I've been asked several times what the impact of a Democratic White House might be on Health Care--the unspoken worry being that some form of "socialized medicine" will kill drug company profits, among other things. (Remember, the drugs are the biggest portion, by far, of the health sector in terms of profits and company size.) My response is that (1) while I am in full support of the goal of insurance for every U.S. citizen, I (2) don't think it will impinge on the drug companies beyond some adjustment to their profits. But they certainly aren't going out of business, and (3) other sectors of the health care industry, from device makers to care providers, aren't simply going to disappear.

On the drug front, remember that it can cost billions of dollars in research and development to bring a drug to market. And billions can be wasted. Why would a drug company be willing to risk that kind of money on R&D if the government is going to control their profit potential (unless of course the government wants to subsidize the research as well, which it surely doesn't)? A clear and present example: Pfizer's (PFE) announcement in early Oct. that it would halt the sale of, and cancel any further development of, its inhaled insulin product. That little announcement, that the drug has sold a miserable $12 million worth this year versus projections it could be a $2 billion a year product, took a $2.8 billion hit to Pfizer's pre-tax profits. And if that wasn't enough, last week Eli Lilly announced it was halting trials on a blood-thinning drug that they had hoped would bring in at least $1 billion per year. It's hard to recover all the time and money spent on a drug that, in the end, doesn't pan out. And too much control of drug company activities and profits could kill the R&D spending pipeline. And no one wants to see all the new drugs and profits that go with them coming from companies based in Japan or the U.K.