this post was submitted on 08 Oct 2023
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In the medical device and pharmaceutical industries, this more or less already exists in countries with socialized medicine. It's not as explicit as my formula, but the price of medications and devices are regulated. Industry needs to demonstrate the actual benefit of a new product over a prior product for the system to pay for it, and the price of the product is then set on the basis of the health economic value it brings.
Some say it stifles innovation, but honestly, it eliminates the bullshit minor changes that are only made to continue justifying high prices and exclusivity.
Anyway, I think the "Exodus of industry" argument is an empty threat the shareholder class makes when they feel threatened. A market is a market, and if they want to continue to sell in it, they have to follow the rules, even when they change.
It's always externalized exploitation because they're all multinational corporations.
It's true that many of the big players are based in the US, e.g. Pfizer, J&J, Merck, AbbVie, Abbott, EliLily, etc.
But there are plenty that aren't:
https://en.wikipedia.org/wiki/List_of_largest_biomedical_companies_by_revenue
It's important to note that much of the R&D pharma relies on is publicly funded via academic grants in research carried out at universities. It's not to say that pharma doesn't also carry out clinical research, which of course does carry a cost, but a lot of the development dollars for a given drug are spent well before they make it into pharma's hands.