The drug companies sell out
Photoshop: The People’s Cube
The drug companies have cut a deal with President Obama to help fund his government health care takeover.
In other words: They are subsidizing their own demise.
I have no sympathy for industries willing to collaborate with their own worst enemies.
Don’t come crying when Obama limits your salaries, fires your CEOs, and interferes with your ability to innovate and make profits.
You deserve what you get:
President Barack Obama says the pharmaceutical industry’s agreement to help close a gap in Medicare’s drug coverage will make health care overhaul more possible.
Drug companies have pledged to spend $80 billion over the next decade to help reduce the cost of drugs for seniors and pay for a portion of Obama’s proposed revamping of health care. The deal was struck with Sen. Max Baucus, D-Mont., the chairman of the Senate Finance Committee, as well as the White House.
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Trackbacks
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Categories: Health care
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Congratulations to Ragspierre (#75), who actually posted links that seem at first glance to support his contention that lobbying activity has increased recently.
Of the three links, only one has actual numbers. The last one is a joke — MM style speculation and paranoia that “rings true”. The first one has numbers that come from a right wing think tank disguised as an ethics group. Everyone agrees that new lobbying rules make lobbying less effective than in the good old days of Republican control. They also agree that the impetus for hiring lobbyists is the important issues being discussed. There was no need to lobby against global warming measures under Bush. Drug companies also were on easy street.
Another lie.
I invite the readers to read my links, and judge what they say themselves.
I also invite everyone here to use their logic and common sense to answer this: “Will you increase lobbying in Washington DC when you create a $700,000,000,000,000,000 slush fund, and suspend the laws of market capitalism in favor of fascism?”
HINT: Duh.
The links, again:
http://latimesblogs.latimes.com/washington/2009/03/lobbyists-thriv.html
http://www.politico.com/news/stories/0609/23872.html
http://www.weeklystandard.com/Content/Public/Articles/000/000/016/567nydlh.asp
Research this for yourselves. Lemme know what you find.
Nope: “promotional spending in the US”
This is actually the whole point of the article, hence the scare-quotes around “marketing and administration,” which is how the companies themselves report promotional expenses.
Two firms (IMS and CAM) utilize data queried from various sources to arrive at an independent estimate of these expenditures (my bad, I quoted the analysis based on industry reports, rather than the independent analysis, which separates out marketing and admin. However the net result is not far off).
The author merges the IMS and CAM data to arrive at a better estimate of marketing expenditures (that is, utilizing sources independent of the industry, and without the “and administration” part):
Using the IMS and CAM data (both of which detail promotional expenditures, as opposed to the annual report data, which lumps marketing w/ admin), he determines that
One caveat: the author is Canadian. French-Canadian. Make of that what you will.
lgm, while some of MM’s posts are highly speculative, most are not. Regardless, she always discloses the speculation.
You, on the other hand, lie.
BTW, you are the last person that should ever accuse anyone of paranoia.
“Relative importance?”
A guess by any other name…
Overall, it seems as if he had the answer prior to his analysis. I’d like to see the raw IMS and CAM data.
True.
All of this was a tangent from a statement I made about where big pharma’s expenses come from, but the relevance of this information got lost in the shuffle. How pharmaceutical companies spend/earn their money is irrelevant, as long as they continue to make products that save lives. They take a lot of heat for making/marketing drugs that aren’t life-savers, but what people don’t realize is that those drugs often developed for other more “noble” purposes, and get shunted into other areas of product development when they discover the side effects are more interesting than the intended effects. Vi@gra, after all, was supposed to be a heart medication.
Fair enough.
But I did want to add two more items to the analysis.
1. Many of the pharma companies supplement their R&D budgets and drug pipelines by purchasing smaller R&D companies (companies with no marketing). Such purchases are tallied in a company’s cash flow statement – not their income statement.
2. Many enter into joint ventures and marketing partnerships with smaller drug companies that don’t have marketing arms of their own.
The economic aspects of these practices need to be considered when calculating R&D to Marketing ratios.
They aren’t doing anything that doesn’t help their bottom line, MM. Obama is using them as a prop, but they are using Obama so that they aren’t seen as the bad guy.
The only thing they agreed to here was not raising rates as much as they possibly could. They aren’t cutting anything. If they raise their rates, they’ll just say, ‘oops, sorry’.
This is just a photo-op. It allows Obama to say he has come up with the money when the only thing he has is a pledge that rates won’t go up in the future. This is not coming up with money.
It is the same thing as the insurance companies saying they will reduce the increase in spending a whopping 1.5% over 10 years. They may, they might not (it isn’t a law). But as a result, Obama claims 2T, or whatever amount of money he wants to claim in ‘reforming health care’.
It’s all a show. Drug companies haven’t sold out, they are just playing their part in Obama’s kabuki theater.
Pharmaceutical companies have the bottom line in mind. Something tells me there are mega bucks promised to buy meds for Obamacare beneficiaries. More sales means they can moderate rate increases.
Also, I’m still wondering who presumes to negotiate for the “drug companies”. Would make it some kind of cartel, when in fact they are in intense competition. Which companies are we talking about?
This is clearly a great deal for the drug companies!
In a socialized rationed government run medical system, drug companies will gain an important resource that they can barely access today.
The drug companies will be given access to millions of tired old sick people for their ‘trial’ drugs. Government provided waivers, with signatures mandated by congress, all members of the American public will be performing their final act for the good of the community!
Not only do we desperately need regime change here in the USA, but we need some people willing to stand up and fight for their God given right to liberty. I am sickened by the people who could oppose tyranny, yielding to it in a vain effort to save their own a$$es.
Please, guys, keep something in mind. This is fascist economics. It is not socialism. They are closely related, in that they are both statist systems. But there are important differences.
A private company in a fascist corporatist collective gets to keep capital. It subverts the control of capital, in large measure, to government control as part of the deal. Government, in turn, gives it special protection from the forces of the market, and makes labor part of the collaboration…an integral part of the corporate collective. Any such corporatist collective is, by virtue of the government preference, immune from the “creative destruction” of a normal capitalist venture. They cannot fail, because the government will not allow that destabilizing (from their point of view) situation. Labor-management strife is a thing of the past, as both interests are working collaboratively under the direction of a government-appointed bureaucrat.
This is EXACTLY what is being proposed with the Fed’s expansion into VASTLY enlarged oversight of financial firms. These companies CANNOT fail, and will always be propped up as needed with government funds.
This is classical fascist economics 101.
One very big feature of this model is the exclusion of new, dynamic entrepreneurial companies. The very kind that have been the heart of American innovation and wealth generation. For various structural reasons, they cannot compete with the favored corporatist collective.
Fascist cooperative then is a government-run “Keiritsu?” (I am thinking of the corporate structure of most Japanese firms, Rags)
Well, no not really. There are parallels, of course, but they are really quite dissimilar, I think.
While the government in Japan certainly played an active role in guiding business and working to provide it protection from global competitors decades back (MIDI), they did not directly allocate resources, as I understand it. One feature of fascism, like socialism, is central planning of the allocation of resources. Rather than going to a state-owed enterprise, they go to a corporatist collective, but still under the direction of some ministry or directorate.
Also, companies were capable of failing, if I am not mistaken.
I think the zaibatsu and their progeny were pretty unique, though they have stuff in common with merchantalism. They were very Japanese, and the attempts by others to mimic them have not seen much success.
They present a very interesting model, and I frankly don’t know enough about them to critique them.
One thing that caught my eye. In the past 48 hours or so I have seen a remarkable decline in fawning “I love Obama Because….” postings at DU. And remarkable increase in the number of posts that are actually questioning his sincerity about “change”. Most of them involve lack of action on Freeloader Health Care. LOL! Not time for a party yet, but maybe, just maybe, the left is beginning to get a inkling about what the hell they did in November.
Has the illegal alien access to full health care been factored in this program yet?
James Greenidge
Queens, NY
I’ve noticed a marked decline in the number of “Obama/Biden” stickers on I-5 near Seattle-particularly after Obama broke his campaign pledges about Guatanamo/use of interrogation techniques by Bush. They seemed to disappear overnight.
I do not believe that a lot of lefties have all of a sudden gone rightward-certainly not completely-but I do believe there is doubt and a little fear amongst them about Obama, particularly by the Business/Econ professors/intellects I’ve met on Univeristy of Wshington campus that were once SO enthusiastic about him. I guess they ae starting to see that they really can’t embrace Socialism without destroying the freedom and sanity they had enjoyed under Capitalism – i.e. trying to have it both ways.
You may have misunderstood … when there is no profit there is no reason. Why develop any new drugs, just live on what you have. Cutting R&D saves bundles of money for drug companies … Oh wait, that’s not what they said, but that is what they will do.
Fund R&D by government fiat and see how that works out for you. 9000 useless AIDS drugs and no cancer research.
The support that Obama had from moderates/independents is waning. At least that’s the analysis I read. I’ll have to try to find it to link it here. But it makes sense. The other issue for his support is that he’s losing some of it from the extreme left. The argument for that theory is he isn’t ‘extreme’ enough for them on certain issues, which I think has been cited he not long ago.
That Obama is losing some support for his Health Care Socialization plan is great news for America. Let’s hope whatever is driving that opposition continues to grow. This article explains in part why his plan is a disaster in the making and in general, why the Dems argument for Socialized Health Care is a fraud.
And lets hope that opposition to Obama, the new Enemy of the State, continues to grow as well. His plans for America contradict the principles America stands for.
And here is one doctor’s opinion on the subject.
Big Oil, Big Pharma, who cares. It’s all about demonizing the corporate world and this “agreement” is tacit confirmation on the part of the pharmaceuticals that they are fleecing people. All profit is at the expense of the common man, right?
On the flip side, they need to elevate public service as a noble cause, that way everyone will want to work in the public sector and not a greedy corporation. We’ve seen the seeds sown for years with the cult of the police/firefighter/teacher. Time to reap.
http://townhall.com/cartoons/cartoonist/MichaelRamirez/2009/06/2
Gosh, you know what would fix health care in America?
A simple return to market capitalism, where I pay my care-giver for what I decide, with the help of people I trust, I need and when I need it.
It works with food, clothing, computers…
Just like the First Lady’s University of Chicago Hospital patient-dumping scheme, the drug companies will raise prices to insured patients to pay for subsidies to Medicare and Medicaid.
http://michellemalkin.com/2009/06/19/the-obamacare-horror-story-you-won%E2%80%99t-hear/