Making Fortunes from Misfortunes
A prescription for high bottom lines in the pharmaceutical industry
My name is David, I am 38 years old, and I cannot pay for the medicine I am prescribed. There are many people in this exact situation. Thankfully, my medications are only for a mental health condition. There are people across the country that have health issues so severe that they require prescriptions to survive. And many of them can’t afford the price that pharmaceutical companies have attached to their survival.
According to kkf.org, 24% of people in America either have difficulties paying for their medications or can’t afford them at all. That’s roughly 78,975,580 people that aren’t able to get the care they need to allow them to live without worrying about their health because of dollar signs.
The prices set for prescription medicine in the United States are nothing more than the greed of pharmaceutical companies, their executives, and their shareholders.
“Profit from misfortune leaves room for corruption.”
Let’s take a look at some of the more expensive medications in the United States.
- Luxturna, which can return sight to children that are born with a rare retinal disease, costs $425,000 per eye, according to CNN.com.
- Actimmune is a drug that may help boost the immune system in patients with Chronic Granulomatous Disease. According to the same article at CNN.com, it costs $52,321.80 every month.
- Revlimid is used to treat blood cancer, and author Stacie Dusetzina, a professor at Vanderbilt University’s Department of Health, said it costs about $20,000 a month.
Those are three examples of medication where the pharmaceutical companies have shown that money is the most important thing on their agenda. A report from U.S. Senate Committee on Homeland Security & Governmental Affairs explains, “Although 48 million fewer prescriptions were written for the top 20 most commonly prescribed brand-name drugs for seniors between 2012 and 2017, total sales revenue resulting from these prescriptions increased by almost $8.5 billion during the same period.”
There is no excuse or even a logical reason for prescription drugs to be so expensive. Some pharmaceutical companies claim the profit from high-priced drugs goes into research to develop more sophisticated medications in the future, but there is no evidence to support this claim.
Living with no hope
My condition isn’t as bad as what many others find themselves facing every day. I suffer from bipolar disorder paired with symptoms of psychosis, such as persecutory delusions. The medication I depend on the most for this severe symptom is Latuda. Sunovion Pharmaceuticals Inc manufactures Latuda.
I am unable to leave my house without this medication. I am unable to work, and I haven’t yet been approved for disability. Insurance for a single man of my age costs roughly $350 per month. If I can’t afford to pay for insurance, how would I be able to pay the $2621.72 that a one month supply of Latuda costs me? There are things like GoodRX that lower the price to around $1,200 for a month’s supply, but it might as well raise the price to $435,875 because I can’t afford it either way.
Do you remember the drug commercials on TV that include statements like, “If you can’t afford your prescriptions, Random Pharmaceuticals may be able to help.”? You might say, “It sure is kind of the pharmaceutical companies to drop their prices for individuals who can’t afford those expensive medications.” Well, let me tell you the truth involving this.
Pharmaceutical companies get rewarded for robbing you. Drug Companies receive subsidies for lowering their purposefully over-inflated prices. They know they will be given tax cuts for the amount they report as a loss caused by reducing their costs.
We need to eliminate profits from the entire healthcare scenario. There is no reason why someone should profit from healthcare. Profit from misfortune leaves room for corruption. I am aware that companies must make some money to be able to continue with the study and the production of new drugs. But, that doesn’t mean that the executives should make what they do.
Here you can see that the 2018 salary for 5 of the executives of Pfizer ranged from $7.1 million to $19.6 million. Interestingly, they all received bonuses and incentives from $1.3 million to $3 million.
According to fiercepharma.com, “…since 2010, Pfizer has returned $110 Billion to shareholders in repurchases and dividends.” And that is “…even though the company sustained $27 billion in lost sales of drugs that went off patent, including its cholesterol blockbuster Lipitor and erectile dysfunction med Viagra.”
That means that there was a $27 billion loss because Lipitor and Viagra went from being patented to unpatented leaving other companies with the right to make generic versions. This caused Pfizer to lower their prices. But they were still making a profit, even after reducing their costs to a $27 billion drop in sales. This is a perfect example of the overpricing of pharmaceuticals.
The $3 million that the CEO of Pfizer, Ian Read, received as a bonus in 2018 was an incentive paid for ensuring that profits continued to increase. Matthew Herper, a journalist for Forbes, said, “34% of Pfizer’s revenue growth over the past three years has come from increasing prices on existing drugs…”
Don’t blame inflation
When you take a look at America and examine wages compared to the cost of living, you will see a huge problem. Our society is built on a system of debt. I have a few examples to show that it isn’t just natural inflation.
If you look at the housing market over time, you will see something shocking. Let’s take a trip back in time. We are going to go back to the time of Bing Crosby and Bob Hope. We are going to 1940.
According to this article on cnbc.com, the average house in 1940 cost just $2,938. If you move forward 40 years, you would see that the average home in 1980 cost $47,200. Now, we know that inflation is to blame, but when you adjust for inflation, changing both numbers to represent today’s dollar value, you will see the problem.
Using the inflation calculator at in2013dollars.com, you will discover that the value of $1 in 1940 is equal to $18.33 right now in 2019. So, the house that cost $2,938 in 1940 would cost $53,840.53 today. Then why is the average price for a home as of July 2019 ringing up at $312,800, according to census.gov? Interesting, isn’t it?
When looking into this matter, we must look at wages throughout the years to see if they have grown at the same rate as the costs of housing and medication. On epi.org, I found this piece, where a study states, “When it comes to the pace of annual pay increases, the top 1%’s wages grew 138% since 1979, while wages for the bottom 90% increased by only 15%… If the wages of the bottom 90% grew at the same pace over this period, then the wages of the bottom 90% would have grown by 32 percent, more than double the actual growth.”
My prescription for Latuda costs $2,621.72 a month, $31,460.64 a year. That’s $43.70 for each pill. I would have to make roughly $19.85 an hour to be able to afford this one medication after income tax is siphoned from my earnings. That doesn’t mean I could live on $19.85 an hour. It doesn’t include costs of housing, insurance, transportation, food, utilities, clothing, or any other necessity, let alone any comforts. $20 an hour would barely pay for only one of my eight medications.
According to slate.com, the average American household owes $16,000 in credit card debt, $27,000 in auto loans, $48,000 in student loans, and $169,000 in mortgages. Medical bills are often the most substantial portion of a family’s debt. The long-term cost of healthcare is often more than the combined costs of a family’s home, the educations they need to get good jobs, and the cars they use to get to work, so they can earn money that still will not pay for the medications they need.
The Sad Reality
There is no reason for these companies to set the prices of these vital medications so high, other than greed. If the executives cared for their fellow man, they would see that they are essentially killing sick people simply because they don’t earn enough money.
I wonder what Pfizer CEO, Ian Read, would do if he was stripped of his fortunes at the very same time he had the misfortune of being diagnosed with a debilitating ailment.
Would he be understanding of the needs of pharmaceutical executives and shareholders?
Would he think it was okay that he or his loved ones with health issues had to go without something that was desperately needed because someone that sits in an office, making almost $20 million a year made it their sole purpose to raise drug prices as high as possible to ensure they cashed in on the $3 million of incentive bonuses they earn every year by causing undue hardships?
I don’t think he could handle it. I don’t think he’s strong enough to work endless hours at minimum wage to make sure his loved ones could get the medication they needed to survive.
He would probably stand in the doorway of their hospital room and wave goodbye with a smile on his face relieved that he wasn’t the person suffering (more or less what he does now).
I don’t think he would work long hours for hardly any pay even if it were to save his own life. He would sit waiting for death with no hope like the people who are victims of his greed.
