I found this excerpt that might be helpful to our discussion:
The law of demand states that, if all other factors
remain equal, the higher the price of a good, the less
people will demand that good. In other words, the higher
the price, the lower the quantity demanded.
So let's consider a scenario. The drug is available on the market for $100. Will I buy it? Yes. For $1000? Yes. For $10000? Yes. For $100000? Yes. For $1000000? Yes. etc.. For $10000000000? Yes, but I can't afford it. Notice I never said no. The pharmaceutical company, the hospital, and the insurance company said no. I don't see where the "law of demand" enters into the equation.
I can't see how it is possible to shim "supply and demand" into a market where the only decision you make when purchasing is "If I don't purchase it, I will die".
On the other hand, simply through adding a competitor into the mix suddenly both parties need to figure out how to keep costs low so the consumer will pick them over their competitor. The fact that there's competition in the market place is orthogonal to the "law of demand".
In other words, no matter how many competitors exist in the marketplace there will always be the same number of people saying "yes" to the purchase. Exactly the same number of potential customers no matter how many competitors exist in the market. All of whom will purchase it if they can afford it.
So let's consider a scenario. The drug is available on the market for $100. Will I buy it? Yes. For $1000? Yes. For $10000? Yes. For $100000? Yes. For $1000000? Yes. etc.. For $10000000000? Yes, but I can't afford it. Notice I never said no. The pharmaceutical company, the hospital, and the insurance company said no. I don't see where the "law of demand" enters into the equation.
I can't see how it is possible to shim "supply and demand" into a market where the only decision you make when purchasing is "If I don't purchase it, I will die".
On the other hand, simply through adding a competitor into the mix suddenly both parties need to figure out how to keep costs low so the consumer will pick them over their competitor. The fact that there's competition in the market place is orthogonal to the "law of demand".
In other words, no matter how many competitors exist in the marketplace there will always be the same number of people saying "yes" to the purchase. Exactly the same number of potential customers no matter how many competitors exist in the market. All of whom will purchase it if they can afford it.