Which is scary, since Big Pharma has announced price increases on some of its most popular and most prescribed meds in America.
Major drug makers such as Pfizer, Gilead Sciences, and Purdue announced they are increasing prices on 460 meds by an average of 5 to 6 percent. As well, these price boosts will have drugs like the HIV drug called Biktarvy, the breast-cancer treatment named Ibrance, the heart-failure treatment named Vyndamax, and even the painkiller Oxycontin. All those will get price boosts of up to 7 percent.
This year the new prices are more or less in line with the huge 6.8 percent inflation people are seeing at the pump and the counter last year, but a lot of last year’s price increases were not. And neither were there price increases before that. A report from the Institute for Economic Review discovered that in 2020, drug makers did this same thing, increasing prices and costing Americans another $1.67 billion at pharmacies.
The companies of concern say the are doing this not only because their prices are going up (the reason every other company out there says they are raising prices), but to pay for research into new meds.
“The modest boost is needed to support investments that allow our company to continue to research new medicines and offer those breakthroughs to people who need them,” a Pfizer spokesman said, as reported by Axios.
That sounds great, but it’s not really how normal firms finance R&D (often they will raise more capital, or borrow the money, or take the money out of their existing line items).
Second, it is against AbbVie – a drugmaker that had attracted the attention of the U.S. Congress and which makes the anti-inflammatory drug named Humira – hit patients with a large 7.4 percent price boost when the American economy was experiencing under 2 percent inflation. And their explanation was not inflation or even R&D. Rather, they said it was to make up income they had lost because of less drug usage within the first year of coronavirus. Previously, AbbVie had increased the price of Humira by 470 percent since the year 2003.
Was that for R&D?
Nope. Its CEO’s bonus were connected directly to the sales of the Humira drug, which also happens to be the highest-selling meds in America. AbbVie brought in $16 billion in 2020 from just Humira alone. R&D makes a useful talking point sometimes, but so does inflation.