The pharmaceutical industry and free markets

From: Rue The Day (ruetheday_at_outgun.com)
Date: 07/04/04 

Date: 4 Jul 2004 15:37:30 -0700

I find it quite interesting that much of the news coverage I've seen
recently regarding the cost of health care (in particular
pharmaceutical costs), the re-importation of Canadian drugs into the
US, etc. have centered around finding market solutions to the problem
vs government solutions. In reality, there is almost nothing
whatsoever about the pharmaceutical industry that could be described
as a "free market".

1. Costs are artificially inflated by the regulatory requirements of
the drug approval process.

2. Pharmaceutical firms reap monopoly rents due to patent law.

3. The actual consumer of the pharmaceuticals pays little of the price
out of pocket. The price is generally paid by insurance companies
which are themselves directly or indirectly subsidized by the
government.

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