trials, etc. They basically just set up shop and make them, and sell them.