1. Price controls imposed by the government would have the effect of making pharmaceuticals available to more consumers, particularly those in lower income brackets who either cannot afford expensive drugs or who lack insurance to pay for these drugs. In this way, price controls would eliminate medical rationing based only on economics and make more drugs available to more individuals.
On the other hand, government-imposed price controls on the entire drug industry products are not likely to have the long-term desired effect that the government would like. While in the short-term, the supply of drugs is unlikely to be affected, since the price controls would affect drugs already on the market and would be based on current (or recent) prices, the long-term effect would be to shut down, or at least radically constrict, research and development in the pharmaceutical industry. This is because of the high cost of bringing new drugs to market. Pharmaceutical companies not only must pay for the development costs of drugs which are actually introduced to the market (and for which the patent life gives the companies some protection before the drugs are issued in generic form), but also the development costs of drugs which are never introduced to the public. The reasons for not introducing a drug can be many, but generally are attributable to the drug failing to pass the rigorous FDA approval process. Restricting the prices that companies can charge for drugs would result in companies taking fewer risks in the development process in order to keep their costs low and their profits at an acceptable level.
The government might take a lesson from other industries and impose price controls or regulations on some drugs, such as those which directly save lives. Similar regulations are used in the telephone industry, where low-income individuals can receive basic telephone service because it is deemed a necessity. Electric utilities, which...