CSRxP ANALYSIS: PHARMACEUTICAL INDUSTRY’S PROFIT MARGINS STILL 10 TIMES GREATER THAN OTHER SECTORS OF DRUG SUPPLY CHAIN
New Report Underscores How Brand Name Drug Companies Ride High on Egregious Pricing Practices and Anti-Competitive Tactics That Are Root Cause of High Drug Prices in America
Washington, D.C. – The Campaign for Sustainable Rx Pricing (CSRxP) today released its latest analysis revealing that the pharmaceutical industry continues to post profit margins 10 times higher than other sectors of the prescription drug supply chain. the updated findings confirm that Big Pharma’s entrenched pricing and patent-abuse playbook continues to drive blockbuster profits at the expense of patients.
“Fueled by egregious pricing practices and anti-competitive tactics, Big Pharma continues to post blockbuster profits dramatically outpacing any other sector of the prescription drug supply chain,” said CSRxP executive director Lauren Aronson. “By gaming the system to block competition, hiking prices at rates outpacing inflation, and setting increasingly out-of-control launch prices, Big Pharma continues to ride high, while too many American patients face challenges affording their medications.”
“Brand name drug companies’ consistently posting profit margins 10 times higher than others in the drug supply chain adds to the overwhelming evidence that pharmaceutical industry opposition to market-based solutions to lower drug prices is about protecting profits, not innovation, and further undermines Big Pharma’s self-serving blame game designed to keep drug prices high,” Aronson continued. “Policymakers must reject Big Pharma’s debunked rhetoric and hold brand name drug companies accountable to effectively lower drug prices for hardworking Americans.”
This latest analysis demonstrates Big Pharma’s cushy profit margin has remained 10 times higher than other sectors of the drug supply chain, consistent with an analysis conducted last year, while the industry has continued to point fingers at others and fought market-based solutions to lower prescription drug prices, falsely claiming they would undermine innovation into new cures.
In the new analysis, pharmaceutical manufacturers’ average annual net income margin stands at 23.2 percent from 2017 through 2024, compared to other sectors including distributors, retail pharmacies, pharmacy benefit managers and health insurers. The data confirms pharmaceutical manufacturers’ lowest single-year margin in 2017 still exceeds the highest margin of any other sector by a factor of four.
Pharmaceutical Manufacturers’ Profit Margins are 10 Times Larger than Other Drug Supply Chain Sectors
