Quote:
Originally posted by sgtclub
[1]You keep insisting that the markets are not competitive because of the patent/monopoly, but I'm not convinced about that.
[2] Drugs used for the same purpose but under 2 or more patents do compete against one another, even during the monopoly period.
[3]As for arbitrage opportunities, these exist in every market where you have price discrepencies between markets, so long as it is more efficient to buy/import from the other market.
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[1] That, and the extensive regulation/demand subsidization.
[2] true, they do, but my guess is that's the exception not the rule, and, if you want, you can substitute the phrase "duopoly" or "oligopoly" for "monopoly" and nearly the same arguments apply. Price competition is not agressive in any of those circumstances.
[3] Sure, but that's not the point. The point is that the cos. are able to price discriminate. That suggests that arbitrage opportunities are hindered by something, here laws banning reimportation, or just hte practicality of it. Given low transport costs, drug prices would not be so different in different countries absent certain regulatory barriers, which are a market imperfection.
