Free Markets and Flu - A Deadly Combo

[Sarxis]

Haven't we all seen that Free Market doesn't work at all where health care is concerned?

[Imran Siddiqui]

Are judges part of any private sector area Imran?

No, but they are required for the private sector economy to work.

[Whoha]

Ok, so the government reigning back the judical branch imposes on the economy how?

[Imran Siddiqui]

I'm just saying it is ironic. The government restricting amount of damages that can be won, in order to prevent government interference.

[Whoha]

I don't see it.

[Berzerker]

In an article called "Lack of Vaccines Goes Beyond Flu Inoculations," (12/8/2003), reporter Bernard Wysocki Jr. writes about "the malfunctioning of the small but vital marketplace for preventive vaccines in America."

There are only two companies making injected flu vaccines in the US, the article points out, French Aventis SA, and Chiron Corp. There is a third company called MedImmune Inc. with a nasal spray vaccine. But it isn't just a one-time shortage or just about the flu, the article states. "This is the eighth major shortage of preventive vaccines in the U.S. since the beginning of 2000. Shortages of vaccines for diphtheria, tetanus, chickenpox and measles have occurred since then. Flu vaccines have been in short supply for three of the past four years."

The reason behind these problems is a steady oligopolization of the vaccine industry. From 1970, when there were 25 vaccine makers, there are now only five. Companies like Merck, Wyeth, and Pfizer have gotten out of the vaccine business. "With such a small number of producers, shortages can develop quickly as a result of manufacturing problems, poor management, or a bad guess on the expected demand." In fact, flu is better off than diseases tetanus or chickenpox, which have a monopoly supplier in the US.

Part of the reason has to do with exposure to lawsuits for real or perceived vaccine-caused illness, a growing problem or delusion, depending on who you talk to. But the main problem, as the WSJ article makes clear, is price controls, on of the few areas in the US where there are government-mandated controls for pharmaceuticals.

For makers of all types of vaccines, the Institute of Medicine's report traced the decline in manufacturers' interest to the fact that the U.S. government -- predominantly through the Vaccines for Children program run by the CDC -- buys slightly more than 50% of the vaccines in the U.S., and keeps prices low.

http://www.oligopolywatch.com/2003/12/09.html

From a Wall Street Journal article.

This one deals mostly with the trial lawyers.

http://www.manhattan-institute.org/html/_dmn-liable_to_infection_flu.htm

And one dealing more with Hillary.

http://www.washtimes.com/op-ed/20031216-090326-8427r.htm

Imran -

How are lawsuits against a free market? Just about every single free market theorist has had a court with the ability to decide restitution for harms. I'd contest that a functioning court system is a requirement for a free market system.

Who said lawsuits are against a free market? They can have a damaging impact on the market. It's the level of restitution that matters and one reason why many vaccine producers have left the market is because a certain percentage of vaccinations result in illness and if the restitution costs more than the profit to be had by producing the vaccines (or a large chunk of the profits), you end up with fewer, perhaps ultimately, no (legal)domestic producers.

Mordoch - I'll get back with you, I'm watching Jamal go for the rushing yardage record.

[Berzerker]

Imran -

I'm just saying it is ironic. The government restricting amount of damages that can be won, in order to prevent government interference.

The government is interfering by having courts and laws against contract killing, if the courts are going to impose a financial burden on the producer of a product via lawsuit then the same government is already involved. I see your point but it's not like the government decided to step in after the fact, it's there all along...

[Berzerker]

Mordoch -

Based on the CDC statement, the Hillary situation claimed would be at best a one year event which doesn't explain a drop in suppliers. Far more significantly, 3 manufacturers are perfectly capable of having sufficient facilities to meet demand if they have the financial incentive to do so. Clearly at least some degree of licensing and regulations are needed to ensure that the vaccine is safe and actually works properly. Lawsuits are a components of a free market, and I'm extremely dubious that any lawsuits from private individuals would be sufficient to really hurt the company's profits given fatal complications from flu vaccines would be quite rare. If lawsuits were so bad, it wouldn't make sense that a company would release a flu-mist vaccine product in the US this year, it wouldn't make sense to spend the research dollars to allow entry into an unprofitable market. The argument appears to be a house with a foundation of this air.

The program she and her hubby began is still in effect, "Vaccines for Children". And the Wash Times article mentions several reasons for the shortages, one being government "negotiating" to buy vaccines at lower prices as well as the circumvented effort of politicians to reduce liability by the trial lawyers. There is one class action lawsuit in an article I linked showing that the lawsuit is asking for more than the yearly profit in the vaccine business. How can a company stay in business with such a liability? It's the low profit margin combined with the liability that has been driving companies out of the vaccine business. Now, why is the profit margin so low? Can't they just charge what they want in a free market? There isn't a free market when the government steps in to buy doses at reduced costs... As for your comment about the vaccine mist, the trend is obvious, roughly 25 vaccine producers 30 years ago, maybe 3 today... Something is happening...

[TCO]

I got the flu vaccine atworlk/ O was a manly MAGGGGGNNN

[Fake Boris]

Originally posted by JohnT


Spoken like a person who doesn't know what he's talking about. How is a governmental cartel raising oil prices by over 400% in a 12 month period (from $2.18/barrel in Dec. 1972 to $11.65 in December 1973), the 1973 Arab-Israeli war, and the ensuing 4-month embargo on ME oil shipments to the US by the OPEC countries (from November 1973-February 1974) the fault of the "free market"?

That was my point here. When there are no regulations to the market, the free market destroys itself because cartels emerge.

Didn't you have reading classes in elementary school? I talked about "circumventing free market laws", which is exactly what a cartel does. Which is exactly the situation that you have described in your post. Which is exactly what you would not have wasted time doing had you read my sentence more carefully.

Now, does it have anything to do with the medications? It may, it may not. But my point was to make an ironic comparison, that's all.

[DinoDoc]

What the hell are you talking about?

[JohnT]

Originally posted by Oncle Boris


That was my point here. When there are no regulations to the market, the free market destroys itself because cartels emerge.

Didn't you have reading classes in elementary school? I talked about "circumventing free market laws", which is exactly what a cartel does. Which is exactly the situation that you have described in your post. Which is exactly what you would not have wasted time doing had you read my sentence more carefully.

Now, does it have anything to do with the medications? It may, it may not. But my point was to make an ironic comparison, that's all.

... But I repeat DinoDoc: What the hell are you talking about?

Secondly, do you always have to use insults in your arguments?

[notyoueither]

I think his point is that some regulation is necessary to stop the worst excesses of 'Free' markets.

[JohnT]

The only "regulation" possible in regards to OPEC was invasion.

And the idea that the petroleum industry in the US isn't/wasn't regulated was laughable in 1912, even more so 81 years later.

[notyoueither]

And he might say that regulation is difficult in international settings where the law of the jungle still prevails.

And I suppose that US anti-trust laws are there without any justification whatsoever. None at all. They're just big meanie gobments intruding on good honest folk trying to get by, right?