Question

Why is it that the pharmaceutical industry is the problem child when it comes to the patent system? What is unique about the market for drugs? In many cases, the patent protection given to pharmaceutical innovators creates a perverse situation in which patients in the U.S. are paying substantially higher prices compared to less wealthy countries for the exact same drug produced by the same manufacturer. Opponents of Big Pharma argue that because of this, U.S. patients are indirectly subsidizing the drug for patients from less wealthy countries by paying substantial markups on domestic drugs. This is buttressed by the fact that it is illegal to import drugs from abroad. To what extent do you agree or disagree with this argument?

Answer 1

Pharmaceutical industry is the problem child because it is very expensive to conduct research and get approval for drugs in the US, which makes the industry avail more incentives to recover the costs they have incurred by using patents and make it worth their while to invest in research and development.

Drugs are an essential part for survival, which makes one question the level of capitalism prevalent in the industry. Ideally it should be affordable and cheap because of the constant demand, but it is expensive.

I completely agree with this statement as US sells drugs at a cheap rate to foreign countries, because they threaten to make the generic version of it instead of buying it from the US. This makes the companies recover the costs which they incur through local consumers. This worsens the market for the products and makes it less affordable.