The pharmaceuticals industry is not a charity

The argument

Proponents argue that the pharmaceutical industry should be judged by the standards applied to any other business rather than by those applied to a charity. Like all businesses, its goal is ultimately to make as much money as the boundaries of supply and demand will allow, and it has to do so in order to remain in operation — the revenue is not a surplus extracted from patients but the condition of the company continuing to exist at all. It follows that as the pandemic provides a high demand for a vaccine, the cost of such a drug is driven upwards, in the ordinary way that scarcity and demand set a price. The cost of pharmaceutical research on such a disease pushes in the same direction. The supply side reinforces the point. Pharmaceutical companies do not have an unlimited amount of resources to produce vaccines and medications that are not in demand; running clinical trials is laborious and, in turn, expensive, and it often comes with high entrepreneurial risk, since money spent on a candidate that fails is not recovered. Thus, in order to cover the cost of such development, drugs will cost money. A firm that priced its successes at cost could not fund the failures that necessarily precede them. The argument closes by appealing to consistency. Such economic understanding is granted to the weapons and ammunition industries as well as to the tobacco industry — and the tobacco case is the sharper one, because that industry makes money off the health of millions, yet when a tobacco ban is discussed it fails to pass due to the jobs the industry provides. If society already accepts commercial logic where the product damages health, proponents hold, the same understanding should be allotted to companies within the pharmaceutical industry, whose product improves it.

Premises

Counter-arguments

Businesses within the pharmaceutical industry have a moral obligation to provide fairly priced drugs. They should not use consumers as a means to profit without prioritizing fair access to medication. Specifically, the central problem within the pharmaceutical industry is simply that there is a lack of competition— an aspect that is heavily protected by current drug patent laws. The potential to profit that arises from these protected monopolized drugs incentivizes companies to raise prices to obscene levels. As a result, patients are unable to acquire medication they need to survive. This is inherently wrong. As citizens, we should call on policymakers to follow plans set forth by both President Clinton and Trump who believe that allowing Americans to import drugs (that meet FDA standards) from other countries will create competition, and drive down prices.

Rejecting the premises

[Rejecting P1] The premise describes an unconstrained market that does not exist in this sector: development is substantially underwritten by public research funding and, for pandemic vaccines, by advance purchase commitments and direct subsidy, so pricing does not simply recover privately borne risk. [Rejecting P2] The analogies work against the argument, since tobacco is regulated, taxed and restricted precisely because the market's own logic produces harm, and arms sales are licensed by governments — so citing them concedes that societies limit commercial freedom where the stakes warrant it, and the conclusion about healthcare being a privilege does not follow from a claim about how firms are financed.