In Britain, an Epipen — a simple device that saves lives in the case of severe allergic reactions — costs $70. In France and Germany, roughly the same. In America, it costs $600. But in 2007, it cost in America what it did in Britain, France, and Germany. What happened? A drug company called Mylan bought the rights to it — and then it didn’t just send prices soaring, it uses all kinds of shady tactics to maximize profits from insurance companies and healthcare systems both. How?
Well, what does it cost to “make” an Epipen? Not a whole lot. It’s just a device for delivering a dose of epinephrine. The dose used in it “costs” maybe $1. I put “cost” in quotes because even those numbers are mostly fictional — the marginal cost of producing a basic chemical like this is pennies. In fact, the real problem is that epinpehrine became too cheap to manufacture — so cheap that many producers stopped making it altogether. And so a company like Mylan swooped in, put two and two together: corner the supply, gain a monopoly on the demand side, and hey presto — mega profits.
That’s predatory capitalism — a drug that should cost pennies, if the economy were run a little more sanely, costs hundreds, without any regard for the human possibility that is destroyed. Mylan didn’t create any real value whatsoever, only extracted it, siphoned it off.
Yep. Wealth creators, and wealth aggregators. Profit harvesting mode.