What is the most profitable of all industries in the country? Before I looked it up I might have said electronics or movies, or maybe even computer games. But no, I won’t keep you in suspense, Dear Reader. It is pharmaceuticals. Here is an excerpt from the Wikipedia page:
“..the pharmaceutical industry is — and has been for years — the most profitable of all businesses in the U.S. In the annual Fortune 500 survey, the pharmaceutical industry topped the list of the most profitable industries, with a return of 17% on revenue.“
The Wiki article also notes that ” . . . the U.S. accounts for almost half of the global pharmaceutical market, with $280 billion in annual sales . . .” For the arithmetically challenged, that is over a quarter of a Trillion dollars a year. How’s that for impact on the pocketbook?
One might ask, what are the most profitable drugs sold by this most profitable industry? I found an interesting little article about that in The Village Voice. It begins by mentioning “ibogaine”, an experimental hallucinogen drug that it says is proven to cure, yes cure, meth and heroin addictions. The author says neither the industry nor the government want anything to do with it. Why not? Because, he says, it is a cure.
When we read that, a light went on. The worst thing for a drug company is a pill you take that completely cures you of your ailment with one dose, right? Where’s the money in that?
So, with that in mind, we thought we’d test Kuehne’s theory, and look at the five most profitable drugs in the United States.
Guess what they all have in common? They never cure you. (Emphasis supplied.)
1) Lipitor (2009 gross revenue: $7.5 billion): Designed to lower cholesterol, Lipitor uses statins to decrease LDL cholesterol and triglyceride levels and increase HDL cholesterol levels. Studies indicate that high cholesterol increases one’s chance for heart disease, the leading health problem in the U.S.
2) Nexium (2009 gross revenue: $6.3 billion): This well-marketed drug decreases the amount of acid produced in the stomach, but it’s not an instant cure for heartburn.
3) Plavix (2009 gross revenue: $5.6 billion): Nobody likes a nasty blood clot, and this drug prevents that from happening, particularly after a stroke or a heart attack. The downside: Plavix increases your chances of small-injury bleeds and, if drinking alcohol, heightens your risk of stomach and intestinal bleeds.
4) Advair Diskus (2009 gross revenue: $4.7 billion): For asthma sufferers, a twice-daily inhaler to reduce the swelling in your respiratory system. Helps keep attacks from being more severe.
5) Seroquel (2009 Gross: $4.2 billion): Rounding out our top 5 is Seroquel, an anti-psychotic drug that treats schizophrenia, severe depression, and bipolar disorder by altering chemical activity in the brain.
So, Dear Reader, what shall we make of this as America’s finances totter on the brink of sliding into default and into Recession or Depression? What role does this play, given that medical-care costs are, as most of my blogging friends seem to agree, central to the fiscal problem? Do you suppose it is significant that president George W. Bush’s Medicare drug prescription plan funneled hundreds of Billions of dollars to the pharmaceutical industry? Do you suppose the pharmaceutical industry has some pretty good lobbyists?
Did you know that the Affordable (Health) Care Act, as originally drafted, contained authority for Medicare (read, the government) to negotiate drug costs directly with companies? That provision was killed by Congress. I see on PolitiFact that industry lobbyists managed to get that changed in return for about $8 Billion a year in fees over the next ten years – a pretty sweet deal if you ask me. Let’s see, $8B compared to $280B in sales. Hmm. Less than 3%. Heck of a deal!
In this post I simply wanted to air some facts about an important element of how medical costs (which are central to the crisis, remember?), are the result of an amoral segment of an amoral industry that, despite its advertising is putting greed ahead of the nation’s welfare. Meanwhile, common and pervasive diseases (like malaria, for example) and needs such as vaccines go begging because there’s not enough profit in them. No, erectile dysfunction drugs provide a lot more bang for the buck. (Say, those don’t cure anything either, do they?)
Why are we subsidizing this corrupt industry through public policy? Do you think that if we had to pay out of our pockets for drugs like those above that we might be searching harder for generics or alternatives? I do. When the true cost of drugs is obscured by Medicare or other insurance we are left like geese ripe for the plucking. And I haven’t even broached how the patent system is abused to make subtle changes to formularies to keep the prices of drugs elevated.
If Congress reads my blog and calls the drug companies’ CEO’s to answer for the issues in this post (it is a blogger’s right to fantasize), I wonder if they will fly in on their corporate jets? Time is money, you know.
Drug costs are merely a part of the medical cost problem, of course. Fees, services, scanners, equipment, hell, band-aids and swabs all cost way too much because the system is broken, as I have posted before. I see no way to fix this system and that is why I have decided that a single-payer government health care system is the only clean solution.
- In Bed with Big Pharma (psychologytoday.com)