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Big Pharma’s New Year’s Resolution: Raise Drug Prices

Happy New Year, to start off! Best wishes for 2023.

This January, a host of pharmaceutical companies based in the US  – including Pfizer and AstraZeneca – plan to raise the prices on more than 350 different drugs. Pharmaceutical companies have a history of hiking their prices at the beginning of the year, and this year will be no exception.

GSK will increase the price of its shingles vaccine by 7%, Pfizer will raise the cost of its autoimmune disease treatment Xeljanz by 9%, and AstraZeneca will increase the cost of its blood cancer treatment Calquence by 3%.

The pharmaceutical companies, naturally, claim that all of these price increases are to keep up with inflation. But that doesn’t explain the fact that prescription drug prices are already 250% greater in the US than in other developed countries. For brand name drugs, US prices are 340% more than the prices of the same pharmaceuticals in developed countries.

To this point, pharmaceutical companies would respond that Americans pay so much for drugs so that future advances in research can be funded. Let me explain why this is false.

The foremost mission of pharmaceutical companies is not to create drugs that improve people’s lives. Before all, their first goal is to generate profit for shareholders, since they are for-profit companies. Now, to generate profit, one could create a product that actually has a new and positive impact against an illness and is far superior to anything on the market. Or, one could simply create a drug that is chemically slightly different from anything on the market to get a patent, and then falsely advertise this drug as a huge improvement. The second option, of course, is far cheaper. What do you suppose a profit-driven company will choose to do most of the time?

That is why several analyses have come out in recent years showing that most new drugs released onto the market have no added benefit over what is currently available. Pharmaceutical companies skew studies to disguise the fact that their products aren’t any better than those already on the market. Since peer reviewers in journals aren’t usually able to see the original trial data, and the journals often depend on funding from the pharmaceutical companies, it’s easy to get away with.

Take Humira for instance, which used to be America’s (and the world’s) best-selling drug until the COVID vaccines took its place. Humira is used to treat rheumatoid arthritis, and treatment using this drug costs about $72,000 a year. Methotrexate is an older anti-inflammatory drug that used to be used to treat rheumatoid arthritis. It costs about $480 for a year of treatment. This compound does the same thing as Humira and has the same side effects, based on a portion of the FDA’s own data. Yet Humira is prescribed far more often.

For all that pharmaceutical companies claim they need to make profits for researching new drugs, most spend far more on marketing than they do on R&D. The US is one of the only countries that allows direct-to-consumer drug advertising.  Furthermore, American taxpayers fund quite a bit of the basic research that Big Pharma then reaps profits from. Subsequently, taxpayers are charged again when the drugs are sold back to them at steep rates.

In the quest for more profits, pharmaceutical companies will not hesitate to lie about the dangers of their products. In 2016, Pfizer reached a $486 billion settlement for lying about the harmful side effects of its pain-relieving drugs Celebrex and Bextra. And let us not forget Merck’s Vioxx, which killed as many as 60,000 Americans through heart attacks and strokes. Once again, the company knew about these dangers prior to releasing the product onto the market.

The real reason why drug prices will rise in January is simple: pharmaceutical companies want to make more money, and the American healthcare system allows them to charge exorbitant rates to taxpayers. Meanwhile, politicians do symbolic gestures for taking care of the pricing issue, but do not strike at the root of the problem.

For more information about corruption and deception within the pharmaceutical industry, I would highly recommend the book Sickening: How Big Pharma Broke American Health Care and How We Can Repair It by Dr. John Abramson.


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