Recently I have been writing that the federal government should not move forward in negotiating or lowering drug prices. Shopping is expanding and the benefits of new pharmaceuticals are huge.
But it’s not as simple as “high prices.” There is also price tracking over time. Higher prices today can lead to more competition, which could mean lower prices tomorrow, perhaps much lower prices. If not tomorrow, maybe five or ten years from now.
Higher prices today may mean greater efforts at price discrimination, including over time. That can also mean lower prices (compared to the counterfactual) in the long run, or sometimes even today.
So yes it is good to have high prices of medicines. But in most cases you end up with lower prices and, not always and not for everyone.
So shout from the rooftops: “I am not a demonic Satan, I am high and low prices as part of a complex mix, to increase the elastic supply.” Catchy, isn’t it?
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