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  • Madison Lazenby

Insulin For All: Nationalizing the Pharmaceutical Industry

The American healthcare system is in crisis, and everyone knows it.

Despite spending the most on healthcare than any other developed nation, the United States ranks 24th in health goals set by the United Nations. Americans live an average of 78.6 years- a full 3.7 years less than comparable developed countries. Most shockingly, a 2019 Gallup poll found that “25% of Americans say they or a family member have delayed medical treatment for a serious illness due to the costs of care.” These are not the features of a functioning system or even one that values human life.

Over the past few years, support for Senator Bernie Sanders’ (I-VT) Medicare-for-all has exploded, with over half of Americans favoring such a plan since 2016. Under Medicare-for-all, “single-payer, national health insurance program [would] provide everyone in America with comprehensive health care coverage, free at the point of service.”

Under Medicare-for-all, prescription drug prices would be capped- a desperately needed development, as Americans spend more money on prescription drugs than any other country. While capping drug prices would be a much-needed step in the right direction, a better solution would be fully nationalizing the pharmaceutical industry by putting all private pharmaceutical firms under the control of the government.

Whenever pharmaceutical companies are threatened with government intervention in response to their absurd price gouging of desperately needed medicines, they turn to the same, tired excuse: high prices in the United States fund research and development of new drugs. Under this argument, millions of people being unable to afford their prescriptions is a small price to pay for the ground-breaking and life-saving medicines that the American pharmaceutical industry regularly discovers.

There are multiple flaws in this argument. First, according to Public Citizen, only about 22% of new drugs can be considered “innovative drugs that represent important therapeutic advances” over existing medicines. The other 78% of newly invented medicines are derivatives “that have little or no therapeutic gain over existing drugs.” In other words, we don’t need to invent more insulin- we just need to get it to the people with diabetes.

Furthermore, pharmaceutical companies exaggerate the amount of money that they spend on research and development. Nine out of the ten biggest pharmaceutical companies spend more on marketing than research, including Johnson and Johnson, which spent 17.5% of their budget on marketing compared to 8.2% on research for new drugs. Clearly, the high prices being charged by these firms are unnecessary if we are only worried about research and development. Nationalizing this industry could go hand-in-hand with banning the marketing of prescription drugs, as without the incentive to make obscene profits, the government would not need to convince doctors to prescribe their product. This would also prevent addiction epidemics that have occurred in the United States, including the oxycontin addiction that swept the nation as a direct result of Perdue Pharmaceuticals' heavily marketing towards doctors to overprescribe the painkiller.

Finally, private companies heavily rely on publicly funded research to develop new drugs. According to the Center for Integration of Science and Industry, every one of the 210 new drugs approved by the FDA from 2010 to 2016 was developed as a result of research conducted by the National Institute of Health. Pharmaceutical companies buy this publicly funded research, patent it, continue development, and eventually sell the new drug to Americans at ridiculous prices. As the government is perfectly capable of conducting crucial basic pharmaceutical research, it is hard to see why it wouldn’t be capable of continuing drug development and testing. A nationalized pharmaceutical industry would save Americans billions while having minimal impact on the research and development of useful new drugs.

A publicly-funded pharmaceutical industry would also help in the fight against antibiotic resistance. As more antibiotics are used and over-used, microbes develop resistance to their effects. According to public health officials, ten million people could die a year due to antibiotic resistance by 2050. Private corporations have a little profit incentive to spend billions on the development of new antibiotics, as they are often only used by small groups of people for limited amounts of time. This is why the industry has largely abandoned the search for new antibiotics for thirty years. Just because a medicine doesn’t provide shareholders with their requested profits doesn’t mean that it isn’t desperately needed, and the government must step into such a situation to fund the discovery of new antibiotics and save millions of lives. This situation is indicative of a wider problem in the private pharmaceutical industry, as such an essential service should not be provided by firms driven by profit.

America desperately needs an increased government role in its pharmaceutical industry. While many harms may be reduced by a price cap on medicine, or by creating a publicly-owned firm, the best option may be the full-on nationalization of the industry. While nationalization is not the best option for many industries, one so connected to the health and wellbeing of our nation requires that the public control its actions.

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Mar 06, 2021


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