March 31, 2017
Pharmaceutical Industry Profits Exceed R&D Costs in 2013, 2014 and 2015
As Industry Fights Affordability, Pattern of Profitability Shows Struggling Patients Suffer Needlessly to Satisfy Big Pharma Greed
WASHINGTON, D.C. – The 20 largest pharmaceutical corporations collectively profited more than $100 billion each year for three consecutive years (2013 to 2015), exceeding self-reported research and development (R&D) costs for new medicines, a new Public Citizen report (PDF) released today shows.
A primary excuse the pharmaceutical industry uses for price gouging is the high cost of R&D these corporations pay to bring new medicines to market.
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 $100.6 billion in 2014 to $124.7 billion in 2015 – nearly 24 percent.
“Big Pharma says that high prices pay for R&D, but it turns out more of their revenue is going for profits than R&D investments,” said Robert Weissman, president of Public Citizen. “The pricing system is broken and needs fundamental change.”
Added Peter Maybarduk, director of Public Citizen’s Access to Medicines program, “Corporations abuse their monopoly power to charge people as much as we will pay to care for our loved ones. 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.”