Thomas Sowell said it best: " Prices are perhaps the most misunderstood thing in economics. Whenever prices are “too high” — whether these are prices of medicines or of gasoline or all sorts of other things — many people think the answer is for the government to force those prices down.
It so happens there is a history of price controls and their consequences in countries around the world, going back literally thousands of years. But most people who advocate price controls are as unaware of, and uninterested in, that history as I was in the law of gravity.
Prices are not just arbitrary numbers plucked out of the air or numbers dependent on whether sellers are “greedy” or not. In the competition of the marketplace, prices are signals that convey underlying realities about relative scarcities and relative costs of production.
Those underlying realities are not changed in the slightest by price controls. You might as well try to deal with someone’s fever by putting the thermometer in cold water to lower the reading.
Costs don’t go away because you refuse to pay them, any more than gravity goes away if you refuse to acknowledge it. You usually pay more in different ways, through taxes as well as prices, and by deterioration in quality when political processes replace economic process."
With that as a context, the upcoming Great Oxford Debate on drug prices seems to frame the issue in ways that go beyond the usual sophmoric level attained by policymakers and pundits...
Medicines and cost: what does GOD think?
UK NEWS | AUGUST 07, 2012
The problem with pharmaceutical policy is that it has become “over-focused to the point of obsession on issues of price and cost”, Professor Richard Sullivan, Director, Institute of Cancer Policy, will argue during the PharmaTimes Great Oxford Debate on 20 September at Oxford University, UK.
Professor Sullivan, who is also a member of the Kings Health Partners Integrated Cancer Centre, will join Eric Low, chief executive of Myeloma UK, and Stephen Whitehead, chief executive of the Association of the British Pharmaceutical Industry, at the prestigious annual debating event to propose that ‘patients have the right to the best medicines, regardless of cost’.
“The argument is not that we should pay whatever a company demands for a licensed medicine irrespective of how little benefit it bestows, rather that value is a much more subtle and complex issue than price alone,” Professor Sullivan says.
However, Professor Sullivan and co will have their work cut out for them as arguing against the motion, will be the Rt Hon Stephen Dorrell, MP, Chairman of the Health Select Committee, Professor Mike Pringle, President Elect of the Royal College of General Practitioners and Laura Weir, Head of Policy & Campaigns, MS Society and Chair, Patients Involved in NICE.
Says Dorrell: “I am strongly in favour of using the NHS budget to secure the best possible outcome for patients, but not in favour of a motion that appears to give treatments based on pharmaceutical products a higher priority than other forms of treatment, nor am I in favour of implying that decisions about healthcare should never be constrained by a real life requirement to decide about priorities.”
But isn’t it society’s moral and ethical duty to ensure that as new medicines are researched and developed they find their way to patients to prolong and improve patients’ wellbeing?
What do you believe? Do patients have the right to the best medicines under the NHS Constitution? If the best medicine is the NICE approved medicine, just what are patients' rights? Are those aged over 65 being discriminated against? Or is it that the NHS simply cannot afford the best medicines?
Join the debate on 20 September at the Oxford Union. For more details and to register your attendance click here or contact Hannah Smith firstname.lastname@example.org or phone 0208 487 9119.