My comment on Bryan Young's "Is Obama Selling Us Down the River to Big Pharma?"

I posted the following comment to this article by Bryan Young on Huffington Post:

Have you ever asked yourself why drugs are cheaper in Canada and other socialized medicine countries, and the ramifications of this for drug costs in America? Basically, the socialized medicine countries are using us and taking us to the cleaners. They all have monopoly bargaining power and essentially dictate prices. The drug companies could never recoup costs if they had to sell to everyone at those prices, so they make it up in the American market. So basically the good old USA is subsidizing the drug costs for the rest of the world. Here is a blog post from a few years ago that explains this:

http://nolan.eakins.net/BlameCanada

Finally, drugs account for only 10% of overall health care costs, but they happen to be the one that is the most visible to people (since they often have to regularly pay a co-pay out of pocket for them) whereas other costs are unseen behind the scenes and paid by insurance but relatively larger. Pharma can be an easy target and scapegoat, but there are bigger fish to fry in reducing health care costs. So maybe the Obama administration is actually wise in this --- they are getting some signficant cost concessions and also, maybe more importantly, the backing and muscle of the pharma industry in helping to wrest savings out of the rest of the 90% health care pie.