In the world of prescription drugs, the U.S. market pays the stupendous costs of developing new products. It’s not only the world’s largest economy, it’s also one in which drug companies are free to charge what the market will bear. As a result, the U.S. market brings forth most of the new, breakthrough medicines the rest of the world wants. Then the rest of the world�not just Canada but Western Europe and South Africa as well�free rides on this circumstance by mandating lower prices in their countries. As long as these prices are higher than the drug companies’ marginal production costs, the companies will go ahead and sell to those countries. And as long as those countries can’t send the drugs back into the U.S., the system works.

Senator Kerry and the many others who want to legalize drug imports… believe they can achieve everyone’s dream, getting something for nothing. By simply enacting a law, they think they can make the U.S. a free rider on itself. In fantasyland, no one would have to pay for drug development at all… Legal drug imports would force a new trade treaty with Canada and spark a reordering of the drug marketplace that would lower prices in the U.S. and raise them in Canada and eventually elsewhere–while disingenuously proclaiming a simple desire to help America’s elderly…

My response:

The author doesn’t seem to be disturbed by other countries benefitting from lower costs, just the problems that arise when those lower cost drugs are imported (back) into the U.S. Makes sense from a business perspective, but the consumer wants those lower prices they can get by crossing the border.

I’m fine with the U.S. as the world’s largest economy bearing the cost of drug research while the rest of the world benefits. I think it’s the right thing to do, and if by some chance I happened to be born in a poor community I’d like to know that there are some ways the wealthier world is striving to level the playing field. (Although in all likelihood I wouldn’t have time of energy to ponder such macroeconomic concepts when I’m more concerned with how I’m going to feed my family that day, etc. Maslow’s hierarchy of needs comes to mind.) Canada isn’t a poor third-world country, and perhaps they shouldn’t be getting such a good deal on American-made and American-developed drugs, I don’t know. I’m not familiar with their health system and how their government-controlled cost system works. I don’t know how and how much they pay for American drugs.

But I don’t think I agree with that thought. The world benefits (over the long term) when developing countries are helped. It’s the same theory as debt relief between nations.

And yes, we are definitely over-medicated!