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GlaxoSmithKline to pay $3bn in US drug fraud scandal


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#16 Jase

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Posted 03 July 2012 - 10:33 AM

probably because there's so much money tied up in research and testing. that part is expensive because, despite what venom tells you, the government doesn't want drugs to hit the market that promise to cure the flu but actually cure you of the ability to walk. these companies have to recoup their losses somehow

the real crime is all of the money spent on advertising and bonuses for execs


Despite pharma-sponsored studies suggesting that a new drug costs close to 1.2 billion dollars, in truth, the average drug approved by the FDA has had only $71 million in R&D funding. But then, over 90% of new drugs have no new ingredients except for those in drugs with patents set to expire.

Look at the Bayh-Dole act, and the Hatch Waxman act. Under the provisions in Baye-Dole, the government actually pays big pharma over $20 billion a year in grants for R&D.

So in summary:

1) we handpick the biggest companies for R&D
2) We fund this R&D with public money and don't expect anything back on our investment
3) We give them exclusivity to market their products competition free for a time period. Then when the time period expires, they just change the drug slightly and submit it for re-approval.
4) we wonder why free market forces don't work in the pharmaceutical industry in regulating profit.


Sweetheart deal if I ever heard one.

#17 cantrell

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Posted 03 July 2012 - 10:40 AM

i'm not disputing that it's fuged, as i mentioned outrageous exec pay and money wasted on advertising. i'm disputing the notion that a move toward the glorious free market is any kind of solution

how about the government contracts the research out (grants, whatever) and, when new medicine is discovered, the government holds the patent? i mean apparently we're already subsidizing research and we're still coming up with new medicines so that part must work. the government can then either auction off the patent if you dig the corporatist government we currently have, or it contracts distribution out and remains revenue neutral so we all have cheap medicine if you want to entertain the thought of a more leftist alternative?

#18 Jase

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Posted 03 July 2012 - 10:45 AM

i'm not disputing that it's fuged, as i mentioned outrageous exec pay and money wasted on advertising. i'm disputing the notion that a move toward the glorious free market is any kind of solution

how about the government contracts the research out (grants, whatever) and, when new medicine is discovered, the government holds the patent? i mean apparently we're already subsidizing research and we're still coming up with new medicines so that part must work. the government can then either auction off the patent if you dig the corporatist government we currently have, or it contracts distribution out and remains revenue neutral so we all have cheap medicine if you want to entertain the thought of a more leftist alternative?


Those sound like good ideas to me. I don't think we'll ever see it come to fruition, though, until we go single payer and suddenly the govt is footing the bill for $600/bottle arthritis meds.

I definitely think that if the government pays for the R&D, they should either get a cut of the profits or ownership of the patent.

Personally I think the big pharmaceutical companies have enough slush and don't need government grants to begin with.

#19 thatlookseasy

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Posted 03 July 2012 - 10:46 AM

That's not it at all. The biggest pharmaceutical companies stave off nimbler competitors because they have legislation written especially for them to maintain 'legal monopolies' for their respective products.

Government/Pharmaceutical collusion is one of the most disgusting things about our government.


Well its not necessarily all thanks to the government, but pharmaceutical companies have government interference where they want it and a free market approach when it is to their advantage. There is little to no oversight or disincentive for drug companies to do things like bribe doctors and advertise prescription drugs on TV, both of which do nothing to help the consumer and only serve to raise the costs of drugs