Tuesday, January 29, 2008

Lots of words today

Here's some sorta shorters about some of 'em.

Go vegan!: If you thought forcing people to buy me humane meat was obnoxious, you're gonna love how big an issue I'll make of going vegan. It'll be especially pleasant when I turn to PETA to prove going vegan makes me an environmentalist.
But remember, the point isn't me making a decision about my diet, it's telling everyone I possibly can about that decision.

Prophets of profit: Is Megan unintentionally trying to make the argument I was too peeved to earlier? Read this

The main obstacle to R&D, then, is not the current state of pharmaceutical industry profits; it is the potential return on the investment in R&D. After all, Merck doesn't have to make drugs; it could generate a nice, safe return of 5% a year in government bonds.
She's utterly blind to what she just said, but there it is. No research without profit. The driving goal is not the betterment of humanity's collective lot, but executive bonuses. If already obscenely rich people don't have the chance to reap huge profits off of saving the lives of others, what's the point in trying?
If you drive down the profits on new drugs too far, it stops making sense to invest in new drugs, even if there is a small profit to be made on current production.


Developing new drugs is very, very risky. Depending on what you think constitutes a drug candidate, somewhere between one in one thousand, and one in ten thousand drug candidates makes it from a lab bench to clinical trials. Each of the failed drugs was very expensive, particularly if it got partway through clinicals, which run about $500 million per course.

The problem is, once you've developed a drug, it's easy to copy. It's also usually trivially cheap to produce.
How the hell do I snark that? How did a human being write it? The problem with drugs designed to heal and save lives is they could too easily benefit everyone who needs them, instead of just those who can afford them at astronomical prices?
I think Megan is genuinely incapable of contemplating the idea that the main problem in our medical system isn't whether it's public or private, but greed.

Why can't we just fund R&D from pharmaceutical advertising budgets?: First, see if you can find a single reason to believe any of the numbers Megan pulls out of her ass in the following
Even if companies could, they won't, for reasons I just explained. But mostly because pharmaceutical advertising budgets aren't really very big. People who think that there is a gigantic pool of capital that could be sucked out of the pharmaceutical advertising budget are being misled by accounting terminology. People who rail against the pharmaceutical industry are fond of noting that about 20% of industry revenues go to marketing, with the implication that this is all wasted on advertising baldness cures during Golden Girls reruns. But just the top ten firms in the pharmaceutical industry took in about $350 billion in revenue in 2007, 20% of which is $70 billion. The entire US expenditure on advertising by all companies in all media forms totaled something like $150 billion in 2007. I know it seems like every other commercial you see is for Botox, but most advertising is not done by pharmaceutical firms.

In fact, advertising is only a small fraction of that marketing expense. Over half of it expense consists of free samples, the offering of which seems to me like an unalloyed public good.
That's the entire post, I put the link in because it's the only goddamned attribution in it.
And to respond to the content, how's about they pay for R&D by accepting lower fucking profit margins in an industry that, at its most basic core, is about saving lives?


spencer said...

And to respond to the content, how's about they pay for R&D by accepting lower fucking profit margins in an industry that, at its most basic core, is about saving lives?

The concept of forgoing a single penny of potential profit is utterly incomprehensible to people like McArdle. Unfortunately, the pharmaceutical industry is apparently filled with people just like her - maximum profits come first, while whatever social benefits happen to accrue are a welcome lagniappe, but nothing more.

Anonymous said...

I got to say, I found this site after reading McArdle's blog and wondering why they had someone at the Atlantic who was so transparently moronic and liable to invoke policy rationales that sound good only in a meeting of the freshman federalist society.

Is it some kind of act? Like, it's a shtick where she tries to come off like a know-nothing jackass?