Bernie Sanders proposes solution to high price of medicine

Senator Bernie Sanders proposes a major reform of the way we pay for prescription drugs and fund research. He's patently right, drugs
are cheap. There are few drugs that would sell for more than $5-$10 a prescription in a free market. However, many drugs in the United States sell for hundreds of dollars per prescription and, sometimes, several thousand dollars per prescription. There is a simple reason for this fact: government-granted patent monopolies.

The government gives patent monopolies to provide an incentive for drug companies to carry through research. This is an incredibly backward and inefficient way to pay for research. It leaves us paying huge amounts of money for cheap drugs. It also often leads to bad medicine. We can do better – and Senator Bernie Sanders has proposed a way. He has introduced a bill to create a prize fund that would buy up patents, so that drugs could then be sold at a free market price. Sanders's bill would appropriate 0.55% of GDP (about $80bn a year, with the economy's current size) for buying up patents, which would then be placed in the public domain so that any manufacturer could use them at no cost.

This money would come from a tax on public and private insurers. The savings from lower-cost drugs would immediately repay more than 100% of the tax. The country is projected to spend almost $300bn a year on prescription drugs this year. Prices would fall to roughly one-tenth this amount in the absence of patent monopolies, leading to savings of more than $250bn. The savings on lower drug prices should easily exceed the size of the tax, leaving a substantial net reduction in costs to the government and private insurers.

The Sanders prize fund bill would go far towards eliminating the problems that pervade the drug industry. First, it would end the nonsense around getting insurers or the government to pay for drugs. If drugs cost $5-$10 per prescription, there would be no big issues about who pays for drugs. This would eliminate the need for the paperwork and the bureaucracy that the insurance industry has created to contain its drug payments.

continue reading: http://www.guardian.co.uk/commentisfree/cifamerica/2011/may/31/healthcare-pharmaceuticals-industry?CMP=twt_fd

the best senator we've got.

it won't happen. That's my daily 2-minute hate. Sorry.

The projected income stream from the patent should be the answer. In that regard you may get efficiencies in reducing fraud and making it easier to access beneficial drugs. I wonder how we can avoid the abuse of the government buying a pig in the poke?

We you say the "free market" would define prices at $5-$10, I have to question where that number comes from. I assume it is the variable cost of manufacturing the drug plus some profit (and possibly the non-intellectual fixed cost amortized in).

I like the idea of working the patent angle, but Senator Sanders is on the right track for one potential cost containment. I don't think that the high end chemo drugs can be sourced at $5-$10 even without intellectual property, and how much of the current cost of that drug is actually reflected in the extensive interaction necessary to administer them.

I also want to see the issue of the free riders from other countries stepping up and paying for the development cost as well. Only in the U.S. do we pay what the drug companies ask (it is actually in the law that we cannot use U.S. government buying power to get a better deal). Other countries pay much less and sometimes threaten to breach our drug companys' patents if they don't get their price. We should never pay more than the Canadians, Brits, or Germans pay for drugs that have been developed in the U.S.

Lots of small companies are working on cutting edge drugs. They run through many trials and employ lots of skilled people with the hope of a payoff in the future. My brother in law works for one. My other brother in law works for a larger company also doing drug development. Lots of drug companies have gone belly up, and many of them have gotten out of the research and development game.

My first thought.......

that he had 'safety concerns'. :rofl:

since there has been no move to change that policy regarding private purchase and re-importation of drugs from Canada.

The drugs came from here in the first place. Unless we're willing to accuse Canadians of tampering, what on earth could pose a "safety issue"?

of profit safety issue.

so our bodies might not react right to their drugs measured in the godless metric system.

And it's so damn cold in Canada, maybe the drugs are frozen and you'll shit'em out before they can thaw out and git to work.''

From the White House webpage, Jan. 2005.

Let the drug companies know that the government or insurance companies in the U.S. plan to negotiate prices of drugs in the same way Canada does (note this currently violates Federal law). Also let them know we do not intend to pay more for drugs than Canada (or Britain or Germany) does.

The Canadians in the past have threatened to breach patents if they did not get the price they thought was fair. The inefficiences of sending drugs to Canada and reimporting them through a pharmacist is simply mind boggling. Since it is gray market at best, we should be concerned about adulteration.

I think our drug price negotiators (Medicare, Medicaid, Federal and State Health Insurance plans, and private insurers if they wish to participate) should take the Canadian price list into negotiations with them and refuse to pay anymore than what is on the list.

As did Senators from states that have drug makers. http://articles.latimes.com/2009/dec/15/nation/la-naw-senate-drugs-2009dec16