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09 Mar 2020, 08:25
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B
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
45%
(medium)
Question Stats:
68% (02:03) correct
32%
(02:08)
wrong
based on 549
sessions
History
Date
Time
Result
Not Attempted Yet
Currently, prescription drug prices are set by drug companies according to market demands. A new regulation under consider would allow the government to require the drug manufacturers to sell certain drugs at lower prices in exchange of faster regulatory approvals for the drug themselves. This new practice would result in drug companies receiving less revenue per year for each drug available on the market and would therefore impede the development of new medicines.
Which of the following, if true, most strongly suggests that the new regulation favors drug manufacturers long-term economic interest?
A. Prescription drugs are normally purchased on advertising and efficacy and not pricing
B. Regulatory approval takes longer than two years during which time the manufacturer can not recover the heavy cost spent to develop the drug.
C. Two of the most expensive parts of the process by which manufacturers bring drug to market are the testing and approval procedures.
D. Regulation like the one under consideration was first enacted in a country where there is no patent protection for drugs developed for human consumption.
E. The lower prices required by government would still be higher than the prices of generic alternatives.
Source: 800score
Which of the following, if true, most strongly suggests that the new regulation favors drug manufacturers long-term economic interest?
A. Prescription drugs are normally purchased on advertising and efficacy and not pricing
B. Regulatory approval takes longer than two years during which time the manufacturer can not recover the heavy cost spent to develop the drug.
C. Two of the most expensive parts of the process by which manufacturers bring drug to market are the testing and approval procedures.
D. Regulation like the one under consideration was first enacted in a country where there is no patent protection for drugs developed for human consumption.
E. The lower prices required by government would still be higher than the prices of generic alternatives.
Source: 800score
25 Mar 2020, 01:42
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Premise: 1) Currently drug prices ~ market demands. A new regulation : drugs at lower prices in exchange of faster regulatory approvals for the drug themselves.
Conclusion: This new practice would result in drug companies receiving less revenue per year for each drug available on the market and would therefore impede the development of new medicines.
Which of the following, if true, most strongly suggests that the new regulation favors drug manufacturers long-term economic interest?
Prethink : To support this long-term economic interest- relate to Faster regulatory approvals
A. Prescription drugs are normally purchased on advertising and efficacy and not pricing : Out of scope
B. Regulatory approval takes longer than two years during which time the manufacturer can not recover the heavy cost spent to develop the drug. --> Correct in line with prethinking.
C. Two of the most expensive parts of the process by which manufacturers bring drug to market are the testing and approval procedures. : How Faster approval will help? cost cud be same after regulation.
D. Regulation like the one under consideration was first enacted in a country where there is no patent protection for drugs developed for human consumption.: Irrelevant
E. The lower prices required by government would still be higher than the prices of generic alternatives. : Irrelevant
Conclusion: This new practice would result in drug companies receiving less revenue per year for each drug available on the market and would therefore impede the development of new medicines.
Which of the following, if true, most strongly suggests that the new regulation favors drug manufacturers long-term economic interest?
Prethink : To support this long-term economic interest- relate to Faster regulatory approvals
A. Prescription drugs are normally purchased on advertising and efficacy and not pricing : Out of scope
B. Regulatory approval takes longer than two years during which time the manufacturer can not recover the heavy cost spent to develop the drug. --> Correct in line with prethinking.
C. Two of the most expensive parts of the process by which manufacturers bring drug to market are the testing and approval procedures. : How Faster approval will help? cost cud be same after regulation.
D. Regulation like the one under consideration was first enacted in a country where there is no patent protection for drugs developed for human consumption.: Irrelevant
E. The lower prices required by government would still be higher than the prices of generic alternatives. : Irrelevant
22 Sep 2020, 00:25
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Hi,
Can anyone please elobarate on why B is the correct answer?
Isn't B supporting the idea that drug manufacturer income will be less? We have to show that new regulation favors drug manufacturers long-term economic interest ryt? Then how is B the correct answer?
Can anyone please elobarate on why B is the correct answer?
Isn't B supporting the idea that drug manufacturer income will be less? We have to show that new regulation favors drug manufacturers long-term economic interest ryt? Then how is B the correct answer?
13 Jan 2021, 02:06
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Ravs113
Hi,
The Conclusion drawn in the argument is that the company will make less revenue every year for getting the approvals quickly. If the drug gets approved quickly and if the cost of the gestation period can be covered by selling the drug for lesser rate then the drug manufacturers long term economic interest can be protected.
The Answer says:
Regulatory approval takes longer than two years during which time the manufacturer can not recover the heavy cost spent to develop the drug.
If looked at the answer in the opposite way it says that to start recovering heavy costs it is better to start selling the drug at the earliest, even if at a lesser rate.
