<font size="2" face="Verdana, Helvetica, sans-serif">I cannot justify that. But I believe there is much less of that going on than there used to be, and much of what had been going on was the vicious circle of the competition is doing it, we had better at least match it. So you go from giving them a pen that has the drug name written on it so they have it in front of them when writing prescriptions, and educational materials like wall charts etc. to bigger and bigger gifts until someone says "enough".How do you respond to the criticism that drug companies spend more money on marketing than they do on research and development?
<font size="2" face="Verdana, Helvetica, sans-serif">I don't know the numbers. I am sure it adds to the cost, (and everyone knows what venues return the biggest court awards), and all the clinical trial results are scrutinized very closely by both the government and the companies involved. Nobody wants people to die, and there are different levels of "allowable" side effects related to what is being treated - you can allow more serious side effects for something treating a life-threatening disease such as cancer than you would allow for something treating a headache. But at any rate, the companies (like Merck) will pull drugs as soon as the cumulative evidence shows this sort of correlation. The numbers of people taking Vioxx for several years could not possibly have been matched by clinical trials, and if this did not show up in clinical trials, that should mitigate Merck's exposure (but, of course, it might not).And how much does litigation play into the cost of drugs in the United States?
<font size="2" face="Verdana, Helvetica, sans-serif">You are preaching to the choir here. The alternative is to not sell to these other countries at their governments' fixed prices. Usually those prices ARE above manufacturing costs even though they will not help much to recoup the R&D investment, so Pharma might as well play by their rules. But many companies have begun to restrict the sales of drugs to countries such as Canada to levels that are thought to be the usage in that country. If they export some obtained at their price structure, there will not be enough for Canadians. We are already seeing 3rd world and counterfeit medicine showing up in Canada, not much but it looks like a trend.I have also argued that we here in the United States "compensate" socialized medicine around the world. Because governments control prices in places like Canada and France, and a host of other countries, the citizens of this country are left to pick up the tab while they get the benefit of lower prices (albeit with fewer available drugs).
There are huge fixed costs associated with drug development. We in the US are left to cover those costs. The rest of the world's revenues are gravy.
So, if we only sold to the US only the US would bear the cost of development and the less scrupulous nations would read the patents and make the stuff anyway. This way Pharma gets just a little profit outside the US, and the drugs they get are almost certainly safer.
Tariffs and constraits on free trade suck.
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