I've always been pro-socialized Health Care - I believe that the net-public good (which cannot be measured) outweighs the net cost. Or to put it a different way:
Having lots of healthy people able to work to the maximum of their ability creates enough surplus wealth that we can afford to keep them healthy.
Now, charging for Medicines - that's a different question.
In terms of the likes of Pharmac - it's certainly true that purchasing for an entire Country means that you are buying in Volumes that enable you to negotiate the best Price. It also means that for the Supplier - the Buyer is less likely to go bankrupt or 'go out of business', so it's a very secure revenue stream.
So, for the majority of situations, it works great. Where a Pharmac type system fails is every other year or so, we get a news story about someone who has a rare condition and needs some expensive drug that Pharmac doesn't fund or that Pharmac doesn't have the Budget for or Pharmac isn't convinced of the efficiency of the drug.
The question of Pricing Medicine, that's a different question (I'm sure someone is going to mention the guy that bought the company and then jacked the price up by like 1000%).
I'm going to split my answer into 2 parts - the R&D side and the per-unit cost to manufacture.
The per-unit cost is the simpler one to address - If we go with Paracetamol (as an example) and I setup a new company to make it (maybe with a new way manufacturing it), it's reasonable to say that the price should be something like cost+X% (so 50% markup for example is reasonable - always gotta double your money).
R&D however is a different beast - I believe that the cost of the Covid Vaccine was around $6 Billion. How do you price for that? And more importantly - how do you price for the next big research project?
Certainly I believe that those that are first to market deserve a Competitive Edge and I also believe that the Price should be such that for the estimated number of units sold, not only is the research cost accounted for, but there should be a percentage to fund future endeavors.
To use a crude example - Imagine a disease that only affects one person on the entire planet, but the cost to develop the cure is $1 Billion, it would be right that the cost for that single shot of medicine to be more than $1 Billion.
Now, let's assume that said disease is Fatal, you might say 'well, it's a single Dose, so just give it to them' - but that denies all the other research on other fatal diseases that could have been done for that $1 billion.
The flipside is that the government confiscates your research and forces you to manufacture the drug for free - we'd call that Slavery.
Or, they simple confiscate the research and let other people make it, thus disincentivizing anyone else from spending all the time and effort to innovate, leading to an inevitable decline - we'd call that the Soviet Union
.
TL;DR - Life isn't fair. If coming up with life saving drugs was easy, everyone would be doing it - but the reality is, it's very hard to do and so we incentivize the people that do it to do so in the form of giving them resources.
Bookmarks