Medicine and the Magic of the Market

August 28, 2016 at 3:10 pm (Uncategorized)

“I know I’m gonna use good judgement. I haven’t lost my temper in 40 years, but pilgrim you caused a lot of trouble this morning, might have got somebody killed… and somebody oughta belt you in the mouth. But I won’t, I won’t. The hell I won’t”

John Wayne as George W McLintock

And it probably won’t be me either, but I’ll tell you, the next time someone tells me about how the market is the best device for solving problems, I’ll feel those urges welling up.

Now, this particular rant was triggered by a piece I read earlier this week about the epi-pen. For those of you who don’t know, an epi-pen is a medical device designed to deliver a single shot of epinephrine (adrenaline) to someone suffering from anaphylatic shock or a heart attack. The makers of the epi-pen in the US, Mylan, have raised the price from about $100 for 2 in 2007, to about $600 for 2 in 2016.

There are a couple of things worth knowing here.

  1. Mylan has about an 85% share of the market in the US
  2. Mylan made over 1.5B in profit last year
  3. Mylan did not create this product but simply acquired it in 2007, and to the best of my knowledge, it’s selling the same product now as then.

So why did it raise the price so dramatically? Apparently, because it can.  . Now, a short while after the story broke, and various politicians and health advocates howled in protest, Mylan backed down (You know you’re on the wrong side when even even weasels like Martin Shkreli criticize you). The new cost is to be balanced but a complicated system of rebates and vouchers, but it’s interesting to see Mylan CEO Heather Bresch twist herself into pretzel shapes simultaneously trying to justify the rise and also explain how she’s against it. (It’s probably worth noting that Bresch sold $5m in shares the day Mylan’s earning report came out. Even if her MBA is fake, she can see the writing on the wall)

An epi-pen isn’t a vanity item. It’s not like making the choice between buying a $70 pair of Levis and a $1,500 Gucci pair (C’mon, it’s denim for fuck’s sake; how much better can it be?). It’s a potentially life-saving medicine. Or rather, it gives you time to get to hospital. A shot of epinephrine doesn’t nullify the allergic reaction, it merely reverses it temporarily. It gives you time to get to a hospital. That’s why, when people with severe allergies go camping, for example, they often carry two devices, because the effects only last for about 15 minutes.

Now, I’ll confess, there’s a personal angle here. My daughter is allergic to peanuts, sesame, cashews and pistachios. She has carried an epi-pen with her since she was a small child. There have been a couple of situations where she thought she had been exposed to an allergen, but she’s never had to use the epi-pen. I live in Canada, where it turns out, Mylan does not distribute epi-ens. It’s currently, it’s about $125 per pen. Like everyone in Ontario, I have government heath insurance, which…doesn’t cover epi-pens. But, I also have private insurance though my employer, which means the cost is pretty much nothing. Good deal. For me.

Well then, people might say, you’re OK. Except that my access is dependent on employment, which under capitalism is never secure. And many don’t have that access, even in “socialized” Canada. The market certainly provides incentives and is a way to distribute products, good and services alike. But it is the way we want to live? Is it the only way to live? Despite the choices we’re offered in life, I’m going to say “no.”

But, if you believe that medicine should be for those who can afford it. That only the wealthy or those with decent medical plans deserve good teeth, healthcare and access to life-saving drugs, you probably do deserve a belt in the mouth.

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