Big Pharma

A July 12, 2001 report issued by Families USA, a Washington, DC-based healthcare consumers' group says that leading pharmaceutical companies spend more than twice as much on advertising and marketing as they do on research.

Consumer group's arguments to curtail skyrocketing drug costs often come up against arguments from the drug industry that any effort to curtail these profits will cause fewer dollars to be available for research.

The report says that this argument doesn't hold water since the drug companies are not spending current profits on research, choosing instead to spend more than twice the amount on expensive direct-to-consumer advertising than they do on research. The report, based on information from the drug companies own financial disclosures to the Securities and Exchange Commission (SEC), also says that the largest drug companies continue to pay their top executives tens of millions per year. They also typically sell the same products in other countries for much less than they do in the U.S.

In 2000 Pfizer, Inc. reported $30 billion in revenues. 39% of that was spent on advertising, marketing and administration. Only 15% of revenue went to research and 13% went to profits. Chairman William C. Steere was paid more than $40 million in salary and bonuses in 2000.

The industry is hiding behind research and development as a way of increasing prices and therefore increasing profits," said Ron Pollack, executive director of Families USA. "The research and development mantra they use is clearly extremely misleading."

The Facts About PHARMACEUTICAL Companies
Americans pay some of the highest drug and health care costs in the world. Why?  It's widely assumed that it's because of research costs and better quality drugs.  Not so.  Big Pharma appears to answer to no one as the costs continue to soar.
THE REAL COST OF DRUGS:
Drug	Consumer Price	Cost of Active Ingredients	Markup
Lipitor (20mg)	$272.37	$5.80	4,696%
Claritin (10mg)	$215.17	$0.71	30,306%
Prilosec (20mg)	$360.96	$0.52	69,417%
Xanax (1mg)	$136.79	$0.24	568,958%
Prozac (20mg)	$247.47	$0.11	224,973%
Zoloft (50mg)	$206.87	$3.20	11,821%
TOP TEN BIG PHARMA COMPANIES:
COMBINED PROFITS: $35.9 BILLION
IN THE U.S. THE COST OF PRESCRIPTION DRUGS RISES 12% EVERY YEAR.  THAT'S ABOUT $200 BILLION A YEAR.
	DRUG COSTS IN 2010 ARE 3 TIMES WHAT THEY WERE IN 1980.
MANY DRUGS APPROVED BY THE FDA ARE KNOWN AS ME-TOO DRUGS.
	THESE DRUGS ARE COPIES OF SUCCESSFUL EXISTING DRUGS WITH ONLY MINOR ALTERATIONS
ME-TO DRUGS ONLY NEED TO BE SLIGHTLY MORE EFFECTIVE THAN A PLACEBO.
WHY ARE AMERICAN PHARMACEUTICALS SO MUCH MORE EXPENSIVE?
NO CAPS ON PRICES OF PRESCRIPTIONS	THE U.S. HAS A 20 YEAR PATENT LAW	UNTIL THE PATENT ENDS, NO GENERICS CAN ENTER THE MARKET. GENERICS ARE OFTEN 80% CHEAPER.
AMERICAN SENIOR CITIZENS ARE POSSIBLY THE MOST AFFECTED BY EXPENSIVE DRUGS.
			90% OF SENIORS TAKE PRESCRIPTIONS COSTING $1,500 A YEAR
		ONE IN FOUR SENIORS SKIP DOSES TO REDUCE THEIR COST.
CONFLICT OF INTEREST: STUDIES SUGGEST THAT MORE THAN 25% OF DOCTORS RECEIVE MONEY FROM BIG PHARMA TO HELP MARKET THEIR DRUGS.
MOST MONEY IS SPENT ON ADVERTISING AND NOT RESEARCH AND DEVELOPMENT.
IN 2008 RESEARCHERS FOUND THAT TWICE AS MUCH MONEY WAS SPENT ON ADS THAN ON R&D.		MOST PEOPLE ALSO DON'T REALIZE THAT BIG PHARMA BUYS RESEARCH DONE BY UNIVERSITIES AND BIOTECH COMPANIES INSTEAD OF DOING IT THEMSELVES.