That’s the title of Charles Hugh Smith’s latest article.
Thanks to decades of gangster films, we all know how gangster capitalism works: the cost of “protection” goes up whenever the gangster wants to increase revenues, any competition is snuffed out, and “customer demand” is jacked up by any means available– addiction, for example.
This perfectly describes the pharmaceutical industry and every other cartel in America. You might have read about the price increase in Acthar gel, a medication to treat Infantile Spasms. (via J.F., M.D., who alerted me to the repricing of this medication from $40 in 2001 to the current price of $38,892.)
The compound first received approval in 1950, and various branded versions have been approved in recent years. Let’s be clear: this medication did not require billions of dollars in research and development, or decades of testing to obtain FDA approval; it’s been approved for use for the past 68 years.
Yes, you read that correctly: a medication that’s been in use for 68 years went from $40 a dose in 2001 to $38,892 today. Don’t you love the pricing? Not a round 38 grand, but $38,892. You gotta love these gangsters!
There’s another related term to describe this form of capitalism: racketeering.That’s what mobsters do–operate rackets.
. . .
Gangster capitalism is the new model of “growth” in America, the model used by every cartel from higher education to Pentagon contractors. Eliminate actual competition, raise prices in lockstep with other cartel members, lobby the government to pay your extortionist prices, and threaten any resisters with severe consequences.
There’s more at the link.
I highly recommend that you click over to Mr. Smith’s blog and read the whole thing. He’s got a graph representing the rise in prescription drug expenditure in the USA over the past couple of decades. It’s grim viewing – and almost all the increase is because of corporate greed such as the case he highlights above.
The question is, what are we going to do about it? Are we simply going to throw up our hands and give up, or will we demand that our elected representatives do something about such naked profiteering? The RICO Act is there for a reason. Why aren’t we using it?
Peter
When profits are this high you can make lots of "campaign contributions" as well as provide funds for "fact finding" missions(vacations)to exotic locals for our esteemed legislators. Expecting the congress to do anything of substance about these guys is like asking them to kill the golden goose. Besides their healthcare is fully paid by us so no worries.
That is why so many people go to Mexico for their medicine.
In the original Food & Drug Act of 1906, there were a number of medications grandfathered into the act as generally recognized as safe and effective. These have been available as generics for decades until recently when the FDA added new requirements that drug makers had to submit the full range of testing and certification like these were new drugs. The result? Most of these drugs vanished from the market to be replaced by more expensive and frankly less effective alternatives. Big Pharma is guilty but so is Big Government.
You know Gangster Capitalism is also the model for all the gentrification taking place in all the major cities.
Instead of government subsidized monopolies we now have corporate co-op monopolies. So much for "letting the private sector take over to run things".
RICO doesn't apply. Ask Popehat (Ken White) about it. Or Google "Popehat RICO" and prepare to enjoy the schadenfreude, lol.
(He gets asked about RICO a lot, because he's a former federal prosecutor. It's a pet peeve of his and it's very funny.) Ken White may have succumbed to a (milder than some, but still noticeable) form of Trump Derangement Syndrome, but his legal analysés are still well worth reading.
Prescription drug pricing is nuts, but then, medical care costs in general are insane. That which cannot continue…won't.
To enlarge on the point that others have made a little, why is it that we rail against big pharma or big oil or big whatever-industry but never rail against the big government that not only enables their behavior, rewards it? It's against the law for government workers to be racketeering, influencing and corrupting, too, but no one ever mentions their role. See what Jerry said at 3:10 PM up there. It takes two to tango.
There's one tiny little intrusion of free market into the medical industry: the rise of doctors who work for a small monthly fee. Every other trace of an open market system has been destroyed, and the socialists are trying to make it worse, not better.
Why are generics for these old drugs not available in the USA????