12/13/2009

The amendment that may kill the health care bill

Allowing people to re-import drugs will destroy the incentive to engage in pharmaceutical research, but the amendment here could kill the health care bill and prevent drug re-importation from occurring.

Politico reports: "Senate Democratic leaders are blaming Republicans for the hold up, but insiders argue that those leaders are trying to figure out how to give Democratic Sen. Byron Dorgan (N.D.) a vote on his amendment without busting the carefully crafted and fiercely protected deal between drug companies and the White House. Some Democrats worry that a broken [Pharmaceutical Research and Manufacturers of America] agreement could send health reform completely off the rails." "[The pharmaceutical] industry support is considered a key to passage," the Los Angeles Times claims. The AP notes: "Some participants on both sides concede it will be difficult for Dorgan to win the 60 votes he needs."

UPDATE: More bad news for the government takeover of health care.

Risking the wrath of Democrats, Sen. Joseph Lieberman, I-Conn., threatened Sunday to join Republicans in opposing health care legislation if it permits uninsured individuals as young to 55 to purchase Medicare coverage.

Lieberman, whose vote is critical to the bill's prospects, expressed his opposition twice during the day: first in an interview with CBS, and more strongly later, according to Democratic officials, in a private meeting with Senate Majority Leader Harry Reid.

Reid, who is hoping to pass the legislation by Christmas, needs 60 votes to overcome Republican objections, and has been counting on Lieberman to provide one. . . .

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3 Comments:

Blogger James D. Miller said...

"Allowing people to re-import drugs will destroy the incentive to engage in pharmaceutical research, but the amendment here could kill the health care bill and prevent drug re-importation from occurring."

Why - wouldn't drug makers just respond by not selling cheap drugs to nations that allowed their products to be exported to the U.S?

12/13/2009 3:55 PM  
Blogger Proof said...

It's my belief that if there were a large scale re-importation of drugs from Canada, the first thing that would happen is that costs would go up on Canadian drugs.
US firms can increase market share by shipping drugs to Canada at reduced rates, where costs (read: litigation) are lower.

If those same drugs were to cross the border and subject them to the same liabilities as other drugs in the US market, I believe that the first thing the pharmaceutical companies would do, is raise prices to a level more commensurate with US sales.

The only thing large scale re-importation will do is screw the Canadians.

12/13/2009 4:58 PM  
Blogger John Lott said...

Hello, Jim, it is great to hear from you. The answer to your question is "no." Take Canada. If pharmaceutical companies don't accept the price that the Canadian government is willing to pay for a drug, they can't sell their drug there. Under World Trade Organization rules, if their drugs aren't sold in Canada within two years after they are sold in the US, the company loses its patent and Canadian companies can copy the drug -- leaving the company that created it with absolutely nothing. Of course, the problem is even worse than that because the generic version of the drug would leak into the US.

12/13/2009 11:41 PM  

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