Public Citizen released a report illustrating how the US is a goldmine for pharmaceutical companies. Pharmaceutical companies earn more from Americans who buy 20 best-selling prescription drugs than they do from everyone else in the world combined. No wonder that a new Politico-Harvard poll shows that drug price negotiation is Americans’ top policy priority for Congress right now.
Public Citizen analyzed the financial filings of the pharmaceutical companies manufacturing 20 blockbuster drugs to arrive at its findings. It made clear that higher revenues in the US has nothing to do with the number of prescription drugs we take because we don’t take more drugs than people in other countries. It’s all about drug prices in the US.
Public Citizen’s findings speak volumes as to why Pharma is so opposed to Medicare drug price negotiation. We’re talking $158 billion in total revenue for just 20 drugs, nearly two-thirds (64 percent) of which comes from Americans. To date, Congress has expressly forbidden Medicare from negotiating drug prices, driving up drug costs.
Pharmaceutical company profits would fall tens of billions of dollars a year if Americans paid prices comparable to people in other wealthy countries. That’s looking less and less likely as the Democrats try to pass legislation around drug prices. Perhaps, members will agree to some Medicare drug price negotiation and drug price increases capped at inflation but that’s not at all a done deal.
In the meantime, Americans are forced to pay too high prices for our drugs relative to people in every other country or go without them. Pharmaceutical companies profit handsomely from their monopoly pricing power for brand-name drugs. Insurers and pharmacy benefit managers also make a lot of money off of high drug prices, but pharmaceutical companies earn more.
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