perfidy

From a WSJ dispatch delivered to my inbox 5 scant minutes ago:

Big Pharma Catches a Chill

Fears that Democrats will tackle drug pricing caused shares of pharmaceutical companies to slide, even as analysts cautioned that Democratic control of the House is unlikely to bring much immediate change for the industry.

My initial thought was "Good". My next thought, really just an amplified version of the first, was "Fuck 'em". But defining "'em" isn't necessarily as easily done as you might think.

A wise reader could intuit that I don't own any pharmaceutical stocks. That wise reader would be wrong, as it turns out. I own shares in Pfizer. But my view of Pfizer or any other pharmaceutical stock is separate from my view of the the economic relationship between the citizens of the US and their drug pushers. There are good companies with bad stocks, and vice versa. I presently like Pfizer's stock, but may not continue to do so. I don't like the industry, however.

If, by some freak of useful government action in the 110th Congress, our legislative overlords were to attempt to remedy the fact that US citizens pay exorbitant prices for drugs, I'd be hugely in favor. Do I think the drug companies make too much money? Nope, not overall. Do I think they make too much money from US citizens? Yep.

Part of that is the fault of some combination of drug company marketing and a peculiarly American desire to do with drugs what others do without. But a meaningful part of the mismatch is an indirect subsidy levied on Americans to pay for rock-bottom prices granted to other countries' citizens. No, it's not done out of the goodness of the drug companies' hearts - they negotiate prices with virtually all of their customers. All, it seems, except those in the US. The fact that they don't generally have to negotiate much at all inside our borders frees them to enter into aggressively negotiated deals elsewhere without shedding too many tears.

If it takes an act of Congress to get the rest of the world to pay the market rate, then so be it. If this results in other countries' citizens paying more for their drugs, then tough shit (though I'm sure there's a drug for that!). And if that market rate, or market resistance to it, has some initial detrimental effect on the drug companies, so also be it. A large component of the differential between US health care spending (as a portion of GDP) and that of the rest of the world is comprised of us paying for their drugs.

I hope the "analysts" referred to in the Wall Street Journal article are wrong. Godspeed, Pharma-bashers.