Monopolies Vs Drugs

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In the text, Issues in Economics today, Robert Guell states that in 2009 prescription drugs amounted to 10% of all U.S. health spending.
When a new medication is developed it is issued a patent .A patent allows the inventor to have exclusive rights to sell the product, thus creating a monopoly. These monopolies can be more important on certain types of drugs. Orphan drugs or drugs that treat diseases that only a small number of people suffer from are granted longer patents. Without the longer patent the there would be an even smaller profit making it unlikely that medications would be developed for less significant diseases. However, Monopolies created by patents only last so long and competition can is created by generic forms of drugs. Without this competition when the seller adjusts prices to sell more product they have to lower the price to all consumers, including those who were willing to pay the higher price. In effect, slightly counteracting the fact that they are selling
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Much to the disagreement of the general public, who want the cheaper prices, Plasari believes that opening the markets to foreign prescription drugs would allow for counterfeit, cheap reproductions, expired drugs, etc. Obviously these less than quality drugs would be harmful to the recipients. Countries that allow for pharmaceutical importation from other countries are now facing a large counterfeit drug problem. According to the World Health Organization, estimated over 200,000 fatalities were causes as a result of counterfeit

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