According to the New York Times, the cost of EpiPens has risen from $57 in 2007 to over $600 for a pack of two in 2016. EpiPens are vital to the safety of those who have life-threatening allergies to things such as bees or peanuts and it is recommended that their EpiPens be replaced every year. People with a need for EpiPens must find a way to pay the $600 for them when they expire each year. The dramatic increase in price is due to the monopoly that EpiPen has over the industry of epinephrine. After a company creates a unique drug, it is issued a patent that prevents any other sellers from entering the industry, giving the single company the power to charge whatever price that they see fit. Patents give pharmaceutical companies monopolies
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These obscene prices have sparked a massive protest from people who rely on this medicinal product to survive. The increase in price has made it harder for many to afford so many have demanded a decrease in price. However, the company argues that since they made the product, they should be allowed to sell their product for whatever price they decide on.
Pros of Patenting (Megan): Medical drug prices are affected greatly by the existence of patents. Many economists support the phenomenon of patenting drugs due to the benefits that patents have in the field of medicine and the drawbacks that can exist when they are not used. For example, patents are crucial to the research and development of new drugs. For a company to get a drug to the market, they must go through a very challenging, time-consuming, and tedious process of attempting to discover and produce a new drug. This task includes numerous failures and even if a new drug is discovered, it is not always approved for distribution in the market. It often takes up to twenty years to complete …show more content…
Economists from this school of thought believe that drug patenting is unfair to consumers as patenting creates a monopoly. Big corporations claim intellectual property of the products through a patent and are given the authority to produce this drug. “A drug company that holds patents on a medicine has the right to prevent others from manufacturing it “ (“The Impact of Patents on Access to Medicines”). Therefore, pharmaceutical companies have the legal right to sue other companies that attempt to produce similar drugs. Thus the company holding the patent becomes the sole producer of that patented drug. As a result, there are no other company that can produce the drug and consequently, no close substitutes of such a drug. Companies now have the authority to “charge an artificially high price”(“The Impact of Patents on Access to Medicines”). With no competition or restrictions, there is nothing holding back drug companies. If a consumer wants to purchase this patented drug, the consumer must buy the drug from that specific company at the set price. Furthermore, “patent protected drugs are often essential for people’s health or even their lives. Allowing a drug company to have a monopoly where it can charge whatever it can force the individual, or more typically the insurer or the government, to pay makes little sense” (Baker). Medical pharmaceuticals are perfectly inelastic, meaning that at any price,
These obscene prices have sparked a massive protest from people who rely on this medicinal product to survive. The increase in price has made it harder for many to afford so many have demanded a decrease in price. However, the company argues that since they made the product, they should be allowed to sell their product for whatever price they decide on.
Pros of Patenting (Megan): Medical drug prices are affected greatly by the existence of patents. Many economists support the phenomenon of patenting drugs due to the benefits that patents have in the field of medicine and the drawbacks that can exist when they are not used. For example, patents are crucial to the research and development of new drugs. For a company to get a drug to the market, they must go through a very challenging, time-consuming, and tedious process of attempting to discover and produce a new drug. This task includes numerous failures and even if a new drug is discovered, it is not always approved for distribution in the market. It often takes up to twenty years to complete …show more content…
Economists from this school of thought believe that drug patenting is unfair to consumers as patenting creates a monopoly. Big corporations claim intellectual property of the products through a patent and are given the authority to produce this drug. “A drug company that holds patents on a medicine has the right to prevent others from manufacturing it “ (“The Impact of Patents on Access to Medicines”). Therefore, pharmaceutical companies have the legal right to sue other companies that attempt to produce similar drugs. Thus the company holding the patent becomes the sole producer of that patented drug. As a result, there are no other company that can produce the drug and consequently, no close substitutes of such a drug. Companies now have the authority to “charge an artificially high price”(“The Impact of Patents on Access to Medicines”). With no competition or restrictions, there is nothing holding back drug companies. If a consumer wants to purchase this patented drug, the consumer must buy the drug from that specific company at the set price. Furthermore, “patent protected drugs are often essential for people’s health or even their lives. Allowing a drug company to have a monopoly where it can charge whatever it can force the individual, or more typically the insurer or the government, to pay makes little sense” (Baker). Medical pharmaceuticals are perfectly inelastic, meaning that at any price,