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Free Minds & Free Markets

Senators Are Misguided in Attempt to Lower Drug Prices

Price controls only create scarcity, impede innovation and raise prices.

Alexander Raths/DreamstimeAlexander Raths/DreamstimeMost Republicans are rightfully counting on their reduction of the corporate income tax rate to lift stagnant wages. They should also continue to fight for a higher standard of living for all by reforming health care, hence lowering its costs. That requires fixing excessive government involvement and getting special interests' influence out of the way. Unfortunately, in that quest for lower health care prices, lawmakers are often tempted to take opposite routes.

Take their recent attempt to cut drug prices by forcing companies to sell you medicine at lower prices. I guess railing against manufacturers for high drug prices and assuming that they are all greedy, dishonest actors is easier than actually looking for the underlying factors driving these higher prices.

In that spirit, a group of Democratic senators sent a letter to the Trump administration demanding implementation of an Obama-era rule intended to penalize drug manufacturers for alleged price gouging. The penalties were proposed as part of the 340B drug pricing program, itself an example of how misguided attempts at controlling the health care market from the top down never produce the promised benefits for patients.

The purported aim of 340B is increased access to drugs for the poor and uninsured. Yet being a government program, it goes about it in the most convoluted way. 340B effectively mandates—by making it a requirement for participation in Medicaid—that manufacturers reduce prices for participating clinics and hospitals regardless of whether they pass any savings on to patients or whether the patients who ultimately receive the drugs are poor or wealthy.

This system is terribly designed. It lets hospitals take advantage of an arbitrage opportunity at the expense of drugmakers and has done little to nothing for patients. Hospitals get access to drugs that are 30 to 50 percent cheaper than list prices and are still allowed to offer them at full cost, simply pocketing the difference. Obamacare made the problem worse by drastically expanding eligibility for hospitals to participate in the program. The number of hospitals enrolled doubled between 2009 and 2012.

The program has not only failed to benefit patients but also, in some ways, done significant harm. Thanks to 340B's distortive effects—and the fact that the nonparticipating providers that are unable to acquire drugs at deeply discounted prices have been forced to close or consolidate with participating facilities—chemotherapy treatments have shifted dramatically from lower-cost physician offices to higher-cost hospital outpatient facilities. By pushing chemotherapy infusions to hospitals, 340B makes cancer treatment even more expensive.

Drug prices are indeed higher than they should be, but if the senators behind the recent letter want someone to blame, they should start by looking in the mirror. The heavy hand of government is found throughout the health care system, and the drug market is no exception. Thanks to high regulatory barriers, the Tufts Center for the Study of Drug Development estimates a cost of $2.6 billion to develop and bring to market a new prescription drug. Some of this is caused by the nature of the market and the uncertainty of scientific research, but a significant portion is caused by bureaucracies such as the Food and Drug Administration. Such high barriers ultimately suppress competition and reduce innovation, leaving patients to face higher prices and have fewer treatment options.

If members of Congress had cracked open any random Economics 101 textbook prior to passage of 340B, they would've learned that price controls always create market distortions. Instead, many are now urging even more onerous burdens on manufacturers in the form of penalties when they sell their products at a price not approved by the government. There's absolutely no reason to suspect this would work out better for American patients looking for drugs than Venezuela's price control regime, which has reduced a once prosperous nation to the brink of starvation.

It's clear that curbing the cost of health care would go a long way toward providing Americans with much-needed relief. The right way to achieve that goal, however, is one that's unfortunately counterintuitive to most lawmakers. Rather than try to arbitrarily force health care prices down under the pretense of price gouging, they should remove barriers that prevent the market from working effectively and cause prices to go up in the first place.

Anti-gouging policies create scarcity, impede innovation and raise prices. Scaling back government intervention in the health care market would increase the quality of health care and lower costs to consumers, including drug prices.

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  • Scarecrow Repair & Chippering||

    Like thinking you can control a car's speed by twisting the speedometer needle.

    "So let it be written, so let it be done." -- said by Pharaoh and every statist before and after, and obeyed by reality never.

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  • BestUsedCarSales||

    Healthcare isn't the same as anything else in the entire world. This is why it should be handled in a uniquely incoherent fashion.

  • loveconstitution1789||

    In that spirit, a group of Democratic senators sent a letter to the Trump administration demanding implementation of an Obama-era rule intended to penalize drug manufacturers for alleged price gouging.
    You lost... losers... and you are not in a position to demand anything. The media always presents these demands from the Democrats as (1) that the demands be taken seriously and (2) that the demands be taken seriously.

  • loveconstitution1789||

    The only way to get drugs prices to reflect market prices is to end Medicare, end Medicaid, end ObamaCare, and return health care to the free market.

  • Citizen X - #6||

    The headline could have stopped after "Senators Are Misguided."

  • Alan Vanneman||

    It is government, via patent laws, that creates the market for drugs, "distorting" the supposed natural market into existence. Dr. de Rugy makes no mention of the "creative" ways that drug companies exploit the laws they helped write--for example, conspiring to thwart generics from entering the market. I can believe that 340B is less than perfect, but to cast all the blame on government is, well, predictable but not, you know, honest.

  • JunkScienceIsJunk||

    Patent laws don't create the market for drugs. The demand for drugs creates the market for drugs. Patent laws distort the market for drugs by setting up artificial monopolies with the express intent of eliminating competition in order to increase revenue for a drug "developer" (the development almost always occurring as a result of the sweat of public sector-funded individuals who very often end up with no financial stake in the product).

  • Sevo||

    "It is government, via patent laws, that creates the market for drugs, "distorting" the supposed natural market into existence."

    That's beyond your normal level of laughable.

  • m.EK||

    Actually, to blame the government is honest. Although they are simply stooges doing what they are paid or coerced to do and say. The government is the "legitimate" tool being used to control and subjugate.

  • JunkScienceIsJunk||

    In my opinion, pro-crony capitalism articles don't belong on a website that claims to be libertarian, but maybe that's just me.

    The author would have a valid point if basic and translational science research DIDN'T mostly occur in the public domain and by public funding. But given the current hybrid public/private model of drug and device development, giving drug companies unilateral freedom here is basically akin to giving them taxpayer subsidies.

    Clearly, the problem here is government intervention. But it's not the price controls, it's the subsidies. If there are going to be subsidies, then it's not unreasonable for the government to get something back, whether it's in the form of price controls or preferred pricing for medicare/medicaid. Or, even better, the libertarian solution: end the subsidies, end the "intellectual property" protectorate, and let prices naturally fall due to competition and market dynamics.

  • loveconstitution1789||

    A lefties take on how to fix the market.

    Ooops, you have some wrong statements in there "But it's not the price controls, it's the subsidies".
    It's both things that are a problem.

  • JunkScienceIsJunk||

    Please read it again. I'm not advocating public funding. I'm merely acknowledging that it currently exists. Pull public funding and government protections, and then you can have a free market. Until then, trying to layer free market principles onto something that is basically a public institution, all while making government policies intended to limit competition, is pretty much the definition of crony capitalism.

  • loveconstitution1789||

    Don't negotiate. Just end public medical care and health insurance.

  • JunkScienceIsJunk||

    Great. But that's not going to happen. It would be nice, and we should continue to advocate for it, but in the meantime we should also advocate for intermediate measures that are more realistic and immediate under the CURRENT landscape.

    So when the question is: continue drug company subsidies or end them? The libertarian position should be to end them. When the next question is: if you can't end those subsidies, and you can't prevent government from continuing to build monopolies, do you allow the drug companies to fleece the public while not giving anything back? My answer to that is no.

    Libertarians make similar arguments re: public education. The libertarian position is to end public schooling. But if that can't happen, then the question becomes: do you advocate due process and free speech in public schools? Most libertarians say yes. Most libertarians don't refuse to answer the question simply because they don't believe in public schooling.

  • NotAnotherSkippy||

    No, your answer is to confiscate their IP in the name of social justice. But hey destroying the incentive to innovate has never hurt anyone and the government invented the internet or something. Wanna bring up evergreening? Please bring up evergreening...

  • JunkScienceIsJunk||

    In the name of "social justice"? How about in the name of property rights? Only one of us is suggesting government intervention in the free association of people and the dissemination of information, and it's not me. Your statist position REQUIRES that the government institute protectionism to support a contrived and anti-property agenda, under the false premise that it will be good for the economy and for innovation. This type of social and economic engineering is at its core anti-libertarian.

  • NotAnotherSkippy||

    Right, see we just call IP not property and then magically we can do what we want. See you just want to limit my driving across your property because your STATIST position is that the government allow you control over that piece of land under the presumption that it will benefit the economy.

  • NotAnotherSkippy||

    And what's even better is that ALL of your supposed university subsidy to industry consists of... IP. I mean you can't make this up.

  • JunkScienceIsJunk||

    I didn't advocate IP anywhere in this discussion, nor did I advocate public funding of research. You're setting up a strawman to attack these positions, which I very clearly don't hold.

  • loveconstitution1789||

    "The author would have a valid point if basic and translational science research DIDN'T mostly occur in the public domain and by public funding. But given the current hybrid public/private model of drug and device development, giving drug companies unilateral freedom here is basically akin to giving them taxpayer subsidies."

    "do you allow the drug companies to fleece the public while not giving anything back?"

    What does this mean then? What do you mean by giving back? Force these pharm companies to charge less (taking their right to IP recovery costs) or preventing them from having patent rights (taking their right to IP)?

  • JunkScienceIsJunk||

    Well it's a tricky subject. When the government funds the development of a new diagnostic method, for example, and the diagnostician performs this new method and asks for higher medicaid reimbursement from the government (leading to greater profits for the diagnostician), should we just chalk that up to the government being benevolent? Or should we demand that the taxpayer money that was allocated to the technological development be returned to the taxpayer in the form of discounted service? Or is there a better form of the return to the taxpayer?

    Likewise, when the government intercedes in the free exchange of goods and services between private individuals so that a particular drug company can increase profits, does that drug company not owe the government anything?

    Clearly, the answer is to not publicly fund private industry, and to not intercede in the free association between people. [I say "clearly", but Skippy apparently doesn't agree] But if removing public subsidy isn't on the table, what should the libertarian position be? Or in your case, what should the conservative position be?

  • NotAnotherSkippy||

    And let me freely associate with yoir bank account. It's only information. Now IP remains a conflict for libertarians, but you've made your liberal point of view very clear.

  • JunkScienceIsJunk||

    Your idea that IP is what protects the assets in your bank account shows a fundamental lack of understanding about what it is.

  • NotAnotherSkippy||

    No, your misunderstanding that information, by definition, is not property while at the same time valuing the secrecy of that information demonstrates your lack of any logical consistency.

  • JunkScienceIsJunk||

    You're right - information is not property. Even advocates of IP acknowledge it's not property (that's why there's a separate set of laws and regulations for IP, quite apart from laws against theft and larceny). And privacy is something entirely different -- also nothing to do with property. I can't tell if you're trying to make analogies or if you're just confused.

  • Qsl||

    But if removing public subsidy isn't on the table, what should the libertarian position be?

    Not necessarily the "libertarian" position (my god what a clusterfuck that would be), but the expedient position would be for the company to pay a licensing fee to the government for their role in the research. Likewise, the government could also sell the license to other companies (giving a portion to the partnership company).

    The non-corporatist swinedog answer would be importing drugs from foreign markets. It is bad enough government is overseeing IP. They shouldn't be defining markets as well.

  • JunkScienceIsJunk||

    Universities license IP derived from academic research to industrial partners all the time, so I don't think your idea is unreasonable at all. But one of the problems with the ever-changing landscape of IP is that the information it "protects" changes by whim of the legislature, so what is protectable now may not be protectable in the future, and vice versa. [there was a just a landmark change like that only a few years ago, and it had huge implications in the area of molecular medicine]

    But that only partially solves the problem. Basic science research is not and never really has been protectable by IP. Understanding cell mechanics, for example, may have a direct impact on treatments for certain disease, but would not (and should not) be protectable by IP.

  • NotAnotherSkippy||

    Understanding a cell mechanism is no different than understanding how to apply that mechanism. Both are knowledge which is what IP at its heart protects for a very limited time. IP basically is basically just regular propert with a built in eminent domain timer.

  • JunkScienceIsJunk||

    Understanding a cell mechanism is no different than understanding how to apply that mechanism.

    Facepalm.

    Both are knowledge which is what IP at its heart protects for a very limited time.

    No, IP doesn't protect a discovery of a scientific phenomenon.

    IP basically is basically

    You need to spend more time reading about what IP is and what it "basically" does, paying close attention to the recent changes to the law about what is and isn't covered in the US.

  • NotAnotherSkippy||

    I expect you go around life frequently in that smashed face state. You seem to seriously imply that basic research is SPECIAL. IP is a subset of knowledge just as basic research is a subset of knowledge. Or do you seriously contend that IP does NOT protect knowledge? Wow, I mean, just, wow.

    You need to spend more time trying to be logically consistent.

  • JunkScienceIsJunk||

    Or do you seriously contend that IP does NOT protect knowledge?

    Yes, I contend that IP does not protect all knowledge, which is what you suggested in your previous response when you said that discovery of mechanisms of cell mechanics are protectable by IP. I'm surprised you haven't taken the opportunity to google these concepts and backtrack, but instead decided to double down.

  • Robert||

    Everyone benefits from something or other produced by some gov't somewhere, sometime, on some taxpayeer's dime. Why try to make up for this one somehow, when all the others are in play?

    There are tons of gov't-provided services that fail to capture their benefits in user fees, & it would be unwieldy to do so at this stage. Medical products is hardly the only field in which gov't-funded advances in tech have led to $ for biz. What about aerospace? Atomic? Weather forecasting? What if it's a foreign gov't?

  • NotAnotherSkippy||

    No you claimed that government subsidized industry through university research. The only way that is true is if you grant that IP is real, so have fun with that cognitive dissonance.

  • JunkScienceIsJunk||

    You're missing something pretty important here. Much (maybe even most?) of what government subsidizes in the academic research arena is not currently protectable by IP. That doesn't mean the research didn't have a significant impact on the development of drugs, devices, procedures, standards, or any of the technological developments that improve health.

    But as I've said countless times, the fact that I recognize that the government has created this stupid thing called IP -- or that the government stupidly subsidizes medical research -- is not an endorsement of these policies.

  • NotAnotherSkippy||

    Man are you dense. Let's walk through your "logic" here:

    IP isn't real property
    The government creates research product (IP) which is the subsidy provided to industry.
    But since you think IP isn't real, then exactly how is this a subsidy?

    By your definition that government research may be a waste of money but it can't be a subsidy because it isn't real. It's no different than the government paying ppl to pray for your soul, or are you now willing to admit that if you use my research (IP) that I am subsidizing you (or you are stealing)?

    Now if you want to prattle on about unfair monopoly protection of IP that's a different (and still wrong) story.

    Oh, and just for the record government CAN protect and license that research. It's called the Bayh-Dole Act of 1980, but thanks for playing.

  • JunkScienceIsJunk||

    Let's walk through your "logic" here: IP isn't real property. The government creates research product (IP) which is the subsidy provided to industry.

    I've actually said the opposite and I've said it multiple times. Entities - public and private (where do you think most of SpaceX's money comes from?) - conduct research which is funded in part by the government. A small amount of that research results in a product that is protectable by current IP law, but most is not. That doesn't imply that the discoveries are not useful. Newton discovered some things you might have heard of that would not be protectable under US IP law, but I'm sure you acknowledge they were useful discoveries and that technological advances were built on those discoveries. What this means, however, is that there is no direct revenue going to the people who discovered those things on which technological advances were built.

    When you consider that in medicine the "R" in "R&D" is mostly conducted in the public sector (or by the private sector with public money), and the "D" is mostly conducted in the private sector (or in the public sector with private money), there's a clear alliance between the two. I think this alliance is a problem when the public sector is putting in seed money and not getting anything out of it. In my view, the taxpayer should either get something in return for their seed money, or should demand that they stop providing seed money to private entities.

  • JunkScienceIsJunk||

    Basically, the fundamental problem with your logic here is that you think that only those things that are protectable by IP are useful discoveries. Or, based on your previous response to me, you believe that everything under the sun is protectable by IP. Both are wrong.

  • loveconstitution1789||

    Luckily, you don't make the rules and far smarter men have created IP protections and patents to incentivize inventing.

  • JunkScienceIsJunk||

    And even far smarter men than those have established that IP as a construct is unnecessary and does not conform to the concept of property rights that remains one of the central tenets of libertarianism. For example, Murray Rothbard was critical of IP in its current form (and said that it is "incompatible with the free market"), and others like Benjamin Tucker rejected it altogether. These were libertarians though, not conservatives.

  • NotAnotherSkippy||

    Right and absolutely no libertarians support IP, but hey keep aligning yourself with left-libertarians like sheldon richman and trying to claim to moral highground of theft.

    Seriously you cannot simultaneously hold that public research is a subsidy and valuable and that it is not real and holds no value. Well I guess you can do anything as long as it isn't self-consistent.

  • JunkScienceIsJunk||

    Seriously you cannot simultaneously hold that public research is a subsidy and valuable and that it is not real and holds no value. Well I guess you can do anything as long as it isn't self-consistent.

    You seem stuck on this point after I've already refuted it countless times. You are conflating two separate issues. You somehow think you've "trapped" me because I don't advocate IP and because I think there's value in the research conducted by Space-X, for example, even though a great deal of it came from public money. You, on the other hand, want to invalidate every scientific discovery just because of the source of funding, which is profoundly absurd and contrary to the hard evidence I posted earlier (which explicitly listed 153 drugs directly developed through public funding).

    We ultimately agree that there shouldn't be public funding. But your approach of burying your head in the sand and pretending that public funding has not produced something useful is not supportable by any hard evidence. Whereas I acknowledge that basic science research actually produces useful discoveries and that translational research in medicine (even when it's publicly funded!) can and does directly produce bench-to-bedside technologies.

  • NotAnotherSkippy||

    You, on the other hand, want to invalidate every scientific discovery just because of the source of funding, which is profoundly absurd and contrary to the hard evidence I posted earlier (which explicitly listed 153 drugs directly developed through public funding).

    Are you actually able to dress yourself? Where on earth did I ever claim that every scientific discovery should be invalidated because of funding?! Seriously. Quote the passage.

    Again, let's go through your pretzel logic.

    1) IP is a fiction (you claim you're a libertarian --a left one for sure-- and the advocates you cite would all agree that IP is purely a government fiction so it has no intrinsic value) and only has value imposed by government dictate.

    2) Government subsidizes industry through its basic research which is freely published and unprotected and so cannot be traded and has no intrinsic value.

    3) Subsidies can apparently only be given by governments.

  • NotAnotherSkippy||

    (cont.)

    So let's try to reconcile all of these (can't, but we'll try). Once information exists it has no intrinsic value (#1). Government basic research could be a subsidy if we expanded IP law to cover basic research (that seems to be your frequent argument). Again, it wouldn't have intrinsic value just that imposed by government dictate. OK, that satisfies #1 and #2, right? We're done? Wait, it only has value if the government can deny industry the use of that data, but since it's in the public domain and anyone can use it for free, then it has no exchange value and is literally worthless in the market. So the subsidy value from the government to industry is, um, zero. Oops.

    You can't have it both ways. Either the information has value (the whole premise of IP), or the government did not provide a subsidy. Take your pick (I choose the former while you seem to mostly like the latter with a special exemption for your line of work).

    Now if you want to argue that the government wasted that money and that IP is a fiction, then at least that would be self-consistent.

  • JunkScienceIsJunk||

    Answer this question: did Newton's laws of motion have "intrinsic value"? If the answer is yes, would you advocate IP protection for such a discovery? If the answer is no, are you concluding that his discovery had no utility?

  • JunkScienceIsJunk||

    1) IP is a fiction (you claim you're a libertarian --a left one for sure-- and the advocates you cite would all agree that IP is purely a government fiction so it has no intrinsic value) and only has value imposed by government dictate.

    I don't know why you keep using the word "fiction" when it's a real thing. Maybe you stumbled on some Bastiat and didn't quite grasp what he was saying. But if I'm understanding you correctly, that I dispute the justification of the construct of IP and agree with others before me that it is incompatible with the free market, then fine.

    2) Government subsidizes industry through its basic research which is freely published and unprotected and so cannot be traded and has no intrinsic value.

    Has no intrinsic value? You also said that I think it has more value than you think it does. Please be consistent.

    But yes, support of basic research is one avenue where the US government subsidizes industry. Another example is where they directly give industry cash in the form of grants. And another example is where they use taxpayer money to fund enforcement teams that ensure that certain industrial partners can have a monopoly. And yet another example is where the US government artificially raises the barrier to entry by enacting draconian regulations. And yet another example is where agencies arbitrarily specify that certain manufacturers and drug companies can receive receive reimbursement while others can't.

  • NotAnotherSkippy||

    No, the fundamental problem with your logic is that you aren't applying any. The only reason you are opposed to IP is because you think you won't benefit from it. Again, you are placing special.emphasis on the R part regardless of the fact that that is actually the smallest part of the R&D expenditure. So it's a simple case of sour grapes and envy.

    Is CRISPR CAS9 patented? Why yes, yes it is. Plenty of basic research can still lead to patents. Sorry that yours has been so unproductive.

  • JunkScienceIsJunk||

    The only reason you are opposed to IP is because you think you won't benefit from it.

    You conservatives have always accused libertarians of this. You've always said that we only support legalization of marijuana because we're pot smokers. You've always said that we only support immigration rights because we personally want cheap labor. And you've partnered up with the democrats to suggest that we oppose taxation because we don't want to pay it. The "you only believe that because you personally stand to gain from it" is the oldest of cop outs.

  • NotAnotherSkippy||

    Actually the True Scotsman is the oldest cop out, but you can have your fun.

    You left-libertarians always accuse us right-libertarians of denying you your freedoms to take our intellectual property. How dare we.

  • loveconstitution1789||

    What question?

    Not negotiating does not mean that you don't discuss the matter. When you don't negotiate there are just not going to be concessions by that side.

    Negotiating with lefties just prolongs the misery. Just say no to public funding for medicine and to subsidies. Work to eliminate this stuff from budgets.

    Its one of the reasons why Trump won. He negotiates from positions of strength unlike most politicians.

  • NotAnotherSkippy||

    Ahn the sweet song of the lefty concern troll with the typical ephemeral claims of reality. "See the government is already involved in a limited way therefore more intervention is warranted. And IP isn't real property because I want it and it's inconvenient for me."

    Or we could go to a more authoritative source.

    This cultural divide between academe and industry is a prominent reason nearly 90 percent of recently approved medications received no public funding during development.

    But you just keep going with your feelz.

  • JunkScienceIsJunk||

    This cultural divide between academe and industry is a prominent reason nearly 90 percent of recently approved medications received no public funding during development.

    The notion that academic (or non-academic) scientific institutions don't contribute to the useful development of medical technologies is not supported in the article you cite. The only evidence the author uses to support that stance is that HIS particular research is not directly useful in that role (even though he misrepresents it elsewhere as useful with translational potential, which basically means he's lying). Meanwhile, there have been major cancer treatments that have been approved THIS MONTH that were born from government-funded research.

    This isn't support of the idea that government should continue to fund research. I think the private sector is fully capable of doing it. And you would probably be shocked to learn that many of the top scientists in the world who currently receive a lot of federal funding would probably be the same ones funded by private funding. How do I know? Because I, and many others, receive funding from both sources to conduct essentially the same type of research. One thing that's obvious is that the pool of federal funding is presently a lot bigger than the pool of private funding for the "R" in "R&D".

  • loveconstitution1789||

    Maybe private research & development would do better things and generate more money, if government were not involved.

    We will probably never know in my lifetime.

  • JunkScienceIsJunk||

    I think you are exactly right. Private R&D would probably be more efficient and maybe more effective, but I agree that we can't know that for sure and probably not in our lifetimes.

    I think what a lot of people fail to recognize is that government can (and does) box out other industries. For example, the private road building industry takes a significant hit when government declares that they're the ones who should build and contract roads. Or, as many libertarians and anarchists have written about, private security companies take a major hit when the government declares that security is their role and even puts policies in place to limit the ability of entrepreneurs to get into that area.

    Healthcare R&D is no different. The US government says it's going to be their thing. Drug and device development companies reallocate their funding accordingly.

    Also -- anyone who thinks that these companies aren't using academic findings -- go to a scientific conference. The vast majority of speakers at most major conferences come from academia, and the vast majority of people in the audience taking pictures of the powerpoint slides or the posters at the poster sessions are usually from industry.

  • NotAnotherSkippy||

    But you don't believe in IP so therefore any academic finding is literally worthless. I just love you actively argue against yourself.

  • JunkScienceIsJunk||

    The only evidence the author uses to support that stance is that HIS particular research is not directly useful in that role (even though he misrepresents it elsewhere as useful with translational potential, which basically means he's lying).

    Also, just to support this point (which you probably don't believe) --

    The proposals for all NIH funded projects are freely available and so are the progress reports. You simply have to search by his name and you can read all of them. In every single R01, R03, and R21 he's had funded since the 90s, he's explained the contribution of his basic science research to the development of translational therapeutics and interventions. The fact that he was apparently unable to fulfill his promises and predictions, or at least spin his research off into a usable service (directly or indirectly) is a demonstration of his own failure.

    Basically, he should speak for himself, not for everybody else.

  • NotAnotherSkippy||

    Of course you can cite all of the vast examples of others who could, right?

  • JunkScienceIsJunk||

    You're not seriously suggesting that basic science research in biology and medicine -- which is overwhelmingly conducted by academic and publicly-funded entities -- has no bearing on the development of diagnostics and therapeutics, are you? If this is what you're suggesting, I really don't know how to respond other than to suggest perhaps you ask your doctor what he thinks about that statement.

    In the meantime, you could read this article:
    http://www.nejm.org/doi/full/1.....ype=Print&

    It only deals with drugs... devices, diagnostics, standards, surgical procedures, public health interventions, etc are not addressed, and are each even more likely to be born from public funding.

    Again, before you twist my intent, I'm not ADVOCATING that the public should fund any of these. As I've already said, I think the private sector would (mostly) pick up the slack if the government stopped funding them. But I'm also not burying my head in the sand and calling the outcomes of publicly-funded research worthless.

  • NotAnotherSkippy||

    No, what you are arguing is that intellectual property is a fiction but that somehow this fiction is also a real subsidy (actually I think you're just frustrated that the world doesn't value ehat you do more).

    In the meantime why don't you read

    this.

    And

    this.

    Now you can do all the special pleading you want about basic research (gosh, can I guess what you do?) vs. applied but the fact is that without both you don't have a product. So, sorry, not buying it.

  • JunkScienceIsJunk||

    No, what you are arguing is that intellectual property is a fiction

    It's not a fiction. It's a real construct that was invented by governments to steer the market in a certain way. According to the US constitution, its purpose is to "promote the progress of science and useful arts," which was necessary because the framers of the constitution did not believe in Austrian economics and the power of the free market.

    What I'm arguing isn't that it doesn't exist. I'm arguing that it's a stupid and unnecessary construct, like most of the US government's interventions in the economy. To steal a sentence from mises.org, "the problem with IP is that it isn't grounded in property rights — as all libertarian rights must be — and in fact requires government to violate property rights for its enforcement."

  • loveconstitution1789||

    Why would I want to spend all my money and time to invent something when someone can come along the next day and literally reverse engineer what I made and sell it?

    Patents are a trade off to inventors for a period of time, so they have incentive to recoup some of the invention costs. The period should probably be around 10 years but that is debatable. This copyright shit of 70 years plus the life of the artist is too much.

  • JunkScienceIsJunk||

    History is full of examples where companies profited from things that were not protectable by IP. My mises.org link above lists several. The most straightforward example in medicine is the fact that Bayer makes billions of dollars on aspirin, despite no longer having the exclusive rights to produce and sell it. Or the amount of money that J&J makes off acetaminophen because they stamp the name "Tylenol" on the box.

    Generally I reject government-created constructs aimed to stimulate growth of an industry or an economy because 1) I think it's mostly unnecessary; and 2) I don't think the government has the right to confiscate our stuff or to intercede in the free association of individuals.

  • JunkScienceIsJunk||

    ...and just to clarify this point because we're getting a little derailed from the original topic.

    The IP issue and the subsidy issue are two different points. Even if you believe in the very un-libertarian view that laws promoting IP are just fine and not a violation of property rights... you should still reject the idea that taxpayers should provide seed money that ultimately results in the development of technologies that get sold back to them at high margins. First of all, providing seed money for business ventures isn't a legitimate role of government. But if it's here to stay, then it should probably be done in a way that limits the extent to which the taxpayer-supported businesses can fleece the consumers (i.e. the taxpayers).

    The second issue is whether the US government should exert its force and invest millions per year enforcing monopolies for arbitrary lengths of time on behalf of these companies. And whether they should continue to offer this anti-libertarian "service" at no cost (i.e. taxpayer funded).

  • NotAnotherSkippy||

    IP is hardly a settled issue in libertarian circles regardless of your fervent desire.

    For instance.

  • NotAnotherSkippy||

    This is just stupid sophistry. You think that IP isn't something that should be protected because it isn't real property. Then you fall back on the lame reasoning that it is real because the government says it's real even though it's not (dizzy yet?). So we're consistent here, if a private entity publishes basic research that you use then they are subsidizing you, right? In fact ANYTHING they publish is a subsidy, right? Careful, those libertarians would say it isn't...

    And Rothbard also supported copyrights so clearly intellectual property is a fiction for libertarians because the grand master said... oh wait. And patent law has nothing to do with belief or disbelief in austrian economics (which didn't even exist as a school when the constitution was written anyway) and everything to do with free markets which have property rights as their very foundation. The arguments against IP essentially amount to: I want it and it's easy to take so I should be allowed to take it. And don't bring up rival vs. non-rival nonsense.

  • JunkScienceIsJunk||

    if a private entity publishes basic research that you use then they are subsidizing you, right?

    You're outthinking yourself. No, when a private company does something, it's not a "subsidy" to the government. Is it beneficial to society? Perhaps. When Elon Musk donated solar panels to Puerto Rico a few weeks ago, nobody considered that a "subsidy" to the government. "Subsidy" in this context is reserved for when taxpayer money is used to support the business interests of private businesses.

    And Rothbard also supported copyrights so clearly intellectual property is a fiction for libertarians because the grand master said...

    He supported the concept of contracts, and said that a system in which participants mutually agreed (by contract) to not disclose information could be an adequate replacement for the system of IP that the US government dreamed up. His view does not support first-to-file OR first-to-invent, or any other variant.

    I'm sorry that you don't understand IP or the arguments that oppose this state construct.

  • NotAnotherSkippy||

    So you=government in your universe? Only you read it that way. YOU are claiming that government basic research is a subsidy, but you seem to honestly be confused and believe that only a government can subsidize which is wrong at such a fumdamental level, well, I begin to see the root of the problem.

  • JunkScienceIsJunk||

    When the discussion is about taxpayers subsidizing private industry, who then charges taxpayers a price for the services and products that directly resulted from that subsidy, then yes, taxpayer subsidies are the relevant topic.

    It's sort of like having a discussion about subsidizing NFL stadiums and then countering with "yeah the government subsidizes the NFL, but the NFL gives a lot of money to charity so they're subsidizing the government too!" It's a cop out.

  • Heraclitus||

    Wait, this is on Reason and there is no mention of patents? Hmmm, I suspect this is a sponsored article or the Koch's insisted this get published. While we are at it, why not let Medicare negotiate drug prices? Using economies of scale as a bargaining topic are pro-market no? It seems plenty of businesses do it. So why does this article fail to mention that congress explicitly knee-caps these programs from using this tool?

    Folks, this is a great example of how Libertarians can get co-opted by pockets of wealth and forced to sell out. There is no "free" market because when even the Libertarians cannot remain faithful to these ideals it is obvious that no one can. The best we can do is get our hands dirty and negotiate market structures through democratic means and admit that yes, government will be doing some regulating, instead of ignoring the regulating that is already happening on behalf of the wealthy.

  • John B. Egan||

    Glad to see our Congress actually try to do something about the outrageous prices we US Citizens pay for drugs, although it will never be enough.

    The very same drugs made by the same factories and by the same companies are available at 20% to 25% cheaper than what they cost in Canada, Germany, Great Britain and elsewhere. And out Congress 'protects those prices' by not allowing us to buy from those countries. Can anyone really believe that Pfizer, J&J, et al can't sell them to us at those prices if they are making a profit elsewhere? In fact, isn't forcing Americans to pay $300 a month for an Asthma inhaler that can be bought for $60 in Canada an abridgment of that much acclaimed 'free-market capitalism'?

    Unbelievable nonsense! MAGA politics at its finest!

  • m.EK||

    I'm still trying to find where the federal government has the authority to classify any drug. Make some "illegal" and even ban Hemp, a weed of impressive usefulness.
    Where do these "officials" get this authority? Commerce Clause?
    The Oath of Office is a civil contract to abide by the Constitution as written.

    What if we just sued their collective or individual asses and took their property and freedoms? Would that be a deterrent?

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