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July 10, 2024
David Burda
Economics Outcomes System Dynamics

Ground Fresh Chili Paste Is Back, and So Is My Faith in Market-Based Healthcare Reform

I admit it. I had my doubts. But in the end, I was right.

About a year ago, I wrote about my favorite brand of Asian hot chili paste disappearing from grocery store shelves not only where I live but around the country.

The company that produces Sambal Oelek stopped making the “ground fresh chili paste” because of a serious supply chain issue — a shortage of chili peppers. If you know the brand, it comes in an 8-ounce plastic jar with a gold label and a green lid. Yahoo News wrote about it in this story in 2022. We were well-stocked, so we didn’t notice the shortage until more than a year later.

As a result, I bought about a dozen jars on the black market, i.e., eBay and Etsy. I paid $25 a jar, when it used to sell for about $3 a jar at our local grocery store. Needless to say, we have used it sparingly since then as it’s probably the most expensive thing we own on a per-ounce basis.

I cited that supply-and-demand lesson to argue that shortages of prescription drugs are driving up drug prices because healthcare markets operate the same way markets do in any other industry.

“If you believe that market-based solutions work, and I do, both the shortages of Samba Oelek and drugs will resolve themselves. Someone will start growing more hot peppers, someone will make a tastier hot chili paste or someone, like me, might start growing their own peppers and make their own chili paste. Just like someone will start manufacturing more pills, develop a more effective drug, or bring back drug manufacturing to the U.S. to avoid geo-political disruptions,” I wrote.

Guess what? Samba Oelek is back. On July 5, I accompanied my wife to our local grocery store after she figured out that I was pretending to work when pretty much everyone I work with was off that day. As I pushed the cart down the aisle, I looked down, and on the second shelf up from the floor was our favorite plastic jar with a gold label and green lid. It was on sale for $3.99 a jar. We bought two jars.

We probably should have bought more because the company that makes Samba Oelek stopped making its signature sriracha sauce until after Labor Day because of pepper supply chain issues, as this piece in USA Today said.

The fact that Samba Oelek reappeared at virtually the same price point as before makes me believe that market-based solutions will correct drug shortages and lower drug prices because markets are markets regardless of the industry. That is, if the Federal Trade Commission and the antitrust division of the U.S. Justice Department get off their ass and make sure drug markets function like real markets.

That’s a big if, as I wrote in this blog post, “Health Insurance and Drug Company Execs Must Be Chuckling Over Antitrust Enforcement of Providers.”

Until then, pass the ground fresh chili paste.

Thanks for reading.

About the Author

David Burda

David Burda began covering healthcare in 1983 and hasn’t stopped since. Dave writes this monthly column “Burda on Healthcare,” contributes weekly blog posts, manages our weekly newsletter 4sight Friday, and hosts our weekly Roundup podcast. Dave believes that healthcare is a business like any other business, and customers — patients — are king. If you do what’s right for patients, good business results will follow.

Dave’s personnel experiences with the healthcare system both as a patient and family caregiver have shaped his point of view. It’s also been shaped by covering the industry for 40 years as a reporter and editor. He worked at Modern Healthcare for 25 years, the last 11 as editor.

Prior to Modern Healthcare, he did stints at the American Medical Record Association (now AHIMA) and the American Hospital Association. After Modern Healthcare, he wrote a monthly column for Twin Cities Business explaining healthcare trends to a business audience, and he developed and executed content marketing plans for leading healthcare corporations as the editorial director for healthcare strategies at MSP Communications.

When he’s not reading and writing about healthcare, Dave spends his time riding the trails of DuPage County, IL, on his bike, tending his vegetable garden and daydreaming about being a lobster fisherman in Maine. He lives in Wheaton, IL, with his lovely wife of 40 years and his three children, none of whom want to be journalists or lobster fishermen.

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