capitalism and democracy: I could have sworn this was supposed to be about gay boys kissing

[surreul]

As I wonder around the internet while in class I attempt to figure out my views on politics and the world. Generally speaking I hang out at progressive Democrat blogs. I agree with a lot of progressive views. And then we come to the economy

Comments

[ladydaera]

There is nothing wrong with a big company wanting to make money. It is not evil. Neither is marketing.

Now let's talk about big pharma. I'm pretty sure that the vast majority of Americans hate pharmaceutical companies, think drugs are too expensive, and generally believe that the people who work for pharma are evil money-mongering folks. Well, the corporate leaders of pharma companies probably are money-mongering, because you can't be a CEO or CFO of a big company without working hard for that bottom line, but there seems to be an special indignance attached to the behavior of pharma companies. Why is that

[surreul]

hmm. I do think that pharma makes more money that it should. Pharma is an incredibly profitable industry, by some markers it is more profitable then oil is. Pharma companies make up some crazy percentage of the Fortune 500. In a perfectly functioning capitalist society there is no such thing as a really profitable industry in the long term (no need to digress but technically a company should not make 'profits' because everyone's salary, including the CEO is factored in so the ideal profit is 0 which still leaves incentive to work). Of course there is no such thing as a perfectly functioning capitalist society outside economics books.

The thing is the cost of getting the drug to market, FDA approval etc.? That's cost. Costs are factored in before you count profits. So the profit is what they make after costs. Pharma profit percentages get to around 22%. That's crazy. Even taking into account R&D and distribution info structure that's still crazy especially since, as you noted, a lot, a lot, of the actual drug discoveries