Europe’s Beleaguered Drug Companies
This article is republished in its entirety from Andrew Sullivan.
I’m sorry to burst Kevin Drum’s bubble, but the pharmaceutical companies in Europe have been in difficulties for quite a while now, under the burden of the socialism he favors for the U.S. healthcare industry. According to the industry’s own website, as long ago as 1994, the European Commission Report on Europe’s ailing drug industry said the following:
“Europe as a whole is lagging behind in its ability to generate, organise, and sustain innovation processes that are increasingly expensive and organisationally complex”. The report underlines that the pharmaceutical market in Europe has been negatively affected by significant, excessive and uncoordinated government intervention that stifles competition and discourages innovation. This also creates significant inequity among European patients’ rights to access of medicines.
Socialism fails. Always has. Always will. And the toll in Europe in so many areas is clear. Here’s what socialized medical systems have done to European pharmaceutical research:
• For over 100 years, Europe has been a powerhouse of pharmaceutical progress and innovation. Over the last decade, however, Europe has gradually lost its leadership in the pharmaceutical sector, with a steady transfer of its R&D to the US - where policies and market conditions are more favourable to pharmaceutical innovation.
• Key benchmarking indicators show that between 1990 and 2002, R&D investment in United States rose more than fivefold, while in Europe it only grew 2.5 times.
• In 1990, major European research-based companies spent 73% of their worldwide R&D expenditure on the EU territory. In 1999, they spent only 59% on the EU territory. The USA was the main beneficiary of this transfer of R&D activity.
America is the last refuge for pharmaceutical innovation. And the left wants to kill that off. There’s more evidence of what socialism does to healthcare R&D in Europe:
• The latest data on new molecular entities (period 2001-2005) show the predominance of the US which has now become the leading inventor of new molecules in the world (61 against 51 for Europe)
• The top 20 companies worldwide shows the leadership of US companies. In 2005, nine (9) of the top 20 pharmaceutical companies in the world are of American origin (against 8 for Europe).
• US companies significantly increased their share in the world’s top selling medicines. On the top 30 worldwide products in 2005, 21 originate from the US against 8 from Europe.
• US companies are more successful in disseminating their new medicines at international level: 70% of the sales of new medicines launched on the world markets during the period 1998-2002 were made in the US, compared to only 18 % in Europe.
• Whereas the European pharmaceutical market was still the world’s largest market in 1990 (representing 37.8% of the world market), it now only represents 30% of the world market (compared to 47 % for the North American market).
This is what the left wants to do to pharmaceutical research in the US as well. There’s a case for it: the usual leftist case for nominal equality over quality and progress. They’re not being honest about it. They need to be.
Comments
You’re saying the same crap in every thread. If you cannot converse like an adult, you aren’t welcome. As for your stupid insult about “people agreeing” with me, You don’t seem to notice other people disagreeing with us and yet still managing to maintain a basic level of intelligence and adult discourse.
Just like you refuse to notice that there have been like, four fat jokes out of near 40 posts in the recent weeks.
I’m not going to be patient with you for much longer. Either learn to communicate like an adult (and that means READING and COMPREHENDING and not repeating yourself in every thread just to start trouble) or go start your shit somewhere else.
Bye Bye Bobbyjoe, you fucking moron
BJ, you obviously don’t read. Jim would have paid for his own wife’s medical needs; he didn’t need the help, but he appreciates it. That point’s been said… I don’t know… 100 times?
while reading the original post I had a thought. In the past 10 to 20 years there have been numerous European companies that were bought out by American companies...I wonder how much of the transfer of research dollars has had to do with the fact that the companies are actually American companies now instead of European?
So what is the purpose of health research to make money or to help people?
Bobbyjoe, why do you feel those are mutually exclusive? Are you that unfamiliar with the market? Do you seriously believe that pharmaceuticals are only concerned with “trivial” problems like hard-ons and hair, or are you being glib because you’re unaware of the breadth of health industry research?
It costs money to do proper research. We don’t want a Chinese toothpaste crisis with cancer drugs, do we?
Posted by bobbyjoe on 06/28/2007 at 04:56 PM (Link to this comment | )
Both… it makes money by providing things to people that help them… Re: people want to buy the products because they are a rational decision… because they help them…Is the pharmacutical industry there to help people or make money?
Even if the pharmacutical companies wanted to provide lifesaving drugs to the world’s population, there are still ALOT of cost involved in the development of these drugs. Who pays the bill?
Does the chemist who finds the key to a breakthrough deserve a decent salary? How does his lab make money to pay his salary? Who pays for all the testing? The equipment and human expenses? As much as the chemist wants to find a cure for cancer, he/she still has to feed their family, pay the mortgage, etc.
You know what pays for all that? SALES PROFITS.
Study some economics. It appears as though this is a forgotten subject/concept in the US, as well as the rest of the world (i.e. Europe).
PROFIT...what makes the capitalist world go round. I do not have anything against a company that can make a profit. And Research cost lots of money...the company has to recover the cost of researching a drug before it can earn a profit on that drug.... only problem I have with the drug companies is why the same drug sells for less in most countries than it does in the USA?
About $24 billion a year is spent by OUR government for disease research. This program is funded by tax revenue through the NIH. The money goes to research facilities around the country . . . mainly universities with research hospitals.So what is the purpose of health research to make money or to help people?
About $24 billion a year is spent by the top 10 U.S. pharmaceutical companies on developing new drugs based the research provided by funds from OUR government through the NIH.
The reason those pharmaceutical companies exist is to make a profit. It takes massive amounts of capital to fund the start up of a pharmaceutical company. That means it takes a whole lot of investors willing to take a risk that they will never see a dime of their money again. Investors don’t accept risk just to break even. They hope to get a return on their investment.
And how does a pharmaceutical company make their profits? The old fashioned way, by providing goods and services that satisfy customer demand.
And how many people are happy with our pharmaceutical companies? Well, some say people vote with their dollars.
Some people just cannot grasp the concept of mutual interest. It just goes right over their narrow little heads. They labor under the fallacy that if you win, they lose. And people with that attitude usually lose.
No doubt, bobbyjoe comes from the “obscene profit” faction of Moore’s legions. I’m still wondering what an obscene profit is. I also wonder if there are G profits, PG-13 profits, R profits, etc. One thing I do know . . . Moore will never define the term.
Maybe obscene profits are what the pharmaceuticals make off Americans to recover their R&D;expense while they sell Canadians the same drug making only a G profit. One things for sure . . . some of that $24 billion a year the NIH gets from our tax revenue ought to come out of foreign pockets.
I just don’t know why the Euros are so sick, since they eschew McDonalds and big cars.
I just don’t know why the Euros are so sick, since they eschew McDonalds and big cars.
Perhaps it’s all the tobacco they haven’t eschewed.
They worry themselves sick over our lacking free health care
I’ve added some questions to the discussion. If all you want to hear are people agreeing with you then feel free to ban me and continue in your little world.
Self righteous and a martyr, what a suprise there.
For a guy who couldn’t pay to save his own wife it seems strange that you don’t support nationalised health care.
And then he shows his true colors. Self righteous, a martyr complex and ignorant, he’d make the perfect homicide bomber.
Of course, “obscene” or “X” rated profits are OK if you are a “documentarian” er “man of the people”.....er......
Posted by MgmLneWolf on 06/28/2007 at 09:00 PM (Link to this comment | )
PROFIT...what makes the capitalist world go round. I do not have anything against a company that can make a profit. And Research cost lots of money...the company has to recover the cost of researching a drug before it can earn a profit on that drug.... only problem I have with the drug companies is why the same drug sells for less in most countries than it does in the USA?
Theft and envy make the socialist world go round and the threat of refusing to honor drug patens, by the other countries, is why the drug makers have knuckled under and given them unfairly low prices… Humanitarian discounts for those who can’t afford it aside....
I’d love the US government to go after the drug companies for charging different prices for Europe and Canada… In the hopes they’d have to fight it out with them to get them to pay their fair share (which in turn would lower our prices some)… with things like the WTO they’d have a good chance of winning.. it would just be messy.
I’d love the US government to go after the drug companies for charging different prices for Europe and Canada… In the hopes they’d have to fight it out with them to get them to pay their fair share (which in turn would lower our prices some)… with things like the WTO they’d have a good chance of winning.. it would just be messy.
I wonder though, sl0re. If big pharmaceuticals were forced to charge foreign governments more for drugs, then some of those countries might not honor drug patents since they could easily duplicate the chemistry making their own versions. Of course, that might set off a patent war, but supposedly there’s a legal remedy for that.
The other option is through diplomatic channels, but the majority of larger countries with socialized systems already have more financial problems with their health care systems than they can’t handle. In the end, as usual, we end up financing other countries.
I wonder if Medicare negotiates with foreign drug companies for lower prices? If not, maybe we should because the number of people on Medicare will soon exceed the population of some foreign countries with pharmaceutical industries.
The real point is if Americans spend 40-something billion bucks on R&D;via taxes to fund the NIH and paying higher drug prices, then what are we getting in return? If I lived in Europe, instead of criticizing our system, I’d be hoping Americans opt for staying privatized.
Posted by Buzz on 06/29/2007 at 03:00 PM (Link to this comment | )
I wonder though, sl0re. If big pharmaceuticals were forced to charge foreign governments more for drugs, then some of those countries might not honor drug patents since they could easily duplicate the chemistry making their own versions. Of course, that might set off a patent war, but supposedly there’s a legal remedy for that.
I think that if the US government were on board, they would probably win. We could go to the WTO and fight it out. In a couple years it would be resolved. Without government support, I see why the pharm industry feels intimidated.
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bobbyjoe, do you have anything to add to the discussion? If you insist on billboarding with the same commentary in every thread you will be banned. Please recall the TOS you agreed to when you signed up.