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Prescription Drug Companies: A Case Study

Decent Essays
Americans spend more money on prescription drugs than anyone else in other developed countries. The reason is that the drug companies have almost complete control over the price regulation, due to the law passed by Congress that neglected Medicare the ability to be able to negotiate the prices of the drugs, and another generous patent law that allow them to have a long-lasting monopoly. In a recent case, CEO Martin Shkreli hiked the price of a drug that is used to treat life-threatening parasitic infection, a tablet that used to cost $13.50 went up to $750 - an increase of 5,500%. The reason that drug companies give for having such high prices, is that they need to have large profits on the products to be able to continue testing, investigating, producing and to developing, the company stated that a new drug costs about $2.6 billion to develop.…show more content…
Later on, the drug companies are the ones that produce these drugs into sellable products. Ways to be able to stop the rising of such monopolies are introduced by Presidential Democratic candidates Hillary Clinton and Sen. Bernie Sanders proposed to import drugs from Canada, which will allow more competition and will make Medicare to negotiate the price of the drugs, and will also be able to reduce the prices of them. Yet Congress will make efforts to stop such proposal, due to the political influence the drug companies have in the political system. Such problems of price regulation and others related to drug companies are not common in other
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