supply and demand

From Coyote blog:

http://www.coyoteblog.com/coyote_blog/2012/09/how-government-interventions-affect-health-care-supply-and-demand.html

The discussion in the comment section about physician supply (med school admissions, foreign trained md usage) is particularly interesting. My question: where is innovation in the pharmaceutical world actually happening?

Ie: what combination of US/Canada/EU? Is there a way to suss out the numbers?

Paul Rahe discusses the superbug that has hit 6 percent of hospitals in the US, and mentions that there are no antibiotics in the pipeline. Is this due to limited demand? I think of the abandon of the Lyme vaccine in the late 90s... if this is indeed the trend, without free market incentives, I shudder to think about the consequences for those small minorities that have unusual and difficult to treat illnesses, both acquired and genetic.

It is impossible to mandate creativity and innovation. The countries that tried ended up killing millions of their own people (China, Soviet Union,)  Is this the slippery slope that we want to continue to follow?