Ethics of Product Pricing Essay Example | Topics and Well Written Essays - 500 words

Ethics of Product Pricing - Essay Example Two, more common arguments, put forward by these companies are that they need to cover R & D costs and they have to cover the development costs before the product becomes obsolete. R & D costs are those costs associated with manufacture of the drugs, research done to find the cure of a disease and any other costs that are bore by the drug manufacturing companies in order to bring their product in the final shape, one that is presented to the consumers for sale. These costs are often very high and in order to cover those costs products are marked-up with these costs against the expected sales. Similarly, whenever a company develops a product, it saves its rivals from spending on the research and they use the research done by the original developer and enjoy free-riding at the expenses of the first developer. So, firms are forced to cover those costs before the patent expires and rivals start copying the drug. As a result, they charge high price to cover these costs during the time whe n patent is still active. As a result, this behavior is reflected in high prices for the consumers. John Rawl’s theory of distributive justice was based on equity and liberty. It focuses on equal distribution of assets between different members of the community. Rawls also stressed that everything must be done in an act of achieving fairness. He negated the idea that actions of one person should harm another person. This can be related to the pharmaceutical industry in a way that both rich and poor in the society should receive equal health care regardless of their abilities to pay. This will create an atmosphere in the society that will lubricate the process of societal goods in which all will work towards a common aim of doing something good for society. For example, drug companies might share R & D costs, in order to provide good for the consumers or society by providing them cheaper medicines. Similarly, it can also