It is true that European countries free-ride off the high cost we pay for drugs, because it’s the U.S. market that drives innovation. But that doesn’t mean we’d be better off paying their prices, if that meant new drug development slowed. We don’t just want everyone to have health insurance in the future. We want them to be healthier, freed from diseases and pain that even the best health insurance today cannot cure or ease.
To this, progressives will note that pharmaceutical companies pump money into me-too drugs, spend gobsmacking amounts on advertising and administration, and make billions and billions in profits. And they’re right. It’s ludicrous to say that the pharmaceutical system we have now is oriented toward innovation. It’s oriented toward profit; sometimes that intersects with innovation and sometimes it doesn’t.
The solution for high prices is high prices. Because that encourages other producers to enter the market, increase supply and thereby lower prices.
Drug development is difficult, no one ever knows whether something is going to work. When something does what would we like? Other producers to enter that same market, increase supply and thereby lower prices.
Pharma companies pumping money into me-too drugs is the damn point.
Ezra Klein is an idiot, QED.