To do that though we'd need to solve the problems of manufacturing bandwidth (for-profit drug manufacturing as it exists now wouldn't work in a patent-free world) and drug discovery (a large amount of which occurs in for-profit environments that seek to file patents). How do you address that in a pure-capitalism system? Drug discovery is incredibly expensive.
My personal preference would be to set a hard time limit on drug patents (insulin is so old that it should have gone generic decades ago, but the drug companies cheat) and ban the government & universities from selling patents/derived patents to for-profit companies (insulin, for example, was one of these cases). A hard time limit makes it possible to manufacture things like generic insulin but companies can still keep developing and monetizing new treatments. I don't think that would probably fix things in the long term though, they'd find ways around it. Banning patents from leaving government/university hands would mean more new treatments would be developed using public funding and then any company could manufacture them and compete on the merits.
There are so many opportunities for drug companies and medical care organizations in general to cheat patients - you don't have the freedom to shop around for alternative prices and quotes if you need an expensive therapy Right Now so that your liver doesn't shut down. How can you protect people in that position just using the Free Market? There have to be regulations of some kind, so which ones?
One popular suggestion lately is to just nationalize health care, because the government can tell pharmaceutical companies what it's willing to pay and if they want to charge 5000% more they can pound sand. It's my understanding that some countries have also just started ignoring patents and manufacturing their own drugs, which seems like another option. Could either of those solve it here, though? Who knows. Likely not as long as lawmakers love drug companies and patents.
Manufacturing is commoditized. The bandwidth exists in the generics factories of India. They're able to retool fast and get out high quality stuff pretty fast.
Discovery is a problem, but GlaxoSmithKline is only $200 billion dollars. The government can easily afford drug discovery grants.
Therapy that involves human beings is tough and I don't think I have an answer. But drugs are different. If I can buy cheap generics from India, I should be able to. If I want, I should be allowed to resell. If the government wants to say "FDA-certified" on some, so be it. For the rest, let the people decide.
By acting like a parody of an evil capitalist combined with a youtuber's penchant for stupid stunts, he's made a lot of people now believe (not without foundation) that all drug pricing is an arbitrary ripoff. He is now in jail for a mostly unrelated securities fraud.
I said insulin and meant insulin. Insulin prices have skyrocketed over the last decades beyond any point of comparison without any significant change in the quality or manufacturing process.
As you say though, this is not true of all drug pricing. However, given we're talking about insulin pumps for diabetics, it's reasonable to assume they'd be priced based on the same philosophy as insulin, no?
Shkreli is a gaudy distraction, the same way Jordan Belfort was a gaudy distraction from much quieter fraud and mislabeled risk.
You're absolutely right to focus on insulin. In addition to the obvious relevance to diabetes pumps, it's the perfect example of how pricing isn't based on high costs of drug discovery or manufacturing. The basic market pattern people expect still holds: newer formulations cost more than older ones. It's just that the older formulations never get cheaper; contrary to all economic logic, their (constant-dollar) prices have risen over time. That doesn't bode well for any other step in the diabetes management process.
Shkreli is just the only one dumb enough to say out loud what other pharma executives keep to themselves. His drug pricing strategy is not unique, unfortunately.
