Guest guest Posted January 15, 2004 Report Share Posted January 15, 2004 Hi , > I'd written: > >Is Canada offering American-produced drugs at lower prices? > responded: > Apparently so. I have personal experience of this when my husband needed > Cipro while we were in the US. It cost $10 a pill. Back home in Canada it > was only $5 a pill. Then there's the point-- the US is producing the drugs. Canada couldn't sell them so cheap if US companies making high profits weren't producing them. Moreover, US drug companies couldn't afford to sell the drugs so cheap to Canada if US consumers weren't paying such high prices. > > >What it was supposed to mean is that if the for-profit system the United > States has is responsible for the creation of the drugs, and other countries > > essentially de-engineer the drugs and produce generic copies, the only > reason they > can do so is because the US had a system conducive to producing the drugs in > > the first place. It's easier to bootleg a drug than to develop one. > > That's not true because the drug companies hold International patents on > their drugs! Yes, but Heidi's reference to drug companies witholding life-saving drugs was referring to South Africa's insistence they be able to bootleg the AIDS drugs-- I don't know what else she could have meant. > Generic drugs are available, and cost less than the " name-brands " but > doctors usually specify the name-brands (I wonder why? ha ha) and sometimes > specify that they are better. > BTW just because Canada is a socialist country doesn't mean there is > no free enterprise. Oh, I understand that. Actually, I wouldn't consider Canada remotely socialist, nor any of her European counterparts, in a technical sense. But I and you seem to defer to the more common usage of " socialism " to refer to redistributive mechanisms and government intervention, and, of course, the minimal actual socialist programs such as single-payer health plans, rather than countries in which the means of production and distribution are actuall owned and operated by the government. > >In a Libertarian view, neither the American system nor the Canadian system > > are very ideal. While the drug supplier in Canada is not forced to sell the > > products at a certain price, there is only one buyer due to socialized > health > insurance. > > This is not true. Drugs are not covered, we have to pay for them! You must be buying them from the government then, no? There is some sort of centralized buyer-- presumably the government-- that is using its bargaining power to gain the low prices. Just because you have to pay for them doesn't mean the government isn't buying them from the drug companies. > >-- Canada's cheaper, but we make all the drugs > > FYI there are plenty of drug companies in Canada, Canadian, International > AND American. Sure-- but what proportion of drugs are made in US versus Canada? And what proportion of the drugs that are considered very valuable, but cheaper in Canada, are produced in the US versus Canada? > > >So, like I said, Canada is " mooching " off of us. If we didn't have a > for-profit system that was conducive to making all the drugs, where would Canada > get their cheap deals from? > > Canada is NOT mooching off YOU. No, not me personally. It's a case of supply and demand and the DRUG COMPANIES negotiate a deal. > You're very welcome to visit Canada and buy American drugs there, or you > can buy them online. I have no desire to purchase any drugs at all. My point is that the low price in Canada for the proliferant drugs is allowed by the high price in America, and the for-profit system. Of course, it kind of misses the point anyway, since Canada's drug industry is also, to my knowledge, for-profit. What I'm saying is, drug companies have an incentive to produce drugs to the extent they can profit off them. I suspect-- don't know for sure, but suspect-- that drug production is considerably higher in the US. Now IF that's true, then the high prices Americans are paying and any other part of the atmosphere conducive to making the profits, are supplying Canada with the ability to get cheaper drugs. When I said " mooching " I meant it not as a moral judgment but more as a metaphore describing the overall dynamic. I personally don't use drugs and don't see much benefit in having the pharmaceutical folks around, but I was responding to Heidi's assertion that Canada's " socialism " is responsible for their better drug prices. What I'm saying is that that " socialism " could not provide those prices if it weren't for the American drug companies making them and the American consumers being charged to make up the price. > >You also don't have choice, and you also don't have a lot of the > technology. > > You can change doctors if you want to. It's not the dark ages and there is > plenty of good technology. Sure, but the technology is better here, which is why a lot of folks from out of the country come here for medical services. Obviously you aren't going to come here if you have a cold, nor, I'm sure, if you break a leg. From folks I've talked to who live in Canada, you don't have the kind of choice in medicine you have in America. You disagree? > >They have power to the extent we can do all their dirty work for them, > like make their drugs > > That's dirty work? It's up to the drug companies whether they want to sell > them to other countries or not I agree. I could care less about the pharmaceutical companies. I'm responding to Heidi's point that Canadians get cheap drugs, and simply pointing out that you can't get cheap drugs if they aren't produced first! > > >devise their medical technology > > Canda has its own too you know! I know that. We have more of it. > >and fight their battles against totalitarian monoliths that want to > conquer the world. > > Good grief, whose battles? I'm not even going to go there but I > think you have overstepped the line with THAT comment. Do you recall the Soviet Union? Cold War? Etc? I'm not a big fan of the American military Empire, but it's illogical for folks to blame the US for such high military spending (most of which is actually repaying the national debt for previous military spending), comparing us to European countries, without recognizing the necessity of keeping the USSR in check. Granted it's all over and we can probably put away some of the toys. But everyone else blames Canada, why can't I! :-) Chris Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 15, 2004 Report Share Posted January 15, 2004 Chris- >Canada couldn't sell >them so cheap if US companies making high profits weren't producing them. >Moreover, US drug companies couldn't afford to sell the drugs so cheap to >Canada >if US consumers weren't paying such high prices. Let me understand this correctly. US companies sell drugs to US citizens at exorbitant prices because they've managed to prevent people from bargaining effectively with them, but they sell to Canada at much lower prices because Canada bargains better. How does this lead to the idea that Canada shouldn't be allowed to sell those drugs to the US at lower prices than those same drug companies sell their drugs to people in the US? - Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 15, 2004 Report Share Posted January 15, 2004 Re: Drug Prices Canada-US > Moreover, US drug companies couldn't afford to sell the drugs so cheap to Canada if US consumers weren't paying such high prices. Not true at all. You need to read financial statements on these drug companies. Canada, as many other countries, do not allow price gouging which is what US drug companies do. In a capitalistic system, a patent is a legalized monopoly which shuts down free enterprise. Drug companies sell to Canada at the reduced prices because the Canadian government does not allow the drug companies to exploit their people just because they are a monopoly. They still make good profits. Obviously, being capitalistic, they wouldn't sell their products if they didn't. US consumers pay high prices because pharmacia in this country is one of the top spenders on lobbyists in Washington who see that their interests are protected at the public's expense. As far as price controls, the US plays similar games on imports from other countries, they are usually tariffs to raise prices of foreign goods giving advantage to domestic corporations. Another example is states regulating energy fuels. There are a lot of states who pay less for heating fuels produced in Texas, than Texans pay. > >What it was supposed to mean is that if the for-profit system the United > States has is responsible for the creation of the drugs, Actually, it is very misleading to state the " for-profit " system creates drugs. That implies research is done with private funding. Actually, the technology and most drugs are created in academic universities, paid for by public tax money. Drug companies do the developing - a fraction of what the research costs. > Yes, but Heidi's reference to drug companies witholding life-saving drugs was referring to South Africa's insistence they be able to bootleg the AIDS drugs-- I don't know what else she could have meant. This is gross distortion of the facts. For the record, it has been the US shoving the drugs on South Africa. South Africa is aware, as Canada and most other countries, that US pharmaceuticals price gouge for drugs that really are not that " life saving " . South Africa did not necessarily care about bootlegging, rather it had to do with the side affects of the drugs (they create many other problems), and their lack of real cure (solution) for the problems, compared to the price of the drugs and the magnitude of the problem in South Africa. They were agreeable to produce them themselves since America wants them to have them so badly, thus saving any expense to America. That would shift the supply/demand curve to where there was a crossing point - as in a capitalistic system. All that would be lost would the outrageous profits the drug companies would make by manufacturing themselves. As if their profits are not incredible anyway. SA is a market they have not been selling in anyway - there would be no cost to the drug companies.. In a capitalistic system, demand is a function of price. Thus realising the drugs were not worth their controlled price, lead to the position that South Africa would do without them and put their money elsewhere to deal with their problem. So the result - " noble " US is going to give them 10 billion in " aid " and is pressing other countries to give their share. Which in other words means, the American taxpayer and whoever else buys into this mission of President Bush, will pay the drug companies exhorbitant prices to give their drugs to South Africa. South Africa will not get 10 billion+ dollars, they will get drugs probably not even worth 1 billion, that will have modest affect on their problem. The drug companies will laugh all the way to the bank and the American taxpayer will think South Africa should be internally grateful. It's called scam. >You must be buying them from the government then, no? Not government buyers in Canada - just government representing the best interests of their people and not allowing American corporations to extort high prices. Those prices are so much lower than what Americans pay that Canadian pharmacies have been selling those drugs on line back to Americans at cheaper prices than they can buy them here, and making a profit doing it. The drugs companies are very mad about that and have threatened to not sell to Canada if that is not stopped. It's called " free enterprise " system. > >So, like I said, Canada is " mooching " off of us. The only ones mooching off of anyone and everyone are the drug companies. As I said, most drugs are created with money from the American taxpayer. Take a look, most of their employees are in their marketing departments. Americans pay exhorbitant prices because they have failed to demand their representatives in government to do something about the situation. Precedence was established long ago in various other industries of the need at times, for government regulation of industries. It is that ignored need that is causing high prices in America. > It's a case of supply and demand and the DRUG COMPANIES negotiate a deal. Supply is controlled by patents - legalized monopolies that do not allow the free enterprise system to work. Demand is health, necessary to life - its not a product like a TV or car. That skews the demand curve as well. Without regulation and control, medicine for profit gets exhorbitant prices and profits by taking gross advantage of others disadvantages in life. It is actually deplorable. > My point is that the low price in Canada for the proliferant drugs is allowed by the high price in America, and the for-profit system. Again, the high price in America has nothing to do with the lower prices in Canada. That is BS public relations put out by drug companies. That is all it is. Again, drug companies only sell when they can make a profit and they get the highest prices they possibly can. Canada is regulating just as the US should be doing. It is capitalism at work - not socialism. > What I'm saying is, drug companies have an incentive to produce drugs to the extent they can profit off them. I suspect-- don't know for sure, but suspect-- that drug production is considerably higher in the US. Now IF that's true, then the high prices Americans are paying and any other part of the atmosphere conducive to making the profits, are supplying Canada with the ability to get cheaper drugs. Again, they do not sell unless there is a profit to be had. Canada gets drugs, drug companies get their money - it is a mutually beneficial deal. No favors done at all by the US. And actually, argument could be made as to the morality of the whole situation, or lack of. > it's illogical for folks to blame the US for such high military spending .{for}..... keeping the USSR in check. I thought the high military spending that went on in the 80's was not to keep the USSR in check. Rather, Reagan intended to bankrupt them as they tried to keep up with us so to keep us in check. And it worked. > But everyone else blames Canada, why can't I! Everyone else does not blame Canada. There are a number of us who realise there's a lot more to the story. :-) Chris Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 [snip] Actually, it is very misleading to state the " for-profit " system creates drugs. That implies research is done with private funding. Actually, the technology and most drugs are created in academic universities, paid for by public tax money. Drug companies do the developing - a fraction of what the research costs. _** The for profit system does create drugs. That is the only reason the drug companies make drugs - for huge profit! ** Excellent case in point is the cholesterol lowering drugs. Before all the hype started about high cholesterol a normal reading was about 300. Then they did their fear mongering and screamed from the rooftops that high cholesterol caused heart attacks. " Take these drugs! " they screamed. Avoid a heart attack! " And people did. Seeing how successful their " wonder " drug was the drug companies got the Establishment to lower the numbers. Billions of dollars in profit per year. " It's working! " they screamed. " Lower is better. " And they lowered the numbers. More billions of dollars in profit as lower numbers meant that more people had to take their dastardly poisons for the rest of their lives. ** Never mind that the drugs cause all manner of other problems, suicide, stroke, death from violence (includes accidents) and a general, overall feeling of malaise. But the statins DID prevent heart attacks. Again, no matter that in almost every test there was as much or more overall mortality than in the control groups. ** And we still hear it every day. " Take your cholesterol meds! Don't eat any eggs, butter or red meat. " Now they want to give cholesterol lowering drugs to children. ** Profit gouging at its worst! ** But good news is at hand. More and more eateries are advertising " low-carb " meals. Fast foods joints, (at least in our area) yes. But it is a start. The down side is that we will end up with as much low-carb junk food as we now have low-fat junk food. I expect that it won't be long and the Establishment, seeing they cannot beat them will join them. Then they will try to pretend that the murderous lipid hypothesis never existed. In the 1970s the heart attack rate really went down. The Establishment will not acknowledge that have any inkling of why. My theory is that it was early 1970s when Atkins wrote his first book. And it was the 1970s when Linus ing with his comments on Vitamin C and the Schute Brothers of Canada and their comments on Vitamin E. People were eating low carb and maxing out on Cs and Es. The hearts of the people said, " Hey! We love this! It's working! " It worked so well that we periodically see articles in the mainstream press about how dangerous it is to take more than the RDA of Cs and Es. The drug companies fighting back. Then about 1981 the low-fat garbage hit the fan and out-shouted the good stuff and the heart attack rate went right back up and beyond what it had been. And it's still climbing, along with diabetes, cancer and a host of other maladies caused by the malnutrition of the low-fat mantra. Enough of my ranting. Judith Alta Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 When I said " top " scientists I should have put it in quotes. I meant scientists who are much published and well known. A truly top scientist would not sell himself out. The drug companies spend more on advertising and promoting their drugs than they do on research and development. That gives one a hint as to the enormity of the profits they rake in. Thanks for your excellent commentary. Judith Alta -----Original Message----- Judith, I know all this about scientists selling out. When I have more time, it is interesting to explore and understand better as to who becomes a " top " scientist and who doesn't. Yes there are big dollars involved in development and testing, but there are incredibly bigger dollars in their bank accounts coming from the returns those dollars spent get. You have to look at rates of return to appreciate, especially compared to what other industries get. I'll pull some of what I'm talking about later today. Don't have time right now. Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 how about you actually say what you mean an mean what you say in a consistent manner? after all, you yourself said <<I'll choose my words less carelessly next time.>> [interesting double negative] .... one benefit would be that posts would become mercifully shorter..:-) TIA Dedy <<I chose my wording because I wanted to see what my foot tastes like. What I should have pointed out, rather, in order not to give the impression I was a foolish anti-Canadian chauvanist, which I'm not... <snip> ....When I used the word " mooching " I didn't mean that Canadians themselves are mooches, I meant it as an impersonal reference to the dynamic that were it not for the shoddy buying power of Americans, Canadians couldn't get such low prices...>> Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 >Their HMO or >insurance company gives them a very small list of " approved " doctors in the >patient's area. If the patient wants a doctor that's not " approved " they are >out of luck. IF you can get insurance. On the celiac list someone posted the response from the insurance company when he tried to get insurance: They are also saying that their decision to decline the enrollment is based on my medical history and specifically they included in the letter the following: Gluten Free diet Must be signs, symptoms, and treatment free for 5 years to review. NO Complications. OK -- so this if for basic *gluten intolerance*. You can imagine if the poor guy got diagnosed with cancer. (BTW, based on what I'm hearing about this, it is best NOT to get diagnosed by a doctor in this country. Undiagnosed gluten intolerance has a high death rate, and the insurance companies believe that no one really sticks to the diet, it seems). -- Heidi Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 Judith, This problem is so mamouth. Drug companies are the main advertisers in many journals - that's subjective right there. The scientist may be getting funding from NIH but is looking for a better paying job (they don't make that much) so he publishes baised studies. This happens at the FDA with guys who are approving drugs - they don't want to piss off a potential employer. A bad reputation can send them to unemployment lines forever. Scientists can be suppressed from publishing or influenced in what he publishes by superiors at his university who have control over his job. He can easily be black balled. Grant funding is usually conditional on employment. Funding to work that threatens power structures doesn't come. When you are reading about it, rest assured it is because it is so bad. I have a friend that is a scientist. He says he's better than a layman at filtering through the bogus work but he still gets tricked in published work he thinks is valid. He will try repeating it, only to find he has wasted major time and money because it was bogus work. I remember back on HIV shortly after Clinton took office. His newly appointed head of NIH went on Nightline TV to tell the public that scientists who were protesting HIV being written as law as the cause of AIDS were totally wrong, they were renegades, disgruntles who were destroying the public's faith in their great medical system. He pointed out specific names and where they worked. All these scientists wanted was more research funding to explore in more depth the cause of AIDS as there were too many unprovens with HIV and indications of something else going on. RE: Drug Prices Canada-US Here two links to what I was saying about drug companies and universities. http://bmj.bmjjournals.com/cgi/content/full/326/7388/526 http://jama.ama-assn.org/cgi/content/short/289/4/454 Judith Alta -----Original Message----- , I do not disagree with you except in one area. The drug companies do pour tremendous sums of money into development and testing of drugs at universities. They do it because people believe that studies from universities are accurate and reliable. The drug companies also pay large sums to top scientists to sign articles that paint glowing pictures of drugs. And the scientist may never have seen the article or the studies it refers to. I'll see if I can find some links. Judith Alta -----Original Message----- Judith, I'm not conflicting with what you are saying. Rather, I am saying that the development of drugs is actually more outside the capitalistic system and most is not done by the drug companies, nor financed by them. It is rather the federal government that pays for it through grants, and charitable organizations, and endowments. In theory, federal money is public tax dollars - this is course is a bit more complicated. This investment by the government into research is a modification to the capitalistic system, not pure capitalism wherein the government would be uninvolved in free markets, and research and development of new products. The drug industry is not the only industry wherein this occurs but it is one of the biggest reapers. To say drug company's pay for the research and technological discoveries, and pay for development is a gross distortion of the reality of how our system works. This delusion is commonly used to justify the high prices they charge and the exhorbitant profits they make. Reality could actually be argued that since the public pays for the research, they have more right to more reasonable prices being charged. In our system, academic universities are the training grounds for the labor market. They were not intended to be profit businesses themselves but rather support to our economic system and corporations. They actually could not capitalize on the drugs and discoveries they made until 1982 when the federal government passed laws allowing them too. Thus joint ventures developed between universities and drug companies. Most all the academic institutions receive tremendous funding from federal and state government just for operation. Professors - our intellectuals, top scientists, ideally in our system, had what was known as academic freedom in the universities. This is why the tenure system evolved which was to protect them from capitalistic interests. With the cholesterol drugs, this funding to unviersities and the drugs company's close involvement with politicians in Washington was a significant factor in the lipid hypothesis being written as law. Academic freedom to stop or challenge this was shut down by the control of federal funding to any scientists who protested it. This is contrary to free markets, it is contrary to freedom of speech and democracy. It is contrary to the checks and balances that theoritically, our system works on. Not all of the anti supplement stuff comes from drug companies. Not all that says they are great for us comes from independent scientists. Supplement manufacturers do the same thing that drug companies do - strive to make profits and in that process, distort info to promote their products. Of course they are not as big and powerful as the drug companies but they still, are capitalists. You have to weed through a tremendous amount of very subjective information on all pills and health issues to try and find those scientists out there that are trying to express intellectual freedom for its sake and not the sake of profit. Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 , I am aware of all that you have said. But you put it in a different perspective than I have seen before. How do the renegades such as Atkins and Ravnskov make a go of it? I'm sure the drug companies would love to put them out of reach of the common person. Atkins, of course, is gone now. But his legacy lives on. Now that it has a toe hold it will extremely difficult if not impossible to stop. People are sick and tired of being sick and tired. Thank you, Judith Alta -----Original Message----- Judith, This problem is so mamouth. Drug companies are the main advertisers in many journals - that's subjective right there. The scientist may be getting funding from NIH but is looking for a better paying job (they don't make that much) so he publishes baised studies. This happens at the FDA with guys who are approving drugs - they don't want to piss off a potential employer. A bad reputation can send them to unemployment lines forever. Scientists can be suppressed from publishing or influenced in what he publishes by superiors at his university who have control over his job. He can easily be black balled. Grant funding is usually conditional on employment. Funding to work that threatens power structures doesn't come. When you are reading about it, rest assured it is because it is so bad. I have a friend that is a scientist. He says he's better than a layman at filtering through the bogus work but he still gets tricked in published work he thinks is valid. He will try repeating it, only to find he has wasted major time and money because it was bogus work. I remember back on HIV shortly after Clinton took office. His newly appointed head of NIH went on Nightline TV to tell the public that scientists who were protesting HIV being written as law as the cause of AIDS were totally wrong, they were renegades, disgruntles who were destroying the public's faith in their great medical system. He pointed out specific names and where they worked. All these scientists wanted was more research funding to explore in more depth the cause of AIDS as there were too many unprovens with HIV and indications of something else going on. Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 >How do the renegades such as Atkins and Ravnskov make a go of it? I'm sure >the drug companies would love to put them out of reach of the common person. Judith: Part of what we are talking about here is what normally happens during a paradigm shift, no matter who the players are. It happens over and over through history, and people have written books about it. It used to happen very slowly -- the Neanderthals, for instance, might have lost ground because they never could get the hang of needles to sew clothes in a cold climate (one theory, anyway). In the earlier history of Europe, there was case after case of some person coming up with some new invention or theory and getting denounced by the powers that be (king, church) or the populace, as a witch or whatever, and often outright killed. It could take hundreds of years between the time one person thought of the idea, and people accepted it. Today the time cycle is a lot quicker -- I think about 20 years in Atkin's case. But the emotions and mechanisms aren't really different. It would happen with or without conspiracies and people defending their economic turf. By and large things are a lot freer now than they were 200 years ago, which is freer than 500 years ago. And a lot of tribal cultures REALLY didn't change much, even the art forms were ingrained in tradition, and things like clothes patterns were often dictated by tribal affiliation. Folk like Atkins have always been out there ... I think a lot of them really enjoy the battle, at some level. But most humans really follow tradition, seems to be built into us, and anyone who " rocks the boat " has to run the guantlet (to mix metaphors badly). (I'm not saying the companies don't do propaganda ... but a lot of it is just from regular people who really don't like a new paradigm and think it is idiotic at best or evil or unhealthy at worst). -- Heidi Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 Chris > I'm not sure what you mean. Supply and demand meet at an equilibrium > dependent on the number of suppliers and amount supplied and the quantitative demand for a product. I'm not sure what that has to do with products, except in the sense that a higher profit margin would induce greater supply-- but that would have the effect of lowering the price. ***Bear in mind it's a theoritical model. Entry into and out of the market by suppliers is not a quick event just because profits are high. It takes time for a new organization to enter. And that organization has to decide if those profits will be there by the time it gets there, he weighs other opportunities, cash requirements, his technical resources, etc. There are a lot of factors that are considered. If patents exist, entry is not possible anyway. If profits are low in the industry they are in, most cannot simply walk away from a major manufacturing facility or easily convert it to a new industry. They may function for a year or longer at a loss if future projections reflect profitability. Theoritically, supply and demand curves cross at the point a product would be sold at. But remember the supply curve is derived as a function of gross profit margin. They have to sell at a price sufficient to cover the direct costs of producing the good. What is left - gross profit - then contributes to reducing the overhead expenses which are fixed (don't change regardless of sales). If they cannot cover the direct costs, then they would not sell at all (in theory) as each sale would increase their loss. If that were the case with Canada, then you would e correct that the US is helping them out by paying higher prices but it is not the case. And as I said, the companies are not forced to sell and wouldn't sell at a price below that margin line. ***In reality, suppliers sell at various prices - in all situations seeking to maximize revenue. Stores start off with merchandise priced at top dollar. They sell so much, then they have a sale at say 25% off. They sell so much at that level and then reduce the price again. The last few remaining items may be sold for less than they paid for them. Wholesalers give discounts to buyers - they negotiate to get their business. One may get a better price than another. Volume buying can cause the wholesaler to give a better deal. But they are always seeking to maximize sales and sales dollars in all situations. Take a car salesman - he will push to get the highest price he can but has a bottom line price he will sale at. If the bottom line price is the best he can get, he'll take it rather than lose the sale. Just because your neighbor drives a harder bargin and gets a great deal on his new car, does not mean that you will have to pay more for your car. Nor does it mean that if you pay too high a price for your car, that the salesman will cut your neighbor some slack and give him an even better deal. Rather, he seeks to maximum his sales price in all situations, taking the most he can get but less if that is all he can get. As long as the sales price results in a gross profit margin, he'll continue selling up to a point. > I agree. However, if the profit margins fall, that will make other industries more appealing to invest in, so you might witness a massive withdrawal of capital from drug companies. I wouldn't have much sympathy for them myself, since I don't really value their presence a whole lot, but it would undermine the point of lowering the prices, since it would decrease the rate of production of future drugs. ***There is a lot of theory to economics, and more levels to it of course. One factor that always interested me that is not well addressed and I think was well revealed in all the corruption fall out of the 90's, is that management of corporations actually seek self preservation above all. Good profits is a means to that end. While it may be in the company's interest to shut down, it is not in theirs as they lose a job that is not easily replaced. So they do everything possible to promote survival. As I said, when profits start dropping, efficiencies become of issue. Drug companies have a lot of clean up they could do. Is there really value in paying ghost writers to publish in journals? How much would they save and how much would they gain in the long run? Do they really need to spend so much on lobbyists? What about those commercials on TV telling us to ask our doctor? There is a growing distrust of their medications - is they spending helping or hurting them? > That's true, but since their stocks are sold publicly and subject to speculation, you don't have a constant amount of invested capital. ***This is not exactly how the stock market works or capital funding. The company sells stock and gets capital. That stock is then traded in the market by its new owners. Changes in its value don't affect the capital the company got to work with. Only if the company sells more stock shares held in its treasury will it gain capital. Back when the market was very low, corporations bought back a lot of their issued shares. But when this is done, the supply of shares on the market increases or decreases which revalues all shares back to the same net capital worth. Stock splits do this. > If you just established a system that respected markets, you wouldn't have that problem either. ***Our system does respect markets. But our system also has through history learned that at times, intervention is necessary to markets that have lost it for various reasons and become too imbalanced. Our most recent has been the stock market. A system that worked pretty well since the Great Depression got carried away in the 90's with greed and pushed limits, broke laws, etc. That led to government intervention and new rules being set (and a few prison terms to set examples) to bring back market dynamics. We are due for a major shake up in medicine. And I think its coming. [] Quote Link to comment Share on other sites More sharing options...
Guest guest Posted January 16, 2004 Report Share Posted January 16, 2004 In a message dated 1/16/04 9:56:34 PM Eastern Standard Time, mhysmith@... writes: > ***This is not exactly how the stock market works or capital funding. The > company sells stock and gets capital. That stock is then traded in the > market by its new owners. Thanks for pointing that out; I was thinking too fast. > >If you just established a system that respected markets, you wouldn't > have > that problem either. > > ***Our system does respect markets. But our system also has through > history learned that at times, intervention is necessary to markets that > have lost it for various reasons and become too imbalanced. Our most recent > has been the stock market. A system that worked pretty well since the Great > Depression got carried away in the 90's with greed and pushed limits, broke > laws, etc. That led to government intervention and new rules being set (and > a few prison terms to set examples) to bring back market dynamics. We are > due for a major shake up in medicine. And I think its coming. Well the Great Depression is a great example of how gov't intervention hurts a lot more than it helps. Chris Quote Link to comment Share on other sites More sharing options...
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