Hypothetical Situation

N

Norsefire

Salam Shalom Salom
Registered Senior Member
Let's say a corporation discovers a cure for a major disease like cancer or AIDs. The corporation wants to monopolize it and set exorbitant fees on it.


Is it more ethical to allow the free market to prevail or should the government step in and distribute it fairly?
 
So that everyone will be cured. The US government is meant to ensure "the general welfare" of the people.
 
That goes against free market economics, though. The corporation came up with the cure, don't they have the rights to do as they please with it?
 
They would probably move to Hong Kong, in which case, we should invade and take their cure.
 
A US corporation can have it's corporate charter revoked at any time if we feel they are not serving the public interest. For instance, if they start to charge "exorbitant fees" for a lifesaving cure. It would be in the interest of the company to negotiate a fair price. I'm sure that's what they would do.
 
Corporations serve their bank accounts first. The company isn't harming anyone, so I don't understand how it's doing anything illegal so it has the right to monopolize for profit.

It's the government's responsibility to serve the needs of the people, of course the US government can't because it has basically no power.
 
The US government has power over the markets. If the corporation withholds medicine from people in the name of profit, then it's doing something bad. When cures are invented like the cure for polio, not only the US, but the UN gets involved in order to wipe out the disease totally. For humanity. Some things are too important for profit. It's more efficient.
 
Norsefire said:
Let's say a corporation discovers a cure for a major disease like cancer or AIDs. The corporation wants to monopolize it and set exorbitant fees on it.
Is it more ethical to allow the free market to prevail or should the government step in and distribute it fairly?
Click to expand...


In the free market any company gets a patent on their product and can hold the rights to that patent for up to 10 years(i believe) before it becomes available to other companies for generic distribution. That way the original company can make as much profit as it wants for those years then must relinquish its formula to the other companies. Now , if another company were to find out what the components that made up the formula were, they could design another product similar to it for distribution under another name by altering the chemicals slightly to make it look like another drug. That happens in the pharmaceutical businesses many times. By the time a company sues another company for patent infringments , the other company can stall them in courts by having all sorts of things happen, appeals also will happen.
 
The real issue is not what happens to the corporation, as the government can seize the cure and pay fair value for it under the 5th amendment. The problem is the next corporation. If Corp 2 sees that Corp 1 got hosed out of its profits, Corp 2 is not going to spend money researching new cures, as the government wonb't let them take the profits on that. Instead they will concentrate on the next wave of boner pills...because those you can patent!

Actually the whole point of the patent system is that it's a good idea to encourage innovation by allowing people to gouge for 20 years. The period is there to ensure the *next* guy that finding and developing the next innovation will make hiom rich, and to keep the innovations coming.

That said, the government should seize the cure, pay the corporation an exorbitant amount that makes the corporation's officers and shareholders happy (which should be approximately equal to the present value of all the monopoly profits the could possibly earn with the cure), and then distribute the cure to everyone who needs it.
 
spidergoat said:
A US corporation can have it's corporate charter revoked at any time if we feel they are not serving the public interest. For instance, if they start to charge "exorbitant fees" for a lifesaving cure. It would be in the interest of the company to negotiate a fair price. I'm sure that's what they would do.
Click to expand...
A couple of years back, I saw an interview with a representative from one of the major drug companies. I admired his honesty. When asked "How can *any* drug company justify charging 10,000 times cost for a pill that will save someones life?"

His answer:

"We'll charge whatever the traffic will bear"

I feel that more than likely, the drug companies have the government in their control, not the other way around.

They do charge exorbitant fees for many, many life extending drugs. They've always done it, will always continue to do it.

Just try to revoke Johnson and Johnson or Pfizer's corporate charter. Just the mention of it within the halls of *Justice* and you'll find yourself living on a remote island somewhere with Tom Hanks.
 
Listen, if it's a free market, then the federal government can be considered a big customer. Let's say the fed wants to cure everyone, so they negotiate with the drug company to buy the cure. If the drug company wants to make a huge profit (by volume), then they will negotiate a fair price. If they want to make more by selling to individuals, we can just hold up the drug's approval through the FDA.
 
spidergoat said:
Listen, if it's a free market, then the federal government can be considered a big customer. Let's say the fed wants to cure everyone, so they negotiate with the drug company to buy the cure. If the drug company wants to make a huge profit (by volume), then they will negotiate a fair price. If they want to make more by selling to individuals, we can just hold up the drug's approval through the FDA.
Click to expand...
Fair price? Like the ones that are already on the market?

Celebrex 100 mg
Consumer price (100 tablets): $130.27
Cost of general active ingredients: $0.60
Percent markup: 21,712%

Claritin 10 mg
Consumer Price (100 tablets): $215.17
Cost of general active ingredients: $0.71
Percent markup: 30,306%

Keflex 250 mg
Consumer Price (100 tablets): $157.39
Cost of general active ingredients: $1.88
Percent markup: 8,372%

Lipitor 20 mg
Consumer Price (100 tablets): $272.37
Cost of general active ingredients: $5.80
Percent markup: 4,696%

Paxil 20 mg
Consumer price (100 tablets): $220.27
Cost of general active ingredients: $7.60
Percent markup: 2,898%

Prilosec 20 mg
Consumer price (100 tablets): $360.97
Cost of general active ingredients $0.52
Percent markup: 69,417%

Prozac 20 mg
Consumer price (100 tablets) : $247.47
Cost of general active ingredients: $0.11
Percent markup: 224,973%

Xanax 1 mg
Consumer price (100 tablets) : $136.79
Cost of general active ingredients: $0.024
Percent markup: 569,958%

Zestril 20 mg
Consumer price (100 tablets) $89.89
Cost of general active ingredients $3.20
Percent markup: 2,809%
 
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