The Discouraging Mylan Epipen Ethics Breakdown

epipen

My economics professor in college was the late John Kenneth Galbraith, a best-selling author, New Frontier favorite and celebrity, to the extent that an economist can be a celebrity. One of the foundations of his fame was his theory that big corporations were becoming the successors to nations. They were, he said, on the way to becoming more powerful than nations, and the working people of the world would begin being more loyal to them than nations or religions.There were a lot of economic and management consequences of this, but it was the ethical implications that most interested me.

Corporate cultures would increasingly steer individual beliefs and behaviors, and strong forces would push these industrial giants to be less driven by profits and more ethically reponsible, since employees would want to be a “citizens” of a corporate state in which they could take pride. Similarly, stockholders wanted to be able to be proud of their holdings, as well as make money with them. His book explaining this theory, “The New Industrial State,” was a sensation. Part of the motive behind the book, my professor being a big government advocate too, was to lay the foundation of the case that these new “states” had to be carefully guided and regulated lest one go rogue and abuse its power to disastrous effect. Still, the position of the book was optimistic: the new giant corporations were scary, but there were forces at work that would make them want to be good and do good while making all that money.

Well, so much for that college course. The unfolding ethics mess that is the Epipen fiasco shows us an ugly company with an unethical culture run by an unethical CEO and invested in by people who don’t give a damn that the company is despicable, as long as they make money. The regulatory system that could have been built on Galbraith’s fantasy has failed utterly.

To make a long, complicated and depressing story shorter, here is a summary with some links at the end.

In 2007, pharmaceutical company Mylan, under CEO Robert Coury, acquired Merck’s $6.7 billion generics business and chose one of his top executives, Heather Bresch, to lead the project of integrating the new products into the Mylan line. Later that year, Coury promoted Bresch to COO.

She immediately focused her attention on the EpiPen, a spring-loaded syringe-like device designed to deliver a measured dose of epinephrine, which instantly reverses  life-threatening reactions to peanuts, bee stings and other allergens. Pushing press releases and public awareness campaigns on the perils of anaphylactic shock, particularly in children, Mylan lobbyists pushed for legislation to force schools to have EpiPens available.

In significant part due to Bresch’s strategy, the FDA changed prescription guidelines from one EpiPen to two. The feds also changed their advice regarding who should have the devices at hand, from patients who had experienced anaphylaxis to “anyone at risk,” whether they’d had a previous episode or not. All of this   doubled the injector’s market size. Bresch also had Mylan lobby for the Generic Drug User Fee Act, which increased FDA scrutiny on Mylan’s foreign competitors. A injection device from Israeli drug giant Teva  stalled in the FDA approval process, and French rival Sanofi was forced to recall its own epinephrine injector.

Thus EpiPen has a near monopoly on injector devices that many literally cannot live without. Since 2007 when a two-pack sold for about $100, Mylan has continually and ruthlessly raised its price. A pack costs more than $600 now. Obviously this creates a financial and health crisis for poorer families and those whose insurance may not cover the EpiPen.

That large a price increase has little to do with Mylan’s manufacturing costs, for the device costs relatively little. The active ingredient, epinephrine, is a generic drug that has been in use for decades, so there are no sunk research and development costs to pay for. Mylan is maximizing its profits, and the public be damned.  It recorded $847 million in net income last year on sales of $9.4 billion, with the EpiPen bringing in $1 billion. Pressed by critics, Bresch, who is now the CEO,  says that she has a duty to stockholders to make money. She has a lot of other rationalizations and spin too, and even a few legitimate justifications to point to, but the unavoidable fact is that this kind of huge price hike…

price-hike

…is best explained by greed.

What happened to Galbraith’s perceived duty of corporations to be a good citizens? At least in the case of Mylan and Bresch, he was imagining it.

It would help, if corporations didn’t  choose leaders who think ethics is some arcane discipline that inexplicably fascinated the ancient Greeks. Heather Bresch is a classic example. Her curriculum vitae says she has an MBA from West Virginia University, but when the Pittsburgh Post-Gazette  contacted the school to verify it, reporters were told that she had attended the program in the late ‘90s but had about half the credits needed for the degree.

Oddly—it may have had something to do with the fact that Bresch’s father now-Senator Joe Manchin, was governor of West Virginia at the time, do you think? Or that  Mylan co-founder and chairman Milan Puskar endowed the school’s stadium and business school’s deanship?—the school suddenly reversed itself, saying they’d made a clerical mistake and Bresch did have an MBA. An investigation by the Post-Gazette and a 95-page report by a special WVU panel  determined she did not, however.

A company cannot and should not rely on someone like Heather Bresch to make ethical decisions, but then a company that hires someone like Bresch isn’t interested in making ethical decisions.

Big corporations need to re-read Galbraith’s optimistic description of how they can be good citizens and still thrive, or capitalism-hating ideologues like Bernie Sanders will get the upper hand, probably proving how a cure can be worse than the disease. Such socialists and managed economy zealots are right about one thing: unless corporations acknowledge their ethics duties to do more than simply make stockholders rich and accept the principle that theics apply to them too beyond a duty to turn a profit, they are too dangerous and ruthless to be trusted.

________________

Sources: Forbes, LA Times, Washington Post, Raw Story, Fox

70 Comments

Filed under Business & Commercial, Character, Citizenship, Ethics Alarms Award Nominee, Government & Politics, Health and Medicine, Marketing and Advertising

70 responses to “The Discouraging Mylan Epipen Ethics Breakdown

  1. Chris Marschner

    As long as professional managers focus on short term profit maximization rather than long term value Galbraiths vision cannot be realized. Boards of Directors drive this behavior in execs by creating performance metrics that reinforce short term thinking. If you eliminate capital gains taxes on securities held more than 5 years and require stock options to vest only after a 10 year holding period then the thing might change .

  2. Assuming (and I do), that it is not unethical for Mylan to have raised the price to some level above previous rates, where does one draw the ethical line on how much of a price increase is both fair to patients and appropriate for shareholders? Does a guideline or ‘best practices,’ for this kind of thing exist? Or is my original assumption wrong, and the price should have remained steady, except perhaps with regards to small increases for inflation and manufacturing?

    • Rate of inflation? Margin maintenance? This is an inexact science at best… Perhaps it’s easier to know what’s not acceptable than give metrics on what is. A 600% inflation over 8 years with minimal (if any) cost increases is hard to justify past “Well some idiots are paying it.”

      • Yes I agree, it certainly is one of those, “I know it when I see it,” type of things. And I believe we know ‘what’ Mylan should have done, especially with such a vital medical commodity as the Epi, as opposed to a luxury item where the sky is the limit. Clearly, the corporate behavior of Mylan and their executive was unethical. Yet my question, which I am by no means qualified to answer, is how much is fair and ethical? And I mean this sincerely and as naive as it sounds, is there a profit spectrum of some sort?

        • The short answer is that there isn’t an answer… Fairness in this context is subjective. As the price rises, more and more people will deem it below their tolerance of acceptability, until it becomes an almost unanimous condemnation… Which is where we’re at here.

          • valkygrrl

            That works with iphones, it works less well with life saving medication. Few people who can scrape together the money are willing to die in order to register their disapproval of business practices.

            • Few people who can scrape together the money are willing to die in order to register their disapproval of politico-industrial practices.

              There, fixed your comment for you.

    • “Assuming (and I do), that it is not unethical for Mylan to have raised the price to some level above previous rates, where does one draw the ethical line on how much of a price increase is both fair to patients and appropriate for shareholders? Does a guideline or ‘best practices,’ for this kind of thing exist? Or is my original assumption wrong, and the price should have remained steady, except perhaps with regards to small increases for inflation and manufacturing?”

      However high the *FREE* Market can bear or the community is willing to pay.

      To bad, as the narrative demonstrates, Mylan effectively stopped the FREE market by using the government to COERCE demand in some areas and SUPPRESS competition in others…

  3. The tendency toward unethical and illegal behavior in completive markets has been extensively researched by William Black, “The Best Way to Rob a Bank is to Own It.” There is a Gresham’s Dynamic at work here where bad behavior drives out good behavior. They would have gotten away with it if, like insulin makers, they had raised the price over a period of time rather then all at once.

    • Meanwhile, in Canada:

      Consumer protection laws have kept the price of Mylan EpiPens to about $120 per pair. The FDA says there’s a difference, but no one seems to know what it is, and it works well enough for us.

      • At what hidden cost and hidden where?

        • (Or better, when will the obvious imbalance manifest?)

        • Maybe the American market is subsidising Canadian devices? I don’t know. I do know that these devices aren’t paid for by our national health care, and my stores sell them at 120 per pair… If you know something I don’t, do tell.

          • No need to subsidize, they can obviously make a profit at $120 per 2. Obviously.

            I imagine the imbalance will manifest when the coerced demand here in the US eats up the available supply at some point in the future and Mylan sure isn’t gonna slough off any to Canada when each one will make several hundred percent more in the USA.

            I’d rather consider the supply available to Canada as being an excess that can’t be sold at 600% mark up so are sent to a discount market to at least get something off of them…

            • I think your question is “When will the obvious imbalance correct itself”? And my answer has to be “When America’s shelf price does”

              At the end of the day, valky actually has a point (just don’t tell her I said so): These prices are ridiculously inflated and once the monopoly on them ends and the FDA approves a competitor, your prices will plummet.

              • You have such faith in our politico-industrial complex…

                I wish I were still optimistic like you.

                • There are about a dozen epinephrine injector producing brands in Europe that would love to come to Canada and sell $1’s worth of artificial adrenaline for $120. I promise you that our price will not raise before yours drops, even if that takes 100 years.

                  • Not sure I ever asserted your price would ever raise as a solution to the “how does the imbalance manifest” question. Pretty sure I did say it would merely mean the Mylan stops supplying Canada because coerced demand in the US eats up supply.

                    • I get what you’re saying…. What I’m saying is that epinephrine is so cheap to produce and lucrative at sale that even if Mylan purposefully ran out to drive demand, there’s about a dozen companies who will literally trip over themselves to fill the void at our current market price.

                    • but yes, in a land where competition is permitted, the crappier competitors will leave the game.

                  • Amusing aside also, if the producers in Europe can get away with getting the materials over to Canada after production, still cut a profit and come in less than $120 per 2, I’d then ask, what’s the hidden cost to Europe, where’s it hidden and when will the imbalance manifest…

                    Nature abhors imbalance, and imbalances always always always manifest, whether now or in 4 decades whether in one painful concentrated burst or spread out over the population…

  4. E2 (nee Elizabeth I)

    Mylan is of course only one corporation — especially but not limited to pharmaceuticals — who use the bottom line to excuse unethical behavior, and behavior that can hurt the very people they presumably are trying to help.

    Take Pfizer, for example. Long one of the best blue chip stocks around — I know, my husband inherited some — and long a respected pharmaceutical, it also was, for quite some time, the leading pharmaceutical doing dedicated research on new antibiotics, especially ones that could combat the new super-bacteria. Pfizer even had its own free-standing antibiotic research facility.

    Alas, it is no more. Pfizer’s CEO and Board shut it down. Despite the fact that it was the only major pharmaceutical dedicating time, money and personnel to this research. (The National Institutes of Health, e.g. has new antibiotic research as number 7 (yes seven!) on its list of priority pharmaceutical research topics, with AIDS, also e.g., ahead, though we all do know a sure-fire way of not getting that disease…).

    The reason: Pfizer admits that this research would never produce the cash cow (not their words) that other new drugs create. Anti-cholesterol drugs, blood thinners and many others are ones that patients use every day, every single day for the rest of their lives after they are first prescribed.. Antibiotics, by contrast, are used perhaps two or three times in a person’s entire lifetime, so not as much money can ever be made from them. The answer: just stop worrying about it! Let the bottom line do the talking, and bacteria-infested hospitals and patients be damned.

    Ethical? No. Dangerous to the very clientele Pfizer exists to serve? Yes.

    I don’t think it necessarily depends on the particular individuals heading up a corporation. It is the bottom-line culture that interferes with ethical behavior, i.e., that forces ethical behavior out of existence. Some corporations seem to manage to strike a balance; others don’t even try, or worse,

  5. As a person that has twice used an EpiPen to save my own life, I’m one of the luck few actual users of the product that doesn’t have to carry them anymore. I think the price increase for the EpiPen is one of the most deplorable acts of extortion directed at a captive audience of vulnerable human beings trying to prevent their own death as I’ve ever seen. Excuses aside; a very specific group of consumers were literally price gouged by a monopoly and they’ve earned all the negative publicity and any fines they are assessed with.

    • Glenn Logan

      It isn’t extortion. It’s profit motive taken to a mindless, dishonorable extreme combined with crony capitalism. Worse, it describes, in graphic detail just how short-term thinking can destroy the reputation of business and provide anecdotal support for the collectivist nonsense embodied in Bernie Sanders’ and Elizabeth Warren’s (among others) rhetoric.

      When we use words like “extortion” to describe simple greed, it reduces the debate to the kind of hyperbole that throws great arguments down into noise, dragging them into the gutter with Sanders and Warren.

      Having said that, the outrage you express is no less justified. The avarice demonstrated by Mylan in the EpiPen matter shocks the conscience. This can be solved simply by removing the onerous regulations in place to thwart competition, the mother’s milk of such embarrassing rapacity.

      • Glenn Logan said, “It isn’t extortion.”

        You’re welcome to your opinion.

        Glenn Logan said, “When we use words like “extortion” to describe simple greed…”

        Glen,
        I really don;t care if you understand this or not; however, this is more, much more, than just “simple greed”! These people knew that they had a captive audience that had no choice but to pay their price or likely DIE! Reducing it to “simple greed” is intellectually dishonest.

        • Glenn Logan

          No, it isn’t dishonest, and no amount of bold or caps will make it so. Extortion is a specifically defined crime, and requires force or threats.

          Despite the usefulness of having EpiPens handy at all times, we have made it through many years before they were available. Plus, they are always available on an emergency basis with ambulances and at immediate care facilities, as well as at most schools.

          Your hyperbole is still exactly that.

          • Glenn Logan said, “No, it isn’t dishonest…”

            You haven’t presented any argument as to why you think it’s not intellectually dishonest. Here it is again, “Reducing it to ‘simple greed’ is intellectually dishonest.” Be specific; why do you think that statement is false?

            Glenn Logan said, “…no amount of bold or caps will make it so”

            Nice little snide remark. Grow up.

            Glenn Logan said, “Extortion is a specifically defined crime, and requires force or threats.”

            I know that.

            So let’s get specific; we have a company telling their customers (with actions) that are literally dependent upon their product to prevent imminent death that they have to pay an exorbitant increase of dollars for their product or take a very real chance of DEATH, is it your argument that that is not a threat that’s either reasonably equal to or worse than someone directly telling you that you either pay them $600 or they’ll break your leg? Pay me what I demand or die; certainly sounds like extortion to me regardless if the message is received directly or indirectly.

            Glenn Logan said, “Despite the usefulness of having EpiPens handy at all times, we have made it through many years before they were available. Plus, they are always available on an emergency basis with ambulances and at immediate care facilities, as well as at most schools.”

            Nice list of rationalizations there Glenn.

            Can someone please identify which of Jacks rationalizations that the statements in the above paragraph falls into?

            Glenn Logan said, “Your hyperbole is still exactly that.”

            That Glenn is a matter of opinion.

            When death is a serious risk to others it may seem like hyperbole to you; however, when death is a serious risk to oneself it no longer seems like hyperbole. Maybe if you have been as close to death as a result of an allergic reaction as some have been, you’d feel a little different.

            I think our conversation is now complete.

            • Glenn Logan

              So let’s get specific; we have a company telling their customers (with actions) that are literally dependent upon their product to prevent imminent death that they have to pay an exorbitant increase of dollars for their product or take a very real chance of DEATH, is it your argument that that is not a threat that’s either reasonably equal to or worse than someone directly telling you that you either pay them $600 or they’ll break your leg? Pay me what I demand or die; certainly sounds like extortion to me regardless if the message is received directly or indirectly.

              It is not a threat. The price is the price. If a cancer or heart patient cannot afford their drugs, it is not extortion. No different here, and there are no threats or coercion involved. You might make an argument for profiteering, but not extortion.

              So given that your argument for extortion is specious, your accusation of intellectual dishonesty is specious as well.

              Now, our conversation is done. You need to stay off the caffeine, Zoltar. Your choler is showing right through your comments.

              • Glenn Logan said, “It is not a threat. The price is the price. If a cancer or heart patient cannot afford their drugs, it is not extortion. No different here, and there are no threats or coercion involved. You might make an argument for profiteering, but not extortion.”

                Looks like we’re just going to have to disagree.

                Glenn Logan said, “So given that your argument for extortion is specious, your accusation of intellectual dishonesty is specious as well.”

                Sorry Glenn, your direct correlation between the two is just plain false. I specifically stated that “reducing it to ‘simple greed’ is intellectually dishonest” I did not say that not agreeing with me about extortion was intellectually dishonest. I suggest you go back and reread what was written.

                Glenn,
                It appears that you don’t like it when your arguments are pointedly challenged. You can shove your snide little remarks.

  6. Patrice

    Socialistic tendencies among otherwise rational liberals/progressives IMNSHO would not have taken hold had we not seen rampaging corporate greed. Finally, because the Mylan case is absurdly extreme, everyone is paying attention to corporate greed. It’s about time.

  7. James Flood

    They could never have charged that amount were it not for their de facto monopoly, created by government regulations. Of course, the usual suspects will call for more regulations (paging Elizabeth Warren) to fix the current regulations, with a mind of future regulations. Lather, rinse, repeat.

    • JutGory

      Exactly, James Flood.

      Who recommended expanding usage of the EpiPen? The Government.
      Who ultimately held out the foreign competitors? The Government.
      Who is recommending that schools keep them on hand? The Government.

      (I seem to recall that Senator Manchin may be involved in some of these efforts, but I can’t find the info offhand.
      How are these schools going to pay for all these new pens? The Government.

      THAT is why the price will be huge. We are back to talking about $600.00 toilet seats. Mylan can easily hand out $500.00 coupons to the public, but the Government pays full-price-because it can. Mylan’s lust for money is only aided by the Government’s lust for power.

      But, you are right. Government sees a problem, Government regulates it away, creating a new problem; Government regulates it away, creating a new problem. We just need to be patient; eventually, a la Rube Goldberg, all the problems will be fixed and the system will work just right.

      -Jut

      • James Flood

        @Jut: “But, you are right. Government sees a problem, Government regulates it away, creating a new problem; Government regulates it away, creating a new problem.”

        Well said. See: Obamacare.

    • valkygrrl

      By government regulations you mean the patent office. You want to reform it? So do I.

      • I don’t understand that comment at all. Federal regulations affect every single aspect of our lives and businesses, our cars, our homes, our recreation. What vague and bizarre point are you trying to make?

      • JutGory

        Valkygrrl,
        As I recall from the first week of law school, the only mention of “rights” in the Constitution (without the amendments) has to do with intellectual property. The drug companies have the protection of the federal government, but liberals hate it.

        -Jut

        • valkygrrl

          It grants them monopolies with the understanding that the public will befit in the long term when those monopolies expire and the innovations are open for anyone to use. Remember the first part of that clause. “To promote the progress of science and the <b<useful arts.”*

          it needs some reform, many patents are granted that shouldn’t be. When it comes to pharmaceuticals the problems come in three main forms. One, monopoly drug prices like with the epipen gouge people. Two, drug combinations get combined into a single pill and a new patent it granted that for some reason denies people the ability to just take the two separate pills. Three, claims that generic drugs made after patent expiration aren’t really the same drug and need a new approval process.

          For the first there’s no solution unless you want to go the price control route, it could be done only for lifesaving drugs and not for mere quality of life pills, like erectile dysfunction drugs but either way it comes down tot he government setting prices and most people don’t like that. For the second, reforms in the patent process would fix that just as it would fix problems in other industries. The third should be simple enough, that’s what labs and people with degrees in organic chemistry are for.

          *Useful arts is 18’th century speak for technology.

          • It could be partially solved with ethical management. A company that spends millions on R and D deserves a patent and deserves time to make back its investment and make a profit. Nothing says they have to engage in gauging. The insurance system allows them to charge more than most people can afford. Without artificial subsidies prices would come down fast. There’s no profit in charging what the market won’t bear.

            I have no idea how to fix the problem, but the reasons for it are obvious.

          • You talk like you have some kind of right to the fruit of other people’s labour. You didn’t invent the EpiPen, the people who use the EpiPen didn’t invent the EpiPen, and it doesn’t grow on trees. And where would the dying people be if the EpiPen hadn’t been invented? Still pretty dead.

            I’m not saying that Mylan’s behaviour was acceptable, I’m just asking you to take a big step back from the commie kool-aide.

            • valkygrrl

              But I do have a right and Mylan agreed the moment they filed a patent application. They made a deal with me and the rest of the human race. In exchange for publishing the details on how the device was made they would have exclusive rights to make it for 20 years, then anyone could do it.

              You don’t pay Thomas Edison a royalty when I use an electric light do you? Do you send a nickel to Gutenberg’s descendants when you print a document? Would we have all our wonderful devices if the basic transistor were still under patent?

              If you invent something, it’s yours…. for a time. Then anyone can make one. And improve it. And use it in part of something better.

              • “I DO have a right to other people’s labour! And they agree that I have that right by agreeing to the extortion that is the American patent system, because if they didn’t sign up for a patent and tried to sell their product, someone else would. Then after extorting them, I will be outraged! OUTRAGED! When they try to gouge what they can when they can, and even more shocked! And appalled! When they try to draw out the time they can do that gouging longer than the time we extorted them into agreeing to. Bastards! Mmm… Good kool-aide.”

                • Patents were always meant to be protection for producers, not a tool for looters.

                  • valkygrrl

                    To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.

                    The purpose is progress, it’s right there in the text, not to help some people make a buck. There’s no reason to protect invention unless the people eventually get something in exchange for that protection. And don’t say they get to buy from the inventor, there’s no requirement to sell, a patent can be used to keep an item from being legally produced at all.

                    • So… Does the entire argument amount to a squabble over dates? That you feel enough time has past that the patent should have expired? That you wouldn’t be this outraged had Mylan simply started gouging earlier?

                      Hypothetical: Had Mylan raised the price of an EpiPen by 600% in 2006, would we not still be having a variant of this conversation?

                    • valkygrrl

                      Probably, since auto-injectors were invented in the 1970s, choosing a specific drug to put into the device isn’t something I would call an invention (the drug itself along with novel refinements to the device can be inventions, of course. But the former isn’t at issue and the latter shouldn’t prevent others from selling the same drug in an older model auto-injector) If you mean had it been an all-new thing then no, the question would merely been the one of ethics that Jack presented.

                      And I thought you withdrew leaving me in possession of the field.

                    • “Hypothetical: Had Mylan raised the price of an EpiPen by 600% in 2006, would we not still be having a variant of this conversation?”

                      “Probably, since auto-injectors were invented in the 1970s”

                      *snort* Ok then:

                      Hypothetical: Had Mylan raised the price of an EpiPen by 600% in 1990, would we not still be having a variant of this conversation?

                      And please don’t say “No, because then you’d be 5.”

                      My point is that you’re using the time of the copyright as a cop out, I think you’d be outraged over this regardless of the time frame. We can have that discussion, but let’s at least be honest.

                • valkygrrl

                  First you brag about the Canadian system forcing them to sell at a lower price than they’d wish and now complain that people who wish an exemption from having to sell in a free market are being extorted.

                  • And that folks, is how you deflect an entire conversation and move the goalposts! Don’t worry, I’ll just mark that a W, and move on to this other conversation.

                    Canada’s system is deeply flawed. It’s still better than America’s because even though it’s flawed, it functions. America seems fundamentally unable to do anything right, and has for most of my adult life. You want a free market? Have a free market! You want a socialist system? Have a socialist system! But these strange half-assed compromises that seem to be the only way your government knows how to operate are expensive, ineffective and are a success only if you’re a hack or a bureaucrat looking for job security.

                    • To be clear, I don’t think she moved the goalposts, but I think (I’m still analyzing it) that she committed the ever-elusive ACTUAL instance of an ad hominem.

      • That’s probably not what they mean… Or at the best a very small part of what they mean. And I think you know it.

        One of the most insidious classes of government regulations are barriers to entry. There was a time where a person could just say they started a business, and it was true…. But we’ve reached a point in our bureaucracy where kids lemonade stands get shut down for lack of a business licence and FDA violations.

  8. Wayne B

    Here’s something interesting I found on John Kenneth Galbraith the “New Dealer” on William F Buckley’s show *The Firing Line*: https://www.youtube.com/watch?v=LkqOXUJoKkM

  9. zoebrain

    “Such socialists and managed economy zealots are right about one thing: unless corporations acknowledge their ethics duties to do more than simply make stockholders rich and accept the principle that theics apply to them too beyond a duty to turn a profit, they are too dangerous and ruthless to be trusted.”

    Hopefully I’m not a Zealot of any kind. As for Socialist? Perhaps in a 19th century sense, certainly not in the 20th century sense.

    Managed economy? Nope, regulated just enough so there’s a Free Market, rather than one that has degenerated into Monopolies, natural as well as artificial.

    From my blog in 2013
    http://aebrain.blogspot.com.au/2013/12/the-failure-of-trickle-down-economics.html

    I used to be a great believer in “trickle-down”. Up until 1980, there was evidence that it always worked. This evidence couldn’t be ignored.

    However, I did not foresee that there was a tipping-point in the concentration of wealth where it made far more economic sense to buy the government than to invest in plant.

    This means that regulations which restrain monopolistic and anti-competitive practices are repealed or not enforced, while ever more burdensome regulations that strangle upstart competitors at birth are enacted. The more of the latter there are, the more persuasive the argument to relax regulations against the big boys. The more the big boys get away with murder, the more persuasive the argument for regulations and yet more regulations that only affect the small end of town in practice.

    Trickle-down cannot help but grow an economy in an absolute sense; but when the distribution is too concentrated, most of the growth ends up in the hands of a very few, while the median standard stays steady, growing very slowly. In pathological cases, not just all the growth, but over 100% of it ends up in the hands of those who control the legislatures, and the median standard actually falls, as in the USA today.

    This leads to a runaway effect, where 1% of the populace holds more national wealth than the rest of the country put together. The US hasn’t reached that state yet, but it’s 40% in 2013, and likely to hit over 50% soon, with 60, 70, 80% to come. The trend is clear, the concentration accelerating.

    The result ‘ “too big to fail, too big to jail” is already visible. Disrupting the system by putting the brakes on would cause economic chaos, hence the need for bailouts and ever increasing corporate welfare. There are already commercial organisations essentially immune from legal sanction. Examples of CEOs paying less tax in absolute terms than their secretaries, and ridiculously less in relative terms, abound.

    That’s the diagnosis. The cure? Er… pass.

    • valkygrrl

      That’s the diagnosis. The cure? Er… pass.

      Monarchy. The wealth concentrates and with it the power but no one controls all the means of their production so they need to work with others or war with them. War gets expensive so they will need to be the prince, or , I guess, in this case, dodge to manage the rest.

      Then a Robespierre or a George Washington comes along and we do it all again. Weeeeeeeeeee

  10. So what stopped other people from manufacturing and selling products that could substitute for the Epi-Pen?

    • valkygrrl

      A government-enforced monopoly known as patents.

      • Question posed by Michael Ejercito was, “So what stopped other people from manufacturing and selling products that could substitute for the Epi-Pen?”

        Answer provided by valkygrrl was, “A government-enforced monopoly known as patents.”

        The following is based on my understanding that the actual drug (Epinephrine) is not covered under a patent only the auto-injector method of delivery is covered under a patent.

        The correct answer to Michael Ejercito’s question is actually “nothing”; however, the answer provided by valkygrrl is narrowly focused and ONLY true in a case where the delivery method infringes on the patent (even then deals can sometimes be worked out with patent holders to produce the idea in the patent and share the profits) and is most certainly NOT TRUE in all other cases! Valkygrrl doesn’t understand Patent Law; substitute does not only mean things that infringe on the patent, it does mean any substitute method of delivery which includes any methods that infringe on the patent but is not limited to methods that infringe on the patent. In fact a simple syringe filled with the proper dose of the product that can be administered by hand does not infringe on the auto-injector patent and serves as an adequate method of delivery and the rights to a simple syringe is not limited to a patent holder.

        I’ve been on both sides of patents; my name is on a patent and I have had to enforce that patent against others trying to infringe its contents, and I’ve been directly involved with a company that was on the receiving end of a patent infringement claim. This is very detailed and very complicated law.

        Usually patents give the owner(s) enough time to recover research and development costs and time to try and to develop a market for the idea. Patented items usually start out more expensive than you might expect at first but, over time, as demand increases (hopefully) and efficiencies in producing the idea have been addressed, the idea ends up decreasing in cost and that cost reduction is passed on to the idea consumers before the patent expires and the patent owner has to compete on the open market with other manufacturers that have had ZERO investment in the research and development and ZERO investment in creating/growing the market. My understanding of what has happened with the EpiPen is this is the opposite of what usually takes place and there has been intentional price gouging of a very captive group of consumers.

        Your patent “monopoly” is legal protection against invention chasing producers/manufacturers stealing unique inventions from others, making products based on those inventions, and illegally profiting from intellectual property that they stole. My intellectual property (my invention) is none of your damn business and not available for you to profit from regardless of what the invention is; think your own thoughts and produce your own products but you have absolutely no damn “right” to do whatever the hell you want to do with mine and I have absolutely no damn right to do whatever the hell I want to do with yours.

        Finally; just because some unethical company has chosen to abuse their legal patent rights and literally gouge a captive audience (I call this case extortion) does not give you the intellectual ammunition to smear all patent holders as greedy monopoly, intellectual hording, unethical human beings. As far as I’m concerned valkygrrl, you can shove your patent “monopoly” BS right where the sun doesn’t shine.

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