John Tierney joins City Journal editor Brian Anderson to discuss what the debate over prescription drugs gets wrong and the cost that government-imposed price controls could have on one of the world's most innovative industries.
The business practices of the pharmaceutical industry--or "Big Pharma"—are one of the most divisive political issues of our time. Leaders from both political parties, from Bernie Sanders to President Trump, regularly denounce drug companies for profiteering and call for lower drug prices. But as Tierney notes in City Journal, "of every dollar that Americans spend on health, only a dime goes for prescription drugs. The lion's share of health spending goes to hospitals and people in the health-care professions."
America has been called the "Pharmacy to the World" because it's where more than half of new drugs get developed and tested in clinical trials. Patients in Europe and elsewhere enjoy the benefits of these breakthrough drugs. Price controls in the U.S. would significantly curtail new research and development projects--resulting in a net loss for everyone.