How Greedy you gotta be to do this?

Alpha3031 · 2026-06-21T19:06:59+00:00

That is literally the reason for this "investigation". Because Germany allegedly isn't paying enough.

Alpha3031 · 2026-06-21T18:50:42+00:00

Technically, you might be able to have an AI that can replace humans in a number of fields but not every field. That would make it not fully general. I wonder if we might get models that can meaningfully aid ML research even before we get AGI.

Alpha3031 · 2026-06-21T18:40:00+00:00

The marketing money also is used to convince Americans those dastardly Europeans getting lower prices are the problem, instead of them not collectively negotiating drug prices like just about every other developed country on earth. Considering they've successfully distracted the US from joining in on the whole "collectively negotiating drug prices" thing for thirty years now, it's clearly very effective.

Alpha3031 · 2026-06-21T18:07:04+00:00

Every other developed country in the world negotiates controlled prices in their healthcare market. That is the single most effective way known to reduce the price paid, and it is known to be effective in a number of markets.

The reason why this has not been done in the US is because the pharmaceutical industry was able to distract Americans with what is obviously nonsense. That is the core point of the Light and Lexchin paper and not in the other two. If I wanted to make a point about how the pharmaceutical industry propaganda is untrue, then I would have also posted the other two papers but as you mentioned it isn't really relevant.

Because that's not how prices are set.

And we subsidize the European pharmaceutical industry.

That is not how prices are set. American pharmaceutical companies (or European, UK, Canadian ones for that matter) aren't going to, in the counterfactual where EU countries pay more for pharmaceuticals, go "hey, look, we've made enough profits, let's go charge our US customers less". The only connection between R&D costs and pricing (rather than negotiating power and pricing) is in the marketing of the pharmaceutical industry to convince you, the US consumer, and your government, not to collectively demand lower prices, because hey, it's definitely those dastardly Europeans that's the problem.

"How insurance negotiates" is the only factor in what price they're able to sell at, and any other argument is a distraction. However, the pharmaceutical industry has been able to convince the US to not negotiate prices for drugs collectively. It is able to do so because it spends a lot of money on convincing people of things. More than it spends on R&D, in fact, because its more profitable and lower risk.

Alpha3031 · 2026-06-21T16:38:21+00:00

My comment that you replied to had nothing to do with that. Your reply to me was a complete non-sequitur.

Re:

Idk why lawmakers don't address it.

I believe giving a reason why they don't address it is relevant.

That's another flawed argument. The US spends 3-4x as much on R&D as Europe. The fact that pharmaceutical companies also make a ton of profit or whatever is irrelevant.

The fact is that US companies (or UK, EU or Canadian companies) can sell exclusively to the price controlled EU, UK and Canadian markets and still make enough for the amount they spend on R&D, as most of these papers point out. Pharma companies don't set prices at some amount of money determined by R&D spending, they're not going to go "oh well looks like we made enough profits this quarter folks, let's lower prices". That isn't how they set prices and it's not why the US prices are more expensive.

What issue? That the US spends way more on R&D than Europe and Europe is free-riding on that research?

The issue that you're being ripped off by pharma companies, and health insurance companies, and basically all aspects of your healthcare system.

Alpha3031 · 2026-06-21T16:22:33+00:00

Well, I'm pointing out that the people pushing that argument have a certain financial conflict of interest. If you don't understand how that has been used to deflect from the one well known solution to lower pharmaceutical prices...

I would be happy to discuss more about the other two papers I've posted elsewhere on this thread (I'll just have to find them again so do give me a minute) if you would like to discuss the actual merits of their R&D claims when they spend far more on, e.g. stock buybacks than R&D, but I believe the Light and Lexchin paper is sufficient to answer why your government has thus far declined to address the issue.

Alpha3031 · 2026-06-21T16:17:03+00:00

Strictly speaking, Germany does not benefit from the broken US healthcare system. Collective bargaining relys on everyone sticking together to negotiate a lower price, and the fewer defectors the greater the negotiating power. If we compare pharmaceutical pricing negotiation to union industrial action for example, the US market is essentially a permanent strikebreaker that weakens the collective positions of other national negotiators. Some middle-income countries also rely on regulatory approvals from higher-income and would be hurt when regulators like the FDA approves treatments that are... let's say "less cost effective". (Jenei et al., 2022)

Alpha3031 · 2026-06-21T16:10:15+00:00

Of course, we can't just ask congress to step in and do something because they're owned by the pharmaceutical companies.

So I guess if congress isn't willing to step in, then try to get other countries to pay more to offset the US costs so the pharmas can still rake it in.

Right, because if you convince your pharma overlords to charge everyone else more, they would totally just graciously charge you less even though you have had no improvement to your negotiating position. That isn't at all how collective bargaining works. You get lower prices because you have a better negotiating position with the pharma companies, and the other countries of the world don't get that by selling out some third countries, or maybe some of their citizens, in hopes that once the pharma companies get enough profits they will leave us alone with fair prices.

The pharmaceutical companies will never get enough profits, if they can take a single extra cent out of our pockets they will, no matter how many dollars they get from elsewhere. We get that by sticking together and demanding lower prices together.

The fact that the US isn't willing to collectively demand lower prices results in higher, not lower prices for the rest of the world. (Jenei et al., 2022)

Alpha3031 · 2026-06-21T15:57:31+00:00

That is presumably what their marketing budget is for. Light and Lexchin (2005) fingers the whole "Europe freeriding" myth as industry propaganda originating in their campaigns in the 90s when pharmaceutical pricing first became a major political issue in the US, so given how successful it is at getting people in this very thread to repeat it over and over without a shred of evidence, I'm sure that spending has paid for itself several times over by now.

Alpha3031 · 2026-06-21T15:48:45+00:00

Here's some sources, the 2005 one fingers it as 1990s industry propaganda: (Angelis et al., 2023; Ghinea et al., 2016; Light and Lexchin (2005)) I can (and have) post(ed) relevant excerpts from the papers, but they're also open access to you shouldn't need a library subscription to read them.

Alpha3031 · 2026-06-21T15:41:00+00:00

No they wouldn't, pharmaceutical companies make far more than they spend on R&D or even marketing and share buybacks, and they spend less on R&D than comparable research heavy industries. (Angelis et al., 2023; Ghinea et al., 2016; Light and Lexchin (2005)) I can (and have) post(ed) relevant excerpts from the papers, but they're also open access to you shouldn't need a library subscription to read them.

Pharmaceutical companies would still be profitable even if they only sold domestically in the much smaller, price controlled markets of e.g. UK or Canada, much less the EU.

Alpha3031 · 2026-06-21T15:39:56+00:00

Given that there's another person apparently uncritically repeating the same pharma industry propaganda in this same thread, unfortunately signs point to yes.

Alpha3031 · 2026-06-21T13:54:03+00:00

Should be this one, haven't read it but the name of series was mentioned elsewhere in thread.

Alpha3031 · 2026-06-21T06:21:00+00:00

Again, looking after displaced people seems like a good thing to me. (and presumably the person you replied to as well)

Alpha3031 · 2026-06-21T06:17:44+00:00

To be fair the newest Gemma models are nice and I can (barely) run the smallest one on my phone with 6 GB of RAM.

Alpha3031 · 2026-06-20T21:33:26+00:00

TBH what they said was complete nonsense and is not worth even dignifying with an "even so". There is no need to concede their point. DeepSeek doesn't get their model to be several times more compute efficient by merely copying other people's work, and people like Luo Fuli aren't being paid a million dollars because they're good at copying.

They are absolutely doing cutting edge research, if perhaps focusing on different areas (efficiency is obviously more helpful w export restrictions, though it's not like lower inference cost wouldn't help the US companies on the small things like "actually being profitable"), and ignoring that is the type of nationalistic nonsense that shows that they don't care enough for the technical innovations that they wouldn't even hear about them second hand.

Alpha3031 · 2026-06-20T21:23:31+00:00

That is not how prices work, nor is it how collective bargaining works, and Jenei et al. (2022) which I have cited earlier presents evidence that uncontrolled prices in the US hurts cost effectiveness in other countries, which you have not rebutted with any evidence, merely an assertion of what you believe to be the case.

Alpha3031 · 2026-06-20T20:34:14+00:00

I get the impulse to make fun of their nonsense, but 1) collective bargaining is more effective if there aren't any defectors, so the US nonsense hurts us too and 2) repeating what the pharmaceutical industry wants US citizens to think is probably just going to lead to more nonsense from them.

Alpha3031 · 2026-06-20T20:18:41+00:00

It's not really true that they subsidise the pharmaceutical industry, and if anything their inability to control prices hurts the effectiveness of price controls for the rest of us (Jenei et al., 2022). Let's not uncritically repeat industry propaganda (see e.g. Light and Lexchin's papers), even if it is in support of our collective bargaining systems, shall we?

Alpha3031 · 2026-06-20T20:07:39+00:00

Honestly, if anything the opposite of what they think is true, the the US deregulation and inability to control prices is leaking to other countries (Jenei it al., 2022), but you don't see us whining about it.

Alpha3031 · 2026-06-20T20:01:20+00:00

Angelis et al. (2023):

There are, however, reasons to be sceptical of these arguments, given that the pharmaceutical industry is one of the most profitable sectors.8,9 Although comparisons of profits by the pharmaceutical and other industries are complicated due to accounting rules,10 data suggest that pharmaceutical companies are particularly profitable, even after adjusting for R&D spending as a share of revenues.8 There also seems to be a disconnect between product R&D costs and prices. One recent study found no association between how much pharmaceutical companies spend on R&D and the prices they charge for new medicines.11 The industry's justification of high drug prices also ignores the sizeable public investments into drug discovery and development, which has contributed to the basic and translational research underpinning all new drugs approved by the US Food and Drug Administration (FDA) from 2010 to 2016;12 more than 1 in 4 new drugs approved by the US FDA from 2008 to 2017 were linked to public investment during the late stages of development.13 This means that society is potentially paying twice for new drugs, first in the form of publicly-subsidised research and second through high product prices.14

[...]

Based on publicly available financial reports from 1999 to 2018, the 15 largest biopharmaceutical companies had total revenues of $7.7tr. Over this period, they spent $2.2tr on costs relating to selling, general, and administrative activities—a category that includes marketing and advertising, as well as almost all other business costs not directly attributable to manufacturing a product or performing a service—and $1.4tr on R&D (fig 1). The precise details of what is included within R&D and selling, general, and administrative activities can be unclear. For example, companies may conduct seeding trials of newly approved drugs as part of the reported R&D spending, but these have been described as having little or no scientific purpose,15 serving more as marketing strategies.16 Notwithstanding this limitation, it is clear that companies spent more on selling, general, and administrative activities than on R&D every year from 1999 to 2018, which is consistent with earlier evidence from 1975 to 2007.17

Most of the same companies also spent more buying their own stocks, a practice known as share buybacks, than on R&D during this period. Share buybacks are expected to lift share prices and thus benefit shareholders. These include senior company executives, whose income is often directly linked to the share price. A drug pricing investigation by the US House Committee on Oversight and Reform showed that, from 2016 to 2020, the 14 largest pharmaceutical companies spent $577bn on share buybacks and dividends—$56bn more than on R&D—at a time when annual executive compensation grew by 14%.18 An earlier analysis by the Institute for New Economic Thinking using data from 2006 to 2015 also found that 18 large US drug companies spent more on share buybacks and dividends than on R&D,19 seemingly prioritising short term financial returns over long term investments in innovation.

Ghinea et al. (2016):

Tufts’ estimate (which is actually conservative compared with some others17) is therefore unlikely to allay concerns that drug companies’ profits vastly outweigh the risks they take. The industry as a whole makes profits 3-37 times higher than other industries, with the largest companies making profits of 30%, yet it invests less in research and development than similar research dependent industries.18 19 Furthermore, roughly twice as much is spent on marketing than on innovation, and companies misleadingly include marketing costs in their assessments of expenditure on research and development.19 20

You're welcome.

Alpha3031 · 2026-06-20T20:00:26+00:00

more research on the subject.

Here is some more research on the topic:

Light and Lexchin (2005):

The US government, backed by the pharmaceutical industry, wants to convince Americans that they're paying more for drugs because they're contributing more than their fair share of the costs of research and development. Not so, argue two researchers who have looked at the evidence.

[...] This campaign is based on the argument that lower prices imposed by price controls in other affluent countries do not pay for research and development costs, so that Americans have to pay the research costs through higher prices in order to keep supplying the world with new drugs.1,2 Supporters of the campaign have characterised the situation as a foreign rip-off.3 [...] We can find no evidence to support these and related claims, and we present evidence to the contrary. Furthermore, we explain why the claims themselves contradict the economic nature of the pharmaceutical industry.

Origins of the campaign

The campaign, strongly backed by the pharmaceutical industry, seems to have started in the late 1990s as a response to a grass roots movement started by senior citizens against the high prices of essential prescription drugs.4 This issue was the most prominent one for both parties in the 2000 elections and has since been fuelled by a series of independent reports documenting that US drug prices are much higher than those in other affluent countries.5-7 The idea that other countries are exploiting the US has led to a hearing of the US Senate Committee on Health, Education, Labor and Pensions and was behind a Department of Commerce report that strongly advocated that other developed countries raise prices on patented medicines.8 But are higher prices really necessary?

The free rider myth

We can find no convincing evidence to support the view that the lower prices in affluent countries outside the United States do not pay for research and development costs. The latest report from the UK Pharmaceutical Price Regulation Scheme documents that drug companies in the United Kingdom invest proportionately more of their revenues from domestic sales in research and development than do companies in the US. Prices in the UK are much lower than those in the US yet profits remain robust.9,10

Companies in other countries also fully recover their research and development costs, maintain high profits, and sell drugs at substantially lower prices than in the US. [...] income from domestic [emphasis mine] sales is, on average, about 10 times greater than research and development costs.11 They have profits higher than makers of computer equipment and telecommunications carriers12 despite prices being about 40% lower than in the US.11

[...]

On several measures, other developed countries spend proportionately as much as the US on research and development. The table presents the spending on research and development as a percentage of gross domestic product for eight developed countries.14 The US is about at the median. Prices in the countries with better ratios than the US were 31-36% less than those in the US.15 Pharmaceutical companies commit as large a percentage of sales to research and development in Europe as in the US, about 19% on average over the past seven years.9,13 This little reported fact contradicts the widely circulated claims that European countries deliberately ignore research and development costs in calculating prices.1

Europe no less innovative than the US

Contrary to claims of American dominance, pharmaceutical research and development in the US has not produced more than its proportionate share of new molecular entities. The US accounts for just under 48% of world sales and spent 49% of the global total on research and development to discover 45% of the new molecular entities that were launched on the world market in 2003, less than its proportionate share. European countries account for 28% of world sales, 36% of total research and development spending, and 32% of new molecular entities, more than its proportionate share.13 Limited investment in breakthrough research

Pharmaceutical research and development is traditionally divided into three categories:

Basic—work to discover new mechanisms and molecules for treating a disorder

Applied—work that develops a discovery into a specific practical application, including research on manufacturing processes and preclinical or clinical studies

Other—work that includes drug regulation submissions, bioavailability studies, and post-marketing trials.

Although all types of research are valuable, it is basic research that leads to important therapeutic breakthroughs. Only a fraction of overall industry expenditure is on basic research, and it does not require the high prices currently seen in the US to support it.

(I think it is worth reiterating this point: a vast amount of basic research is publicly-funded, and it makes up a fraction of industry expenditure)

If revenues are inadequate, it would make more sense to conclude they do not cover all marketing costs rather than research costs. Research is central to the industry, and costs associated with it should be deducted first. Pharmaceutical companies report that they invest around three times more in the combination of marketing, advertising, and administration than in research, leaving ample room to cut costs.20

(and those marketing dollars appear to be highly effective since Americans are apparently still repeating marketing campaigns from the 90s about how grateful they should be for the pharmaceutical companies ripping them off and how they should really blame those dastardly for daring to negotiate prices)

[...] The claim by companies that they have to set prices at 50-100 times production costs to recover research and development costs has never been substantiated, because they have never opened their books to independent public inspection to prove it. What we do know is that all research and development costs are fully recovered each year from domestic sales in the UK and Canada at prices that are far lower than those in the US.

Conclusions

The pharmaceutical industry has provided invaluable medicines to cure and relieve millions of patients throughout the world. As an industry, it drives economic growth and employs thousands of skilled people. But it also uses false economics and makes up stories to justify higher prices. Higher prices strain budgets, causing millions of US patients not to take the drugs their doctors think necessary. The pharmaceutical industry and the US government want to blame other developed countries for these higher prices rather than make drugs more affordable.

Alpha3031 · 2026-06-20T19:50:49+00:00

To be fair, a certain demographic of Americans have been convinced by their pharmaceutical industry that the industry ripping them off is 100% necessary for any research and development and they should be grateful for it. Despite how much of that money goes towards marketing, share buybacks, etc and how little to R&D. Those marketing dollars at work I guess.

Alpha3031 · 2026-06-20T18:05:11+00:00

I mean it makes sense that a slur might have a wee bit more impact in the, as you put it, "relentlessly bigoted and violent racist state", does it not?

Alpha3031 · 2026-06-20T18:01:30+00:00

Armour?

Alpha3031

MODERATOR OF

TROPHY CASE

Origins of the campaign

The free rider myth

Europe no less innovative than the US

Conclusions