S T C E P S PRO
It’s Time for Public Pharma Medicare for All would take the profit motive out of insurance; public manufacturing of prescription drugs would take it out of providing care. By Alexander Sammon Medicare for All was perhaps the best policy litmus test for progressive politicians in the second half of the 2010s. Today, it has rarely looked less likely to become law. Insurance industry lobbying groups, in tandem with the Chamber of Commerce, have figured out how to beat back the popular policy’s advance, even in one-party blue states like California. And yet the necessity of excising the profit motive from the American health care system, which continues on its ignominious pace to produce bottom-barrel results at maximal prices, has never been clearer. The COVID-19 pandemic showcased the profound inadequacy of the uniquely privatized and financialized American system, where for-profit (and “nonprofit”) hospitals and for-profit insurance companies teamed up to help the United States secure its worst-in-the-world national death toll while notching one best-ever earnings call after another. Perhaps most egregious of all, pharmaceutical companies like Moderna took public funding for vaccine development, tied up the patents, and converted the greatest public-health crisis and mass death event in 100 years into a 100-year flood of profits. Moderna, which in 2019 posted just $60 million in revenue and didn’t have a product to its name, banked $12.2 billion in profit on $18.5 billion in revenue in 2021; its CEO simultaneously cashed out $400 million in stock during the course of the pandemic. The vaccine payday was just another manifestation of pharma’s sweet deal in the U.S. Much of the research and development for new discoveries is publicly funded, and yet drugmakers charge whatever they want, with exclusive monopoly patent grants. Not content to just enjoy that bounty, those companies work to extend that monopoly period, through slight changes to the treatment 30 PROSPECT.ORG AUGUST 2022
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(known as “patent evergreening”) or even bribing generic companies to not compete (“pay for delay”). As a result, the median net profit margin for large pharmaceutical companies is almost twice as high as other companies in the S&P 500. But it doesn’t have to be like that. The federal government can establish its own drug manufacturing apparatus. The path to redeeming our failing public-health sector, and to extricating the profit motive
from health care in the decade to come should go through the establishment of public pharma. It’s by now commonly known that American drug prices are by far the highest in the world. In 2019, the U.S. spent $1,126 per capita on prescribed medicines; comparable countries spent $552. This is not solely due to exorbitantly priced name-brand pharmaceuticals, which make up just 10 percent of all prescriptions filled. Getting a
