U.S. Republican Primary

[Ghostbear]

I really hate when people take something from one group of people (those that can afford to pay $900 for a gadget) and apply it to another group (those that need medicine and might not be able to afford it) and say "See, they don't need help".

On the bright side, he has practically no chance of ever being president.

[CorruptUser]

On the downside, Santorum is taking voters away from Gingrich, and, huh, not so bad. Of the 3 (not counting Paul), Romney is probably the least disgusting. Going to be a long election year...

[omgryebread]

Submitted on Santorum's website.

I'm 21 years old, and have schizoaffective disorder. I'm working part time while going to college, so I only have health insurance through my dad's job thanks to the Affordable Care Act. Basically, on my part time job, I can't afford an iPad, and if I didn't have insurance, I couldn't afford the medicine that makes me capable of functioning like a normal person.

So if Mr. Santorum becomes president and repeals the ACA, can he show off that compassionate conservatism and buy my medicine for me? An iPad would be nice too, but I'm not really that greedy.

Love, Rachel

I almost put "in the unlikely event Mr. Santorum becomes president" but that didn't seem classy.

[Tirian]

On the downside, Santorum is taking voters away from Gingrich, and, huh, not so bad.

If Gingrich can't close the deal with conservative voters, that's not Santorum's fault.

[Lucrece]

Gingrich can't close the deal because conservative voters care more about putting a Republican, Anti-Obama/Libruhl candidate over squabbling about purity. And the fact is, thanks to both the media and last election the narrative has been "Romney's closer to center and more electable while still remaining Republican."

Remember, each party's motto is "Anyone but our opponents' guy."

[Dauric]

Submitted on Santorum's website.

I'm 21 years old, and have schizoaffective disorder. I'm working part time while going to college, so I only have health insurance through my dad's job thanks to the Affordable Care Act. Basically, on my part time job, I can't afford an iPad, and if I didn't have insurance, I couldn't afford the medicine that makes me capable of functioning like a normal person.

So if Mr. Santorum becomes president and repeals the ACA, can he show off that compassionate conservatism and buy my medicine for me? An iPad would be nice too, but I'm not really that greedy.

Love, Rachel

I almost put "in the unlikely event Mr. Santorum becomes president" but that didn't seem classy.

The other point to make is that you need an iPad's worth of medication.. I'm guessing monthly? I've heard of medication programs that would be an iPad a week or so. I'm a tech geek on a reasonable salary and I can afford a decent tablet machine if I budget for it, but there's no way I could buy one every month or every week to function/survive.

[Vaniver]

Rick Santorum thinks that it's totally OK for drug prices to be hugely high because, people pay 900 bucks for an iPad!

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

[Ghostbear]

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

What? I think you're giving an overly generous interpretation of his remarks:

“People have no problem paying $900 for an iPad,” Santorum said, “but paying $900 for a drug they have a problem with — it keeps you alive. Why? Because you’ve been conditioned to think health care is something you can get without having to pay for it.”

Of course, he also said the investing stuff, but that just means he had two points: (1) Shut up about drug prices because of iPads (2) Profit incentives are good.

Only the second point of his has any merit, and the first one is really insulting to everyone that needs drugs to survive or function.

[omgryebread]

Rick Santorum thinks that it's totally OK for drug prices to be hugely high because, people pay 900 bucks for an iPad!

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

I totally agree that I should be living on the street so there can be drugs for future people to not be able to afford. A new antipsychotic isn't going to help anyone but very rich schizophrenics if it's as expensive as current ones are.

Besides, the entire argument is a straw man, because controlling the price of drugs is only one way to deal with the problem. The better solution is universal health care. Perhaps you could have some sort of system where insurance companies weren't allowed to not cover patients like me. To make it up to them, you could make insurance mandatory, also preventing people who think they don't need insurance from costing the taxpayer if they get sick or injured. Man, that sounds familiar. I bet Rick Santorum would be a big fan, since he's so concerned about saving people!

[EsotericWombat]

You know, I think you're right!

[Lucrece]

Rick Santorum thinks that it's totally OK for drug prices to be hugely high because, people pay 900 bucks for an iPad!

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

He's strawmanning. He's saying that the default position of a woman is that she wishes the company didn't see profit. The woman is just saying the profits are absurd and need regulation given that these companies don't have much in terms of competition and can afford to set prices at whatever level they want because the alternative for people is not voting with their wallet, but rather their life.

It's not like people will go, "Hmm, those prices are ridiculous, so I'm like gonna let my health deteriorate even to the possibility of death to make a point." More than likely it will be, "This will ruin me, but I like being a conscious being more than suffering great cognitive impairment and the likelihood of ceasing to be conscious permanently."

[CorruptUser]

Rick Santorum thinks that it's totally OK for drug prices to be hugely high because, people pay 900 bucks for an iPad!

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

He's strawmanning. He's saying that the default position of a woman is that she wishes the company didn't see profit. The woman is just saying the profits are absurd and need regulation given that these companies don't have much in terms of competition and can afford to set prices at whatever level they want because the alternative for people is not voting with their wallet, but rather their life.

It's not like people will go, "Hmm, those prices are ridiculous, so I'm like gonna let my health deteriorate even to the possibility of death to make a point." More than likely it will be, "This will ruin me, but I like being a conscious being more than suffering great cognitive impairment and the likelihood of ceasing to be conscious permanently."

You are missing another point. If pharmaceutical companies are making obscene profits, many more companies will pop up to try and get their hands on that valuable drug money. Unless the companies only have obscene profits because of regulatory capture and, e.g., the FDA prevents smaller companies from even attempting to enter the market or prevents foreign drugs from entering the market.

[Ghostbear]

You are missing another point. If pharmaceutical companies are making obscene profits, many more companies will pop up to try and get their hands on that valuable drug money. Unless the companies only have obscene profits because of regulatory capture and, e.g., the FDA prevents smaller companies from even attempting to enter the market or prevents foreign drugs from entering the market.

Or if it's just an insanely difficult market to get into, with billion dollar research costs. Not to mention patent issues (which I could possibly see someone count as regulatory failure, but I think patents are a bit too broad for that). The startup costs for pharmaceutical aren't negligible at all. Many industries face this same issue, either being natural monopolies (telecommunications springs to mind) or just really expensive to get started on. I don't think there's much government can do- even removing all regulations- that would change that.

[buddy431]

How well are drug companies really doing right now? I know a lot of graduate students in organic chemistry, who say that many companies are cutting back significantly on hiring. There are a number of big drugs coming off patent (Lipitor being the most prominent), and there aren't really any new blockbuster drugs coming up quickly.

[CorruptUser]

While there is a very large barrier to entry, keep in mind that a decent-sized chemistry research lab doesn't cost a billion to create (and grad students are virtually free), and it is theoretically possible to start mass-producing generic drugs in a small facility before adding an R&D department. The biggest hurdle is the FDA and other government regulation.

The auto industry has even bigger barriers to entry, yet most car companies started off as hobby-shops in people's garages. A famous case being the Ferrari, which started out as an experiment to try and create an aphrodisiac that could work even for this pile of crap. Even Tesla Motors started as a pet-project, and that's new. I know people that built their own stock cars from, well, parts, but still. It isn't unthinkable that if profits become obscene, non-regulatory barriers to entry would not be insurmountable.

[Dark567]

How well are drug companies really doing right now? I know a lot of graduate students in organic chemistry, who say that many companies are cutting back significantly on hiring. There are a number of big drugs coming off patent (Lipitor being the most prominent), and there aren't really any new blockbuster drugs coming up quickly.

Good, but not great.

Spoiler:

Pfizer:

Code: Select all

                 Q4 (Dec '11)  2011
Net profit margin   8.92%   12.96%
Operating margin   13.69%   18.93%
Revenue    US$ 67.809 billion (2010)
Operating income    US$ 9.422 billion (2010)
Net income    US$ 8.257 billion (2010)
Total assets    US$ 195.014 billion (2010)
Total equity    US$ 88.265 billion (2010)


GSK:

Code: Select all

   Q3 (Sep '11)   2010
Net profit margin   20.31%   6.53%
Operating margin   29.76%   13.32%
EBITD margin   -   19.26%
Return on average assets   13.87%   4.36%
Return on average equity   68.56%   17.30%
Revenue    £28.392 billion (2010)[1]
Operating income    £5.128 billion (2010)
Net income    £1.853 billion (2010)
Total assets    £42.230 billion (2010)
Total equity    £9.745 billion (2010)


Merck:

Code: Select all

Net profit margin   12.55%   13.30%
Operating margin   12.85%   15.26%
Revenue    US$ 45.987 billion (2010)[1]
Operating income    US$ 1.653 billion (2010)[1]
Net income    US$ 861 million (2010)[1]
Total assets    US$ 105.781 billion (2010)[1]
Total equity    US$ 56.805 billion (2010)[1]


[Ghostbear]

While there is a very large barrier to entry, keep in mind that a decent-sized chemistry research lab doesn't cost a billion to create (and grad students are virtually free), and it is theoretically possible to start mass-producing generic drugs in a small facility before adding an R&D department. The biggest hurdle is the FDA and other government regulation.

And the professors for those grad students will get them doing your work for you out... charity? I think you're just handwaving the barriers to entry away as more minimal than they are here. Very large barriers to entry are very large barriers to entry, no matter how much you sugarcoat them. Even if the regulations are the major sticking point (which I find a ridiculous notion), how many of them are going to be needlessly onerous? How many aren't actually there for a good reason? I haven't read them, but I'd be surprised if removing all the "unnecessary" regulations would change the entry obstacles in any significant manner.

Cars don't work as a comparison point because cars can be maintained and tested and used by a small handful of people. I don't think you can do that drugs. Not to mention, how cars work is a pretty well known quantity- if you make a sports car or a truck or a sedan, they all follow the same principles, and you're just prioritizing different features. If you're designing a cure for AIDS or a vaccine for a new strain of the flu, I'm going to go out on a limb and say you can't re-use much work between them.

[Lucrece]

Rick Santorum thinks that it's totally OK for drug prices to be hugely high because, people pay 900 bucks for an iPad!

That wasn't his reason; his reason was that the primary reason people invest in drug companies (and thus in developing new drugs) is because those drugs are eventually sold and turn a profit. If you get rid of the profit, you get rid of the investment, and more people die in the long run. (R&D spending by pharmaceutical companies is over twice the size of NIH.) Santorum's argument is correct, and I agree with him that future people should be considered about as strongly as current people.

Comparing it to an iPad seems like a mistake, just because it gives people something to focus on besides the fundamental issue without elucidating that issue.

He's strawmanning. He's saying that the default position of a woman is that she wishes the company didn't see profit. The woman is just saying the profits are absurd and need regulation given that these companies don't have much in terms of competition and can afford to set prices at whatever level they want because the alternative for people is not voting with their wallet, but rather their life.

It's not like people will go, "Hmm, those prices are ridiculous, so I'm like gonna let my health deteriorate even to the possibility of death to make a point." More than likely it will be, "This will ruin me, but I like being a conscious being more than suffering great cognitive impairment and the likelihood of ceasing to be conscious permanently."

You are missing another point. If pharmaceutical companies are making obscene profits, many more companies will pop up to try and get their hands on that valuable drug money. Unless the companies only have obscene profits because of regulatory capture and, e.g., the FDA prevents smaller companies from even attempting to enter the market or prevents foreign drugs from entering the market.

Or, sort of like Walmart, or Comcast, the idea that small businesses stand a chance are heavily outdated in some aspects.

[Vaniver]

What? I think you're giving an overly generous interpretation of his remarks:

I'm... reading his entire statement before reacting? That's generous?

Only the second point of his has any merit, and the first one is really insulting to everyone that needs drugs to survive or function.

Santorum's first one is "if you can't afford it, you don't deserve it," and he's applying that both to iPads and life-saving drugs. Whether or not it's insulting doesn't impact whether or not it's true. There are treatments whose benefits aren't worth the costs, and it seems appropriate for that threshold to vary between people.

He's strawmanning. He's saying that the default position of a woman is that she wishes the company didn't see profit. The woman is just saying the profits are absurd and need regulation given that these companies don't have much in terms of competition and can afford to set prices at whatever level they want because the alternative for people is not voting with their wallet, but rather their life.

I'm not seeing why you're calling that a strawman- Santorum's argument is exactly the same when talking about reducing profits and eliminating profits. Less profits will mean less investment. It may be that the optimal amount of profit reduction isn't 0%- but it is almost always better to subsidize purchasers than cap prices.

It's not like people will go, "Hmm, those prices are ridiculous, so I'm like gonna let my health deteriorate even to the possibility of death to make a point." More than likely it will be, "This will ruin me, but I like being a conscious being more than suffering great cognitive impairment and the likelihood of ceasing to be conscious permanently."

I know lots of people who prioritize things above their health, and I suspect they are happier having that control over their life.

Even if the regulations are the major sticking point (which I find a ridiculous notion), how many of them are going to be needlessly onerous?

Ridiculous? No. The FDA delays treatments needlessly, causing the premature deaths of thousands of Americans a year. It should be burned to the ground and the earth salted, replaced by a many-tiered system of drug safety, giving patients access to untested drugs (and thus testing them), drugs that have been used for years, and everything in between, with an easy way to tell which is which. (If this is the first time you've heard this argument, you should reconsider the strength of your opinions on drug policy.)

At the very least, we should return to the pre-1962 regulations, which only required testing for safety, rather than testing for safety and efficacy.

Or, sort of like Walmart, or Comcast, the idea that small businesses stand a chance are heavily outdated in some aspects.

With pharmaceuticals, small businesses are a source of many drug ideas. (Typically, a professor / scientist will do research for a few years at a university, then form a company to pursue a drug they think could be useful, then get snapped up by a large company once they've done enough work that their drug is a good risk.) The Walmart and Comcast analogies aren't as strong because Walmart has no use for a small store or small distribution center; Pfizer does have use for a small patent.

However, competing with Pfizer at what they do is made incredibly difficult by the FDA, and so the small fish need to attach themselves to a big fish or they're not going anywhere. Less (or no) FDA regulations might create a more varied drug ecosystem.

[Ghostbear]

I'm... reading his entire statement before reacting? That's generous?

Reading his entire statement and then promptly ignoring the first half of it is being generous, yes.

Santorum's first one is "if you can't afford it, you don't deserve it," and he's applying that both to iPads and life-saving drugs. Whether or not it's insulting doesn't impact whether or not it's true. There are treatments whose benefits aren't worth the costs, and it seems appropriate for that threshold to vary between people.

So some people shouldn't deserve drugs that either life-saving or necessary to be functional drugs because the market has priced them out? Those kinds of drugs aren't ever going to work under the same conditions as the free market, due to the personal need for them and the lack of alternatives (as your alternative is to die). Relying on free market forces here seems a bit silly to me.

Ridiculous? No. The FDA delays treatments needlessly, causing the premature deaths of thousands of Americans a year. It should be burned to the ground and the earth salted, replaced by a many-tiered system of drug safety, giving patients access to untested drugs (and thus testing them), drugs that have been used for years, and everything in between, with an easy way to tell which is which. (If this is the first time you've heard this argument, you should reconsider the strength of your opinions on drug policy.)

At the very least, we should return to the pre-1962 regulations, which only required testing for safety, rather than testing for safety and efficacy.

Considering the price you have to pay for those drugs and the costs borne on societal overall, testing for efficacy seems pretty reasonable to me. Do you have any sources detailing how it is non functional? Just telling me I should reconsider my stance doesn't really do much to make me do so.

That aside, you appear to have missed the point: would the removal of those regulations be sufficient to make the pharmaceutical business not have a significant barrier to entry? I'm very doubtful.

[buddy431]

Considering the price you have to pay for those drugs and the costs borne on societal overall, testing for efficacy seems pretty reasonable to me. Do you have any sources detailing how it is non functional? Just telling me I should reconsider my stance doesn't really do much to make me do so.

That aside, you appear to have missed the point: would the removal of those regulations be sufficient to make the pharmaceutical business not have a significant barrier to entry? I'm very doubtful.

The United States is pretty notorious for having very strict regulatory hurdles to getting drugs approved. It's quite common for drugs to be approved in Europe before the U.S., if they're ever approved in the U.S. Drugs for Psoriasis that doesn't respond to other drugs, drugs to help people recover from anesthesia, and new treatments for diabetes. That being said, this isn't always the case. The U.S. has faster approval for cancer drugs than Europe, probably both because many cancer drugs come from biotechnology, where the U.S. holds an advantage over Europe, as well as the fact that the U.S. has a very strong Cancer advocacy faction. And there are drugs that are approved in Europe and then subsequently withdrawn, due to either higher risks or lower benefits than first believed, such as Acomplia.

I tend to agree with Vaniver that the U.S. drug approval process is overly cautious (as in, we're hurting more people by not letting useful drugs come to market than we're helping people by preventing potentially unsafe drugs come to market), but reasonable people may disagree about the appropriate barrier to approval.

[yurell]

Cost of drugs in the US are also ridiculously high compared to Europe, from what I understand. One that made me particularly rage was this issue. All because the American companies have a monopoly within America, since you're not allowed to buy from overseas.

Edit: Oh shivers, I didn't realise this was the Republican thread, thought it was another. I don't want to derail your thread, so feel free to ignore me.

[CorruptUser]

Cost of drugs in the US are also ridiculously high compared to Europe, from what I understand. One that made me particularly rage was this issue. All because the American companies have a monopoly within America, since you're not allowed to buy from overseas.

Edit: Oh shivers, I didn't realise this was the Republican thread, thought it was another. I don't want to derail your thread, so feel free to ignore me.

No, it's ok, it is very much related to politics. Anyway, it isn't just American companies monopolizing America, European companies do that too *cough*Merck*cough*Bayer*cough*. The whole pharmaceutical industry is kind of proof that regulation, in the US at least, has been hijacked by the industries it was meant to police.

[Vaniver]

Reading his entire statement and then promptly ignoring the first half of it is being generous, yes.

I don't see what I'm ignoring. The iPad example is a bad one, the statement that health care should be paid for by the recipient is one I agree with, and I agree with the economic logic.

So some people shouldn't deserve drugs that either life-saving or necessary to be functional drugs because the market has priced them out?

Yes.

Under any feasible medical system, not every life-extension is worth purchasing. If you don't agree with that premise, we can't have a meaningful discussion about life on Earth.

Considering the price you have to pay for those drugs and the costs borne on societal overall, testing for efficacy seems pretty reasonable to me.

"Reasonable to you?" Are you a doctor? Are you well-read on drug policy and medicine? Can you name the 1962 regulation change that I referred to without looking it up?

That aside, you appear to have missed the point: would the removal of those regulations be sufficient to make the pharmaceutical business not have a significant barrier to entry? I'm very doubtful.

I refer you to the last paragraph of my previous post.

[Malice]

So some people shouldn't deserve drugs that either life-saving or necessary to be functional drugs because the market has priced them out?

Yes.

Under any feasible medical system, not every life-extension is worth purchasing. If you don't agree with that premise, we can't have a meaningful discussion about life on Earth.

Isn't the government value on a human life something like 8 million dollars? That seems far above the kind of treatments we're talking about, which are still too expensive for many who need them. Treatments can (and sometimes are) cheap enough to be viable options in general while expensive enough to be largely unavailable to some segment of the population. Other Western nations with socialized/Universal/free health care manage to increase the availability of life-saving medication without "giving away the store"; why not the US?

(And before you ask, no I'm not a doctor. But I do play one on the internet.)

[Vaniver]

Isn't the government value on a human life something like 8 million dollars? That seems far above the kind of treatments we're talking about, which are still too expensive for many who need them.

That's the value used to determine the cost of a pollutant / risk to human lives; how much you would have to pay a general person to make them worse off. When talking about saving a person that currently exists, you have a lot more information that you ought to use when determining value, and the value proposition is different. But a system that has a way to value QALY improvements and approves or denies treatments based on that would be a solid system.

Treatments can (and sometimes are) cheap enough to be viable options in general while expensive enough to be largely unavailable to some segment of the population. Other Western nations with socialized/Universal/free health care manage to increase the availability of life-saving medication without "giving away the store"; why not the US?

A single-payer system would probably work in the US, and the radical readjustment necessary to get there could permit other technological / policy breakthroughs that matter far more than the institutional incentives. (If you have everyone's medical data in one place, the amount you can learn about human health by using data mining techniques could alter medicine as much as the invention of the randomized experiment.)

Other innovation incentives need to be watched carefully, though. The US, as the largest and most profitable medical market, motivates a lot of drug research and medical tool investment (both here and abroad). A single payer that drives down the cost of medical spending might cause that investment to be reduced significantly. (This might actually be a good thing for health / the economy overall; the current US medical investment climate is far too focused on highest quality at highest cost, rather than increasing the quality/cost ratio. There are too many variables to predict confidently, though.)

[Bubbles McCoy]

Isn't the government value on a human life something like 8 million dollars? That seems far above the kind of treatments we're talking about, which are still too expensive for many who need them. Treatments can (and sometimes are) cheap enough to be viable options in general while expensive enough to be largely unavailable to some segment of the population. Other Western nations with socialized/Universal/free health care manage to increase the availability of life-saving medication without "giving away the store"; why not the US?

If the true cost of treating the patient in question is one million per year, then over a lifetime the user will exceed the $8 million. There's a decent chance this price is just negotiation shenanigans by the drug company, but this is definitely a situation where the value of a statistical life (technical term for the $8M) might come into play.

I'm not entirely sure if VSL is the right approach here though - it's normally applied in the case of something like automobile safety or environmental regulations, which contends with enduring risk across an entire population. A more appropriate measure for health expenditures would be something like quality adjusted life years, which the NHS uses for it's calculations. I believe it thinks extending life by one year is worth about $40,000-50,000 (if you're curious for more details, just do a few google's on NICE, the branch of the NHS which handles this).

[omgryebread]

Under any feasible medical system, not every life-extension is worth purchasing. If you don't agree with that premise, we can't have a meaningful discussion about life on Earth.

This would be a meaningful sentence if you actually ever defined the limit at which "life-extension" is not worth purchasing.

And the point isn't even what is worth purchasing or not, it's ability to purchase.
Is an $80 tooth extraction to prevent death worth it? What about if the family cannot afford it?

I literally cannot make any sort of meaningful judgement about my health care. Without extremely expensive medicine and therapy, I couldn't function at all. I certainly couldn't work or maintain a house or pay bills or anything. And yet, if I had to pay for them myself, I couldn't afford a house or food or anything anyway.

I don't see what I'm ignoring. The iPad example is a bad one, the statement that health care should be paid for by the recipient is one I agree with, and I agree with the economic logic.

That leaves Deamonte Driver dead, and it leaves me one of the schizophrenic homeless people on the street.

A single-payer system would probably work in the US, and the radical readjustment necessary to get there could permit other technological / policy breakthroughs that matter far more than the institutional incentives. (If you have everyone's medical data in one place, the amount you can learn about human health by using data mining techniques could alter medicine as much as the invention of the randomized experiment.)

Other innovation incentives need to be watched carefully, though. The US, as the largest and most profitable medical market, motivates a lot of drug research and medical tool investment (both here and abroad). A single payer that drives down the cost of medical spending might cause that investment to be reduced significantly. (This might actually be a good thing for health / the economy overall; the current US medical investment climate is far too focused on highest quality at highest cost, rather than increasing the quality/cost ratio. There are too many variables to predict confidently, though.)

I don't think anyone is asking for anything more incentive-eliminating than the single payer system. It wouldn't even harm incentives that much.

Single payer drives down the cost of health care in many ways. One is the elimination of insurance. Right now the money going into "health care" is greater than the amount going to health care providers, the difference being equal to the operating costs and profit margins of the insurance companies. Without those, you've already lowered the amount of money spent on health care (you would spend some on the bureaucracy needed to maintain the system, but it would be less than what the insurance cost.) You'd also standardize costs. Because of the system's huge bargaining power, they'd be able to negotiate prices of care lower. Yeah, the higher-earning doctors (barring plastic surgeons and other cosmetic work) would earn less, running a medical company of any sort would probably be less profitable. A single payer system would also cut some intangible costs, eliminating things like being out of network.

The harm to innovation comes in with the ability of the system to negotiate prices. Because companies are up against a harder bargaining partner, they can't charge as much for new drugs or techniques. It's still going to be more profitable to have a new drug to sell than to not have one to sell though. A lot of this problem is offset by universal coverage, though! Drug companies can't charge as much per patient, but they get a lot more patients. Big Pharma was for the PPACA, once they won a few concessions.

[CorruptUser]

$8.4m is the average value of an American citizen according to the EPA (it might be too high, actually). Obviously an old codger that has one foot in the grave is probably not worth as much as a young adult fresh out of college.

[Qaanol]

But a system that has a way to value QALY improvements and approves or denies treatments based on that would be a solid system.

Obviously an old codger that has one foot in the grave is probably not worth as much as a young adult fresh out of college.

ITT: Vaniver and CorruptUser support death panels.

Spoiler:

It had to be done.

[Ghostbear]

The United States is pretty notorious for having very strict regulatory hurdles to getting drugs approved. It's quite common for drugs to be approved in Europe before the U.S., if they're ever approved in the U.S. Drugs for Psoriasis that doesn't respond to other drugs, drugs to help people recover from anesthesia, and new treatments for diabetes. That being said, this isn't always the case. The U.S. has faster approval for cancer drugs than Europe, probably both because many cancer drugs come from biotechnology, where the U.S. holds an advantage over Europe, as well as the fact that the U.S. has a very strong Cancer advocacy faction. And there are drugs that are approved in Europe and then subsequently withdrawn, due to either higher risks or lower benefits than first believed, such as Acomplia.

I tend to agree with Vaniver that the U.S. drug approval process is overly cautious (as in, we're hurting more people by not letting useful drugs come to market than we're helping people by preventing potentially unsafe drugs come to market), but reasonable people may disagree about the appropriate barrier to approval.

Maybe we're discussing something different, but I don't think that really points to it being non-functional or an onerous burden; merely that it could be improved some. Which isn't something I'd deny. It seems, based on your post, that the proper balance is somewhere between Europe's setup and our current one.

I don't see what I'm ignoring. The iPad example is a bad one, the statement that health care should be paid for by the recipient is one I agree with, and I agree with the economic logic.

The iPad example was half his idea: "people should be happy to pay $x a month for drugs, because some other people pay $x for gadgets".

Yes.

Under any feasible medical system, not every life-extension is worth purchasing. If you don't agree with that premise, we can't have a meaningful discussion about life on Earth.

If you mistook my statement for a literal "all cases should be paid for, period" then yeah, not all of them is worth purchasing. The examples at hand seem to be focused more on the plausible end of the pricing spectrum however, so your answer doesn't really seem to further the conversation.

"Reasonable to you?" Are you a doctor? Are you well-read on drug policy and medicine? Can you name the 1962 regulation change that I referred to without looking it up?

What a bunch of arbitrary limitations. Vaniver's discussions: those without medical degrees need not apply? Are you a doctor? Why the does it matter? What does any of your attacks on my qualification to speak in this discussion have to do with whether it makes sense to test for efficacy? Maybe it doesn't, but you haven't presented an argument here at all, let alone an argument against it, just told me you don't think I should be in this discussion.

I refer you to the last paragraph of my previous post.

I refer you to "Do you have any sources detailing how it is non functional?". You can tell me the FDA is a problem until you're blue in the face, but just saying it, with no presented facts or further logic, isn't going to convince me of anything.

[Vaniver]

Because of the system's huge bargaining power, they'd be able to negotiate prices of care lower.

Prices of care, while costs for patients, are revenues for care providers, and now we're exactly at the incentives that I'm talking about. To the degree that less money goes to health care, it is less attractive to invest in improving health care. (As mentioned before, total health may improve if incentives are aligned towards improving health rather than providing care. Paying people to floss would probably do more for dental health than fancy new equipment for dentists.)

Drug companies can't charge as much per patient, but they get a lot more patients. Big Pharma was for the PPACA, once they won a few concessions.

This can't go both ways, though. Either costs are lower because pharmaceutical companies are being paid less, or costs are the same because pharmaceutical companies are being paid the same. (Alternatively, Big Pharma benefits while the pharmaceutical industry as a whole suffers; this typically falls under "regulatory capture.")

ITT: Vaniver and CorruptUser support death panels.

Panels are both wasteful and inaccurate. I support death formulas.

The examples at hand seem to be focused more on the plausible end of the pricing spectrum however, so your answer doesn't really seem to further the conversation.

There are many people who are not willing to agree with that premise, or who object to "the market should set the threshold" with "thresholds are bad." Once you agree that some people should die when it would be possible for them to live, then it's just a question of who and why.

The standard argument for markets is they assign values to values- that is, tradeoffs. Everyone wants the indigent to be healthy, everyone wants the environment to be spotless, and everyone wants an iPad. But the question of how people will choose to allocate scarce resources among those (and also future needs) is a difficult problem to solve, and markets are the best way to answer that question in a way that both respects individual choice and incentivizes individuals to promote the values of others. (If I'm better at improving the health of the indigent, and Bob is better at improving the environment, we can each specialize in doing what we do best, leading to better health and a cleaner environment.)

Requiring individuals to provide the cost of their medical care ensures that everyone (on expectation) gives more to other people than they take from them. (Insurance that lowers individual cost variance is very different in imapct from coverage that lowers individual cost mean.) Oftentimes, people are motivated enough by the existence of others to subsidize their existence, and so one should expect that to be a part of a market with humans.

Now, a single-payer institution is probably one of the most efficient ways to improve the health of the indigent, and many voluntary ones have existed over the years. (During the middle ages, when starvation was often a more pressing concern than medical care, churches turning alms into food for the poor can be seen as a single-payer institution, though it's a cleaner example if they contracted out to a baker than having an in-house baker.) There are strong reasons to believe an institution focused on QALYs for everyone will be the best use of charitable medical dollars. For example, it's unlikely that the visibility of a disease will be very strongly correlated to its prevalence times the effectiveness of dollars spent on it; breast cancer research is probably overfunded compared to other cancer research.

What a bunch of arbitrary limitations. Vaniver's discussions: those without [experience] need not apply?

Fixed. No, I'm not a doctor, but I'm familiar with off-label prescriptions (i.e. the pre-1962 system with some unnecessary limitations). My expectation is that if you haven't heard of the Kefauver Harris Amendment, you haven't seen any serious examinations of whether or not it's been good for American healthcare. (It hasn't.)

As is, the efficacy requirement has costs but no benefits. Previously, a drug needed to go through safety trials to be put on the market, but then efficacy was up to doctors, scientists, and the public to determine. Now, a drug needs to go through safety trials and then efficacy trials. The efficacy trials only determine what goes on the label, though- doctors can prescribe the drug for any purpose.

Oftentimes, though, side effects become primary effects (like with Rogaine, originally designed to treat high blood pressure), or effects are discovered, published after a few months, and then doctors start prescribing the drug based on the study, rather than waiting years for the FDA to catch up.

Alternatively, it may be that some drugs treat only a segment of the population. With just a safety trial, you make sure drugs are tolerably dangerous, and then let everyone figure out what it's useful for. It might be that something like depression is actually, say, six different chemical imbalances, each of which is best treated by a different class of drug. The only drugs that made it through the FDA, though, are ones that were effective enough on the sample of depression patients that were in the FDA's study. It's not obvious that we would be able to identify the chemical imbalances from how people respond to the generalist drugs that exist, though it might become obvious if we had access to specialist drugs that weren't effective on the general population.

(Even the safety requirement has downsides: there are treatments for lethal conditions that aren't approved because they have crippling side effects. Many patients, though, see the trade as worthwhile, and the only other alternative offered by the FDA is death.)

[CorruptUser]

But a system that has a way to value QALY improvements and approves or denies treatments based on that would be a solid system.

Obviously an old codger that has one foot in the grave is probably not worth as much as a young adult fresh out of college.

ITT: Vaniver and CorruptUser support death panels.

Spoiler:

It had to be done.

Any form of health care without infinite funding WILL have something akin to a death panel. It's impossible to avoid; who do you give the organ to, the old chain-smoker or the young (otherwise) healthy guy?

[Ghostbear]

[... ] and markets are the best way to answer that question in a way that both respects individual choice and incentivizes individuals to promote the values of others.

In a basic sense, I don't think I'd say anything you wrote in that section wrong, but what do you do when the market is such that it will not balance itself? Whatever the reasons for it, pharmaceuticals is more or less an oligopoly market. When someone needs treatments either to function or to just plain survive, the demand is going to be sufficiently inelastic that you could very plausibly be seen as exploiting their situation. Having some interference to control that level of exploitation, while still ensuring that those companies aren't burdened such that they can not profit off their work, just seems like common sense to me. A free market might be ideal, but mo free market exists, so I am not willing to ascribe some infinite wisdom to the results of the market, such that I would not be willing to allow or encourage some interference with it.

Fixed. No, I'm not a doctor, but I'm familiar with off-label prescriptions (i.e. the pre-1962 system with some unnecessary limitations). My expectation is that if you haven't heard of the Kefauver Harris Amendment, you haven't seen any serious examinations of whether or not it's been good for American healthcare. (It hasn't.)

I did not express my frustration there without reason. My issue with your statement was that you offhandedly wrote off my ability to contribute to the discussion because I did not have the exact same background knowledge as you. You didn't even give the name of the amendment in the first case, how many people in this discussion do you think specifically knew of it? Having some direct experience with the topic is necessary for many discussions (best shown in places such as the non-english, programming, math, etc. threads in other sub-forums), but it isn't always. Being told "No you're wrong, because I know x", without even being told what x is, is very irritating. If there are relevant sources of information I should be considering, I would find it far more useful for the discussion to be told what they are (or even better, linked to more information on them) than to be told outright that I'm wrong for not including them in my analysis.

As is, the efficacy requirement has costs but no benefits. Previously, a drug needed to go through safety trials to be put on the market, but then efficacy was up to doctors, scientists, and the public to determine. Now, a drug needs to go through safety trials and then efficacy trials. The efficacy trials only determine what goes on the label, though- doctors can prescribe the drug for any purpose.

This bit leads me to draw a similar conclusion what I had for buddy431's comment: that the regulations aren't perfect and are not flexible enough to take into account specific instances, such as with the side effects for potentially life saving medications you listed. That would not lead to me think it needs to be torn down (and the fields salted), merely that it needs to be reworked around the issues that have been found.

It also still doesn't strike me as being so onerous as to be the difference between pharma being a high barrier to entry market and not being one.

[Vaniver]

In a basic sense, I don't think I'd say anything you wrote in that section wrong, but what do you do when the market is such that it will not balance itself? Whatever the reasons for it, pharmaceuticals is more or less an oligopoly market.

How much I care, and what I would do about it, primarily depends on why the market doesn't balance itself. If there is a high barrier to entry for engineering reasons, then an oligopoly is the efficient solution.

Sometimes, the oligopoly exists for non-engineering reasons, typically because of non-engineering barriers. In those cases, removing the barriers is typically the way forward.

For example, break the drug lifecycle down into phases. First the chemical formula is developed; then the formula is produced as pills on a small scale, then tests are run, then the formula is produced as pills on a large scale. Neither formula labs nor pill factories lead to oligopolies for engineering reasons. (The biotech startup ecosystem contains many formula labs, and there are many, many pill factories out there.)

Now, the other perspective is to look at it by conditions, and there may only be one or two effective treatments for any particular condition. I'm not sure we want to get into an intellectual property discussion, though.

When someone needs treatments either to function or to just plain survive, the demand is going to be sufficiently inelastic that you could very plausibly be seen as exploiting their situation.

I think the response to this hinges on how you view intellectual property. If someone's default state is death, and you invent a way to keep them alive, then it seems like anything they're left with above death is an improvement thanks to you. If you instead discover something that's common property, fencing people out and charging a massive toll at the gate makes them worse off.

The current patent system seems like a reasonable compromise- allowing inventors to recoup their investment risk by milking patients in exchange for eventually turning those inventions into common property.

[sardia]

In related news, Santorum sweeps all Missouri, Minnesota, and Colorado. http://www.nytimes.com/2012/02/08/us/po ... f=politics
Technically, he could lose Colorado, but the effect is the same. A long drawn out nomination, yuck. =\ Oh, and the nomination is still Romney's to lose since he has the advantage of being well funded, organized, and isn't splitting the anti-Romney vote.

[Ghostbear]

Sometimes, the oligopoly exists for non-engineering reasons, typically because of non-engineering barriers. In those cases, removing the barriers is typically the way forward.

And what if you can't get those oligopoly broken in a reasonable time frame, what if it can't be broken at all? That's what I was trying to get at; sometimes you have to take an action, which from a market perspective might be non-optimal, to solve an issue created by market conditions. Sometimes, those market conditions can not be fixed, whether it be for political or technical reasons. Even when you can fix those conditions, that fix will not be immediate, to say nothing of the possibility that that fix might not work at all! I don't believe people should be left out to dry for the hope of something better- I always try to keep in mind the saying "don't let the perfect be the enemy of the good". We have a "good" solution now, competing with it are two (or maybe more, or maybe even less, depending on your outlook- I'm trying to use your prior examples here, however) "perfect" solutions in the form of a fixed market or a single payer health care system. I don't think we can fix the market in any reasonable manner, and I can't possibly see them passing a single payer system any time soon in the US- they couldn't even get it in 2008 ( ).

So we can work with what we can do now, or hold out- possibly indefinitely- for something better.

In related news, Santorum sweeps all Missouri, Minnesota, and Colorado.

I think Romney just might be the single worst "inevitable" candidate ever; he can't even decisively shut out the clowns he's running against. He even had a significant win in Colorado in 2008. Every time he seems on the verge to locking up the nomination, he gets handed a noteworthy defeat. It must feel like a giant game of whack-a-mole.

I can only imagine that Obama's staff is happy.

EDIT: Santorum has also apparently officially won Colorado too: 40% to 35%. I think Romney will have a harder time fending off Santorum than he did Gingrich, though I agree that the nomination is still his to lose.

[Jahoclave]

In related news, Santorum sweeps all Missouri, Minnesota, and Colorado. http://www.nytimes.com/2012/02/08/us/po ... f=politics
Technically, he could lose Colorado, but the effect is the same. A long drawn out nomination, yuck. =\ Oh, and the nomination is still Romney's to lose since he has the advantage of being well funded, organized, and isn't splitting the anti-Romney vote.

To be fair. Missouri's vote doesn't count for shit and so the only people who went to vote were seemingly Christian conservatives and people voting on local issues--such as being even more racist and violating federal law. The vote count is massively down from 2008, by a lot. Mainly because of stupid state Republican political bullshit--as is usual for this state, our house whip is an uneducated McDonald's manager. There's going to be a caucus later in the year. So, I don't really see the Missouri result being all that indicative. But hey, if Republicans want to desperately get their ass creamed by Obama, I'm okay with that.

[Diadem]

Wikipedia has a nice list of all the republican primaries. Under 'delegate allocation' however it lists N/A for Colorado, Minnesota *and* Missouri. How can it be N/A? I'd understand 'unknown'. But not applicable? They must allocate delegates some way right?

How many delegates does Sanatorum have now compared to Romney? Wikipedia says 4. But that can't be right. 4 bound perhaps? But what about unbound ones?

[Ghostbear]

Wikipedia has a nice list of all the republican primaries. Under 'delegate allocation' however it lists N/A for Colorado, Minnesota *and* Missouri. How can it be N/A? I'd understand 'unknown'. But not applicable? They must allocate delegates some way right?

How many delegates does Sanatorum have now compared to Romney? Wikipedia says 4. But that can't be right. 4 bound perhaps? But what about unbound ones?

Nope, that's 100% accurate. Missouri's was completely nonbinding, while Colorado and Minnesota had theirs work like Iowa's: the caucus selected the people that will select the delegate (later).