The Health Jerk
Part Eleven: Basic Economics of the American Health Industry
Hey there, I hope I didn't leave you in too much of a quandary, I know that things look pretty bleak so far, we better move on.
If the marketplace for personal health and wellness products was one million dollars annually, then it would be a cause for concern, but not panic.
The personal health and wellness industry has several niches or product groups. For now we will ignore: over the counter pharmaceuticals and prescription pharmaceuticals. Let’s focus on dietary supplements or nutritional products.Currently it is estimated that the nutritional supplement market is billions of dollars annually. There are dozens of companies which fulfill orders to the tune of hundreds of millions of dollars annually. This is no longer Mike’s Snake Oil that he mixes in his garage.
Basic economics always reflects the supply and the demand for specific products. With this tremendous demand, billions of dollars, it is quite understandable that various levels of government are concerned about the ‘well being of their constituents’. Or maybe, they are planning a strategy to capture some of that money. I don’t want to go ‘conspiracy theory’ on you here, but there seems to be a tie between the government’s associated regulatory bodies …. and …. the pharmaceutical industry. There seems to be a billion dollar lobby in Washington DC related to the pharmaceutical industry. But let’s not go there.
So let’s talk about the market for nutritional supplements.
We have a market with tremendous demand. This market is growing rapidly as the baby boomer generations skew the nation’s demographics. These baby boomer generations have to audacity to actually want to live longer and experience a better quality of life in their later years. This trend will continue to grow as North America continues to recognize alternative medicine as a real alternative to our trauma based North American Health System.
OK, there is a hungry, growing market for nutritional solutions to health issues using nutritional supplements.
OK, there is a hungry, growing market for nutritional solutions to the maintenance of body and spirit.
OK, there is a hungry, growing market for nutritional solutions to our general well being.
OK, there is a hungry, growing market for cures to chronic diseases. We do not want just band aids and we do not want to take government approved drugs with their potential for toxicity and their potential for side effects as bad if not worse than the original health condition. We want to use natural cures and treatments from substances such as herbs, fruits and vegetables.
OK, I think you will grant me that the market is immense, hungry and growing.
Now from the demand side we have:
- Number One - the pharmaceutical companies entering the marketplace aggressively. This is possible because they have a monopoly in the DRUG market. A monopoly created by our federal government and its regulatory agencies like the FDA, FCC and FTC. Their lobby is suggesting that they can legislate a monopoly in the dietary supplement market as well.
- Number Two - thousands of small companies providing home made remedies to all sorts of aches and pains.
- Number Three - dozens of large companies providing tens and hundreds of millions of nutritional products.
I don’t know about you, but I see this as a train wreck about to happen. The government must react for a number of reasons.
- 1.protect the public from dangerous products – good reason
- 2.protect the public from fraudulent products – good reason
- 3.regulate the products offered – maintain control over the health products/services industry – bad reason.
- 4.continue to reap the rewards of a larger bureaucracy – bad reason
- 5.continue to reap the rewards from lobbyists – bad reason.
I do not know what will happen when the dust settles.
In part twelve we will discuss more government interventions into the American health industry and I will start making a prediction of two, maybe even some recommendations.
Later sheep.