Sunday, January 31, 2010

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(When you cant see the man behind the curtain.) I was watching the news and one of our Congressman was going off on how the drug companies are behind the high cost of medications and how they are so much cheaper overseas. (Part of the Progressives view that all corporations are bad!) Anyway, I thought about it and did a little checking. When we go on our medical missions we stock up on meds. I can get 1000 Cipro tabs for $24 from a medical wholesaler. I then got on the phone to Walgreens and they told me 20 would be $16. I then ran a bunch of common meds, propranolol, amoxicillin, predni sone. It was all the same, the mark-up at the pharmacy was enormous! I tried some brand names that were not generic, and guess what, it was the same!

I found out the only reason I could buy the meds from the wholesaler was my medical license but I could not be a distributing pharmacy. You see here in the US, a patient can only get medications from a distributing pharmacy which can mark up the price as much as the market can bear. The big pharmacy chains can be their own wholesalers and also negotiate with each insurance company a cost for each medication. As a a result of this their proffit goes through the roof.

There is a reason why there are pharmacies on every corner and why drugs cost so much. It isnt so much the drug companies but the pharmacies. (When you get meds from Canada you get them from wholesalers). So, ignore the man behind the screen at the pharmacy because he is robbing you blind.

3 comments:

Andrew_M_Garland said...

An analogy:
Say you have already trained a doctor. The doctor can be well fed and rested in a modest home for about $40,000 per year. Paying anything above that can be blamed on the greed of the doctor.

This is silly, of course (but frighteningly close to Liberal Economics).

The price of something is determined by demand, capital costs, litigation risk, and regulation, among other factors. The small cost of some material (the drug) doesn't make the pharmacy greedy, especially when there is competition on every corner.

It does beg for examination of what is making it so costly to distribute drugs. My guess is the costs of regulation, the control of drug distribution through costly, highly trained professionals, and the capital needs of having a physical pharmacy building.

So, we could dramatically lower the final cost of drugs by allowing mail-order delivery, without liability on the distributors. I am open to the argument that this would injure or kill many people who need the services of everyone in the middle. I personally would like the more minimal system.

SeaSpray said...

I didn't know that. I assumed drug companies too with some profit mark up after drug co cut.

I am glad we have a health ins plan and it can still be expensive. I wonder why the ins drug co as middleman operates so much more cheaply?

This would be something to be addressed in health care reform... but then how can you deny someone the right to make a profit?

SeaSpray said...

Also Throckmorton ..you mention medical missions and I see that Mercy Doc on your side bar. I remember you said you went to help Katrina victims and you've mentioned 3rd world countries.

Are you planning to set a site up with pics sometime? I think that would be really cool ..to see pics and read your stories ..obviously allowing for confidentiality.

What rewarding work!