http://www.commonwealthfund.org/publications/blog/2016/jul/value-based-drug-pricing

What would penicillin cost under value-based pricing, a system in which drug makers set prices based on the benefits of their products to consumers and the larger society, rather than drugs’ costs of production? Penicillin has saved millions of lives since its first use in 1942, and it still works for many patients despite growing bacterial resistance to the drug. (Fortunately, many fewer patients get infections with pneumococcus now because we have a good vaccine for it.) Surely, under value-based pricing, penicillin would sell for thousands or tens of thousands of dollars a dose.

Medicine depends on many cheap generic drugs like penicillin to treat conditions as diverse as acne, gout, hypertension, heart disease, and cancer. Pricing these drugs according to their value would make them unaffordable to uninsured and underinsured patients and dramatically increase the aggregate costs of pharmaceuticals.

There is a compelling superficial logic to value-based pricing. Why shouldn’t manufacturers charge the full value of the products they produce? Why shouldn’t consumers have to pay it? That logic begins to fray, however, when you think about how other markets work in our capitalist system.