Last week I made the case that one of the significant dangers of our economic system is that those without pricing power are not able to create wealth by design. The thing is, most Americans don’t have pricing power. The pharmaceutical company does. Corporations through their executives and shareholders do. This reality is a clear and present danger for us all. Here is the deal.
Last week I wrote the article titled “Why our economic system is designed to keep most people broke by robbing us legally,” that everyone should read. I used the insulin example to explain.
It is easy to understand why the increasing price of drugs has life or death consequence in the immediacy. What is not immediately apparent is how this mechanism, this economic system by design is intended to rob you blind.
Insulin is an old medicine, over 100 years old. There is no patent on it. Worse as noted in the article above, it was virtually placed in the public domain. Therefore it should be one of the cheapest drugs on the market. There is a virtual monopoly in companies selling the product. They determine the price. The private sector determines how much they will force you to pay for a drug you must have.
Pricing of any product in our economic system is based on a corrosive concept known as “Whatever the market will bear.” And what will the market bear? All of your income plus your total creditworthiness, how much you can borrow.
Sadly, the reality is that corporations whose fiduciary responsibility is to their shareholders and their huge undeserved will keep raising prices until people are simply unable to afford what they are selling. If it is something they must have, Americans will spend up to their limit to get it
tenets of the current economic system are predicated on this behavior that effectively prevents us from saving. It makes us entities that are nothing but conduits of our income used to create the increasing wealth of a few, those who determine prices, the Plutocrats.
After all the bad press on their predatory insulin pricing, Eli Lilly decided to modify their pricing scheme.
Eli Lilly introduces generic insulin at half the price of brand-name drug – CNN
(CNN)Pharmaceutical company Eli Lilly will sell a cheaper generic version of its rapid-acting insulin Humalog, according to a statement Monday from Chairman and CEO Dave Ricks.
At 50% the price of Humalog, the generic insulin lispro will carry a list price of $137.35 per vial, the company said, or $265.20 for a pack of five pens. Brand-name Humalog will remain on the market.The move comes amid growing concerns about the soaring prices of drugs — insulin in particular — which have led many people with diabetes to cut back on their insulin in order to save on costs, in some cases leading to harmful or even deadly complications..”We don’t want anyone to ration or skip doses of insulin due to affordability. And no one should pay the full Humalog retail price,” Ricks said, describing the generic drug as “a bridge that addresses gaps in the current system until we have a more sustainable model.”
Source: Eli Lilly introduces generic insulin at half the price of brand-name drug – CNN
The fact that Eli Lilly could drop the price in half is probative. One knows they are making assive profit at half price. They are making an obscene profit at full price. They only acted out of fear that the government, “we the people” would outlaw their form of legal theft.
By economic system design, the corporate executive’s job is to maximize profit for their shareholders and with that, themselves. Their fiduciary responsibility is not with you but the shareholders. You are just the raw material for them to profit. It is clear, that unless the government “we the people” intervenes, corporations will maintain their extractive modal.
My rant on the evils of corporate pricing power
