On Wed, 12 Mar 2008 13:11:00 -0400, "Ed Huntress"
wrote:


"Bruce in Bangkok" wrote in message
.. .
On Wed, 12 Mar 2008 02:17:54 -0400, "Ed Huntress"
wrote:


"Bruce in Bangkok" wrote in message
...
On Tue, 11 Mar 2008 11:27:26 -0700 (PDT), Millwright Ron
A whole bunch cut

Ed Huntress- Hide quoted text -

- Show quoted text -

This thread is going off at a tangent. I responded to Hawke's
statement that "In fact, they are kicking our asses", by stated that
the U.S. has priced themselves out of the world market and gave the
example of the cost of Zestril in Thailand vis-a-vis the U.S.

More snipped

U.S. today.

I don't disagree that prices here are too high to be competitive against
low-wage countries. But your example was a bad one. The pharma business
isn't driven by competition or manufacturing costs. Manufacturing costs in
the pharma business, for all except a very few drugs, mostly certain
biologicals, are trivial. The costs are in development (typically $200
million - $500 million for a new drug) and marketing.

Zestril, manufactured by AstraZensca, in the United Kingdom, and
imported into thailand, costs 12 bucks in Thailand and 48 bucks in the
U.S. The same stuff, made in the same factory.

Well, that should make the point clear, then. It isn't manufacturing costs,
if they're being manufactured in the same place. A-Z manufacturers in 20
countries around the world, though (they were my client for four years) and
it's not likely yours is coming from the UK. Most likely it's coming from
IPR Pharmaceuticals in Puerto Rico, which is A-Z's high-volume manufacturer
for Zestril. I should point out, too, that A-Z markets Zestril under license
from Merck. Like most drugs, it was developed in the US. That's the benefit
from not having price controls. They can sink all of those development costs
in the US market, so they develop the drug here, develop the worldwide
marketing for it here, and, if you want to include PR as part of the US,
they manufacture it here. With our liberal patent laws they'll make most of
their money on it here, too.

Well, the box is marked "manufactured in the United Kingdom" so I
assume that it is.

Thailand's pharma price controls are most likely making the difference. Or,
in the case of Zestril, it may be competition from a generic that's being
made under compulsory license (and being fought over in the courts as we
speak). The competition varies for generics from country to country. There
are some known side effects with the generics (lisinopril), which, depending
on where you are, may make them a bigger or smaller competitive factor.

As I say in another post, the Thai's don;t have any "price controls"
on drugs, or anything else that I know of. what they do have is import
duties.


The big point, however, is that pharmaceuticals don't operate in anything
like a real market. It's totally convoluted and twisted by everything from
government regulations in use, to price controls, to patent fights. The
closest thing to a "free" market for drugs is the US. And even here the
normal market forces of supply and demand, choice among competitors, and so
on, is so distorted that "markets" are hardly recognizable.

Certainly. the Thai Pharma controls basically control only the sale of
narcotics or other drugs of that type, but that is more of a police
matter then anything else.

AstraZeneca does it the same way as all the other big pharmaceutical

remaining pharmaceutical conversation deleted


Only for those who don't have a solution for competing with $0.80/hour
wages
in China. They'll blame the unions, which is foolish on its face. The
problem would be the same if our wages were half what they are now. We're
already the most productive manufacturing country in the world. Most
people
don't realize that.

The problem isn't wages as such. It is that the "standard of living"
in the U.S. is far higher then in other countries and thus wages must
match. You MUST have air conditioning, MUST have a dishwasher, MUST
have a car, MUST have this or that, this or that your parents did
perfectly well without, and of course to pay for these things you need
to make more money.

Of course, in some cases, the fact that everyone owns a car (for
example) means that cities, mainly west of the Mississippi, don;t need
public transportation, thus in the 1970's the voters voted down a bond
issue in Los Angeles two years in a row.

As they say in New York, "what goes round, comes round" and as the
"standard of living" goes up so do the wages you must receive to
purchase these items. Of course the increased money circulating in the
economy tends to drive up prices - after all now that one has more
money to spend the likely result is that it will be spent.


And probably the most technically advanced. But unfortunately that
isn't helping Ohio (was it) where jobs are evaporating like water on a
hot sidewalk.

Right. It's going to take some intrusive management of trade. There's really
no way around it, unless we want our true incomes, based on the falling
dollar, to drop to third-world levels.

I don;t believe it is possible. Our Comptroller used to tell the story
about working as an accountant at a company that had a "cost cutting"
program. He asked the comptroller "what is the cost cutting program"
and was told "anything that doesn't effect this department".

No one is going to accept a voluntary cut in income. whether it is a
company or a worker. It is just not human nature.


More snipped

With lightning speed. GM basically packaged an engine-manufacturing plant in
crates when they set up their Chevy engine line in Shanghai, which now makes
the engines for Chevy SUVs assembled in Canada and sold in the US. No theory
ever predicted that things like that could happen. No theory is capable of
dealing with the consequences.

Of course. and the guy that promoted the scheme undoubtedly got a very
large bonus or a promotion for coming up with the idea.


In closing, this subject is spreading rapidly. If we don;t stop we
will be into scientology or illegal immigrants if we aren't careful
(probably also impossible to solve subjects). I suggest that we either
end or chop it up in pieces to cover one subject each.


Bruce-in-Bangkok
(correct email address for reply)