Archive for May, 2011

Economics of Generic Drugs

May 31, 2011

The Danger:

WASHINGTON (AP) — A growing shortage of medications for a host of illnesses – from cancer to cystic fibrosis to cardiac arrest – has hospitals scrambling for substitutes to avoid patient harm, and sometimes even delaying treatment.

“It’s just a matter of time now before we call for a drug that we need to save a patient’s life and we find out there isn’t any,” says Dr. Eric Lavonas of the American College of Emergency Physicians.

The primary culprit:

The Food and Drug Administration agrees that the overarching problem is that fewer and fewer manufacturers produce these older, cheaper generic drugs, especially the harder-to-make injectable ones. So if one company has trouble – or decides to quit making a particular drug – there are few others able to ramp up their own production to fill the gap, says Valerie Jensen, who heads FDA’s shortage office.

An exception to the rule:

Some experts pointedly note that pricier brand-name drugs seldom are in short supply.

Another exception:

The FDA has taken an unusual step, asking some foreign companies to temporarily ship to the U.S. their own versions of some scarce drugs that aren’t normally sold here. That eased shortages of propofol, a key anesthesia drug, and the transplant drug thiotepa.

It would be interesting to see how many of the 211 drugs on the shortage list are freely available in non-FDA countries.

Source:
Hospitals hunt substitutes as drug shortages rise, LAURAN NEERGAARD, AP Medical Writer

Libertarianism – Selfish or Selfless?

May 29, 2011

Glenn Reynolds:

Actually, Libertarians Aren’t Selfish. And people who would spend other people’s money on charity aren’t generous, I should add.

Yahoo Answers:

People consider the libertarians selfish because they have no desire to take from others. People consider the libertarians arrogant because they don’t tell others how to live their lives.

Normally that wouldn’t necessarily be a problem, except libertarians want that same respect from others.

Those who want money from others think it is selfish when the others don’t give. Those who want power over others think it is arrogant when others don’t obey. Source

VolokhConspiracy: – Libertarianism and Selfishness by Ilya Somin

BOB OWENS: Seventy-One Shots: The Death of Jose Guereña.

May 26, 2011

via the article:

Dupnik’s SWAT team initially claimed that Guereña fired at them while they were serving a warrant — as he slept. They claimed that his bullets hit the bulletproof shield that the entry team hid behind, and that the barrage of bullets they fired back was in self-defense.

Only, Guereña never fired his weapon. Awoken by his wife with screams that men with guns were invading his home and threatening his family, Jose Guereña armed himself with a AR-15 rifle and crouched in the hallway. The SWAT team unloaded upon Guereña on sight. He apparently recognized the home invaders as police. He took 60 rounds, but never — as the Pima County Sheriff’s Department was forced to admit — took off his weapon’s safety as he was being killed. . . . A Marine veteran of Iraq that had the discipline not to fire — a discipline that a trigger-happy SWAT team which has now killed three men in less than a year cannot itself exercise?

quote from glenn Reynolds:

Police shouldn’t launch this sort of raid absent an imminent threat to life. They go wrong too often. And clowns like Pima County’s Sheriff Dupnik shouldn’t be around guns of any kind.

The hardest question for antis…..

May 16, 2011

From THR:

“here’s a simple, straightforward question: Why do you find it necessary and even praiseworthy to LIE so much?”

I find this par for the course in pretty much all political debates that involve science. From smoking/cancer link, CFC/ozone, C02/climate change, Corn Ethanol/Climate Change Solution…. the list goes on and on and on. Typically I find it liars vs incompetent debaters (different than incompetent scientists) or journalists that don’t have the background to debate properly. Only occasionally is the debate polarized among liars vs skilled debaters w/scientific knowledge.

So how do you spot a liar? It’s relatively easy. Everybody makes mistakes. Honest people admit when they are wrong and make public corrections. The liars almost never admit when done something wrong. They just keep digging in. Find a situation where two parties are arguing over the mechanics/results of a repeatable experiment and the intentions of both parties should become very clear very fast.

TO DO: find examples: LS, Dan Rather, VPC, HCI, Corn, Pat Michaels..

The hardest question for antis…..

May 16, 2011

From THR:

“here’s a simple, straightforward question: Why do you find it necessary and even praiseworthy to LIE so much?”

I find this par for the course in pretty much all political debates that involve science. From smoking/cancer link, CFC/ozone, C02/climate change, Corn Ethanol/Climate Change Solution…. the list goes on and on and on. Typically I find it liars vs incompetent debaters (different than incompetent scientists) or journalists that don’t have the background to debate properly. Only occasionally is the debate polarized among liars vs skilled debaters w/scientific knowledge.

Medibid: Healthcare Cost Solution

May 15, 2011

Medibid – Removes insurance middle men from the healthcare process. A huge benefit given the massive difference between what the insurance companies pay and what the sticker price actually is. Hopefully this will bring the sticker price more in touch with reality. h/t Since the whitehouse opposes insurance competition across state lines this may be the next best thing.

Obama – To have one’s healthcare cake and eat it too (ignores economics 101)

May 15, 2011

“My preference would be that you don’t have to travel to Mexico or India for cheap healthcare,” he said in response to a question about why US health insurance won’t cover medical expenses incurred abroad.

“I’d like you to be able to get it right here in the United States of America that’s high quality.”

Obama also said that prices of prescription drugs must be brought down “so that you don’t feel like you’re getting cheated because you’re paying 30% more or 20% more than prescription drugs in Canada or Mexico.”

Number healthcare regulatory bodies in the US:

  1. Centers for Disease Control and Prevention
  2. Department of Health and Human Services (DHHS)
  3. FedWorld – US Government Information
  4. The Food and Drug Administration (FDA)
  5. National Center for Complementary and Alternative Medicine (NCCAM)
  6. National Center for Infectious Diseases (NCID)
  7. National Institutes of Health (NIH)

  8. National Library of Medicine
  9. National Science Foundation
  10. Office of Disease Prevention

Number of Mexican regulatory Bodies:

  1. Ministry of Health

Price is a delicate balancing act between quality, regulation, quantity supplied/demanded and research and investment. If you take away the dollars in a competitive market then one of the above has to be decrease. It’s that simple. Once the patents expire on drugs & techniques, you can’t blame greedy companies for fixing prices. At that point the market (and the government) decides the price.

TO DO: Sort them by relevance to price & quality. Research international patent laws. Research international research budgets. Plot growth in US regulatory industry within last few years.

Source:
US healthcare: Obama talks to curb medical tourism to India, HT Correspondent, Hindustan Times, Washington, April 20, 2011

Higher Education Bubble – The Economist Misses the Lessons of the Housing Bubble

May 14, 2011

[Rough Draft]

Anyone that’s read Sowell, Roubini or Raghuram Rajan knows the housing bubble and the great recession were driven (either in part or by whole) by the following:

  • *Excessive risk taking ( caused by the Greenspan / Bernanke put, low interest rates & ninja loans)
  • *Moral Hazard (caused by the bailouts)
  • *Miss-Perceptions / Miss-information (Which causes prices in the market to be off target)

What does this have to do with education bubble?

  • Low interest rates – causes people to borrow more than they normally would
  • Easy Money – No pre-filtering just like the housing bubble ninja loans allows people that shouldn’t go to college to go into crippling amount of debt
  • Miss-Perceptions / Miss-information / transparency – Ever ask a MBA Dean what the average salary of their graduating class is? Or job placement rate post graduation? The typical answer is “we don’t track our students post graduation”. Just like the housing bubble, a lack of transparency is a major driver for inflated tuition rates. Once the post-graduation job placement rates and salary info are public, the market will price tuition rates off of something more accurate than marketing hype.
  • Moral Hazard – What happens when students can’t pay? Well they can’t get rid of the debt with bankruptcy.

Our higher educational system has every incentive in the world to drown kids in debt they simply won’t be able to afford.

The Economist also wonders why a cheaper alternative hasn’t been produced. Well it has, and it’s called khanacademy.org. We just need to get past the stigma of an online degree.

Sources:
http://www.economist.com/blogs/democracyinamerica/2011/05/higher-education_bubble
http://www.economist.com/blogs/freeexchange/2011/05/education

What Would Alexander Hamilton Say about ObamaCare?

May 7, 2011

Alexander Hamilton was the big government man of his time. He was so far on the big government side that even John Adams and other members of his own party (Federalist) respected the small government Republican Thomas Jefferson to a much greater degree. Despite this, even he understood the perils laws that are so long they can not be read and so flawed they require numerous exemptions.

The internal effects of a mutable policy are still more calamitous. It poisons the blessing of liberty itself. It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is to-day, can guess what it will be to-morrow. Law is defined to be a rule of action; but how can that be a rule, which is little known, and less fixed?

Obamacare Facts and Figures:
> 1,000 exemptions
2309-Pages long
Quote: “We have to pass the bill so you can find out what is in it” – Nancy Pelosi

Sources:
The Hill
Number of healthcare reform law waivers climbs above 1,000
, Jason Millman – 03/06/11 04:38 PM ET
Heritage Foundation, Video of the Week: “We have to pass the bill so you can find out what is in it”, March 10th, 2010 at 3:30pm