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Monday, February 12, 2018

Hepatitis C: We Pay More, Thank God

This is a popular meme floating around the Internet. Sometimes it picks India, sometimes Egypt, but the idea is the same. The US pays 84 times or 250 times or some ungodly percentage more than these lousy third world countries! Why are US citizens being gouged?

Well, to put it bluntly, US citizens are NOT being gouged. When all things are considered, those prices are all pretty fair. To begin with, let us simply accept the numbers above without argument. For this analysis, we shall add some numbers of our own.

Country  Price / pill  % of US cost Median Income  % of US Income  Hep C Prevalence 
 USA  $1000  100%    $51,700   100%   3.2 million
 Egypt  $    11      1%    $  5,680     11%   38 million
 India  $      4      0.4%    $  3,800       7%  10-15 million

So, the average American earns 10x as much as the average Egyptian and roughly fifteen time as much as the average Indian. One would think, based just on this, that the average Egyptian treatment would cost one-tenth as much. That is, it would seem the price should be $100 per pill in Egypt, for instance.

But, then we have to factor in the prevalence of the disease. Egypt has 10x as many cases of hepatitis C, India has 3-5x times as many cases of the disease. So, we have to knock down the Egyptian price by another factor of ten (due to volume) and lo! The price is pretty much correct. When you factor in both India's disease prevalence and income, even the Indian price is not that far off.

There's no reason to stop with the table above, though. Try factoring in the sub-populations that actually get infected with hepatitis C and therefor have to pay these different prices. The "disparity" becomes even more interesting.

In the United States, hepatitis C is primarily the scourge of IV drug users and, to a lesser extent, homosexuals. Homosexuals tend to be richer than the average American. They are narcissists who have no children, and who claw their way up the corporate ladder quite efficiently, that is, they tend to get paid more. Conversely, in Egypt and India, hepatitis C most adversely effects the poorest of the poor. It is the poor in these countries who are the least likely to have access to clean water.

So, let's summarize those numbers with fresh eyes. In general, American IV drug users and homosexuals are subsidizing the medical treatment of the poorest of the poor in the Third World.

Personally, I can find no reason to object to this arrangement.
Can you?

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