Some older relatives of mine struggled to get the COVID vaccine. No matter how many hours they spent on the phone, trying to set up appointments with the county government, the answer was always the same: "All our vaccines are gone now. Try again next time."
Kind of like standing in a Soviet breadline.
Then the grocery store down the street rushed in to help. They emailed us to report, “I called yesterday and made appointments for this morning. We're slightly sore, but very happy.”
Like going through a drive-through at McDonald’s.
Despite the success of the free market – under appropriate, limited regulatory guidance from the government – in creating just about every medical advancement of the last 100 years, there are an increasing number of people who think the government should seize complete control of our health care system. All of them won’t come out and say that all at once, but inch by inch, bite by bite, every intrusion of government control on free-market health care moves us in that direction.
The latest example of this is House Speaker Nancy Pelosi’s HR 3, the innocently titled Lower Drug Costs Now Act. Billed as the silver bullet that will hit the bullseyes of all our health care woes, it seems more like shooting the US health care system in the foot.
The bill would slap a preposterous tax on prescription medicine, so that if a drug manufacturer refuses to enter negotiations with the Health and Human Services secretary on a “a maximum fair price,” HHS would hit it with an excise tax equal to 95 percent of annual gross sales. So, if a company sells a drug for $100, they would owe $75 in tax – even if the drug cost $85 to make.
This means that the Pelosi prescription tax – or prescription penalty – could easily surpass 100 percent of profits.
This steep penalty coerces drug manufacturers to negotiate and abide by the final price, with the goal of ensuring patients enjoy uninterrupted access to the necessary medicines. Now, if HR3 were to become a law, it would bankrupt drug manufacturers – thereby interrupting patients’ access to necessary medicines.
No rational-thinking person could ever accept this immodest proposal, which is why the propaganda campaign behind it will use soaring emotional rhetoric instead. But, in the interest of reason winning out the day, these economists calculated how much damage would have been done to our health and wealth had HR 3 been passed in 2011.
They found that the biopharmaceutical companies that would be affected by price setting under HR3, over the last 10 years, invested $300 billion in small, emerging biotech companies, resulting in 64 new medicines.
The massive reduction in industry revenues under HR3 would have an outsized effect on industry deals with small biotech companies – as regulation always hurts small businesses most – forcing capital away from riskier investments and into something more reliable, like say, new flavors of Doritos.
The United States is the only part of the world that reliably creates new medicine: 70 percent of global biotech IP is owned and developed in the U.S., because market opportunity is so tight almost everywhere else. Not only is this great for people who need the life-saving medicine of the future, but it’s contributed to remarkable growth in R&D employment, with 100 percent growth in Massachusetts and Speaker Pelosi’s own California.
If HR3 gets through, it will devastate that industry and cripple R&D. People like Pelosi and her minions spend so much time attacking the United States it seems like they don’t realize how dependent the world is on its economic power and rule of law.
In the near term, HR3 would have killed the coronavirus vaccine.
Operation Warp Speed was a massive success for both the outgoing Trump administration and the private drug companies behind it, proving to have been arguably the most successful medical public-private partnership of all time. Even NPR has to admit that. Since vaccine distribution began in December, more than 95.7 million doses have been administered nationwide, reaching almost 19 percent of the total U.S. population – including the older relatives mentioned above – according to the Centers for Disease Control and Prevention. Currently more than 2.1 million shots are being given a day.
And this is in less than one year of R&D!
In our hyper-interconnected world, a virus like COVID-19 could go global at any time. The cures of the future will come from the United States – unless the Democrats have their way.
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