Regulators and insurance companies could instantly get medical drug and device prices in the USA to meet or beat any prices in the developed world.  All it takes is the same kind of free trade policies that get us open, fair prices for DD-RAM, flash storage, FPGAs, microprocessors, GPUs, and other electronic components.  It’s kind of funny given that our soon to be new president is talking up tariffs and protectionist policies.

To Illustrate the point I just purchased medicine from overseas, for the first time ever. I needed two drugs to do a treatment for pre-cancerous crud growing on my scalp.  The total cost getting one drug from Canada and one from the UK was less than half of quotes from US pharmacies.

One of Trump’s claims that rings true to me is that our leaders sell out Americans and make us patsys for the rest of the world.   High drug and device prices here in the US exist for one reason only – it creates lots of opportunities for graft by senior civil servants in the FDA and US patent office, members of Congress (who are exempt from insider trading), and judges.

All the claims about the need for a central authorities to negotiate prices with drug companies is cover for middle men in government and admin looking to take a cut. When pricing is open and transparent, as with electronic components and also, for example, airline fares, middleman and brokers add  little or no value and should add little or no cost.  Electronics companies have figured out the value of distributors (like Allied, or Newark).  Medical drugs and devices, like electronics, have a very high value to weight and volume. Many are likely best distributed in a similar fashion.   Some, like drugs that need to be injected or devices that are surgically implanted, might work better through the value added partner chains. But drug and device companies would be wise to look for more direct, one-price business models for customers globally.  It is almost certain to be in the best interest of their shareholders, their customers / patients, and their employees.

 

 

 

 

 

 

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