Thursday, March 23, 2017

Iron Fist Business Class

I mentioned in my previous post that the biggest issue I had with Iron Fist wasn't the fight scenes or the slow pacing, but the business decisions. I think this showed ignorance more on the part of the writers than the characters, so I feel that these questionable decisions are worth discussing.

The first one is that Rand Corp has developed a drug that is a cure for a deadly disease. It works wonders, and due to manufacturing efficiencies, they can produce the drug at $5 a dose. Ward Meachum wants to charge $50 a dose. Danny protests that if this drug saves lives, they should sell it at cost. He doesn't seem to realize that doing so doesn't mean they'll break even. It means they'll lose hundreds of millions of dollars. The cost of drugs isn't in the manufacturing. It's in the years of research and development and FDA trials and failed drugs that never made it to market because they didn't make it all the way through the process. That's hundreds of millions of dollars that Rand Corp spent to develop this drug that they won't make back. Money that they won't have to spend on R&D, which the show specifically mentions is something they want to do with the profit, so there won't be any cure for the next epidemic. And yes, maybe at the margins there would have been people who couldn't afford the drug at $50 a dose, but the show even says that the World Health Organization would have subsidized purchase of the drug in poorer regions. And it's not unheard of for drug companies to sell drugs for lower prices in poorer regions in the world, while still making a higher profit in the rest of the world.

In another case, some cancer victims are suing Rand Corp because they believe that the company's chemical plant on Staten Island gave them cancer. The problem is they don't have any evidence. The plant's emissions are all within government limits, and the plant has passed every inspection. As far as anybody can tell, Rand Corp is doing everything it can to run a safe plant. The plaintiffs' only evidence is that 15 people living within a one mile radius of the plant have gotten cancer. Only, wait, how many people live within a mile of the plant? Is 15 cases of cancer a lot for that many? Well, we don't know exactly where on Staten Island the plant is, but according to Wikipedia, Staten Island has a population of 474,588, and a population density of 8,112 people per square mile. So within a one mile radius of the plant, there'd be about 25,000 people. According to this website on cancer statistics, over 450 out of every 100,000 people will be diagnosed with cancer each year. So out of any population of 25,000 people, you'd expect 115 cancer diagnoses. Unless all those people have a specific, rare type of cancer that can be traced to something the Rand plant produces--none of which is even suggested--then if those are the only people with cancer, something in that area has caused an 87% decrease in the rate of cancer. Rand Corp has cured cancer!

I don't blame Danny for not getting this. He spent the last fifteen years in a monastery, and that sort of communal lifestyle typically doesn't operate on capitalist principles or teach basic statistics. But what bugged me is that no one could explain to Danny the simple math of these situations, instead telling him that his ideas were bad business or that they weren't how business worked. Yes, this is true, but he needed to understand why they were bad business, and no one could be bothered to do that--or possibly, none of the writers of the show understood economics any better than Danny did.

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