Report Questions Industry Argument on High Drug Prices

As Congress and president Trump pledge to address skyrocketing drug costs, a new report by consumer advocacy group Public Citizen calls into question industry arguments that pricing reflects the high cost of research and development to bring new therapies to market. The 20 largest pharmaceutical corporations “collectively profited more than $100 billion each year for three consecutive years (2013 to 2015) while self-reporting spending about half that amount on research and development (R&D) for new medicines,” the Public Citizen report says.

“Even the inflated estimates of R&D reported by the industry are dwarfed by the industry’s profits, which, for the 20 largest pharmaceutical companies, jumped from $100.5 billion in 2014 to $123 billion in 2015 – more than 22%,” the group says. “With top companies profiting an average of $5 billion each per year, the industry has ample resources for developing medicines with protections to prevent them from being priced out of reach for the people who need them... Prices are not related to R&D costs. The public puts in $30 billion of our own every year for biomedical research through the taxpayer-funded National Institutes of Health. We deserve affordable medicines in turn.”