Tuesday, April 08, 2008

Pharmaceutical Industry Vs. Doctors

"Sure, the pharmaceutial industry is much more powerful than doctors," my doctor flatly said to me.

She was talking about a weird prescription drug system in Japan. Whatever the manufacturer is, all prescription drugs of the same kind are the same retail price under Japan's health insurance system. But depending on the manufacturer, wholesale prices actually vary. For example, say, company A adopts a very strict standard to check pesticides used for growing plants for herbal medicine, while company B does not conduct such a strict inspection. As a result, company A's herbal medicine's whole sale price is more expensive than company B's. Even so, retail prices of both are the same - which means pharmacies could lose money by selling company A's quality medicine, but company A does not, because it can still charge the more expensive wholesale price to pharmacies whatever the fixed retail price is.

In short, the current system actually discourage doctors to prescribe good, quality, but expensive medicine. I thought the solution may change the retail prices depending on the whole sale prices and let doctors and patients choose....? What do you think?

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