Recent coverage of the analysis in POLITICO noted, “Out of every dollar, the analysis found that the top 10 largest brand-name pharmaceutical manufacturers spend 19 cents on advertising, selling, general and administrative costs; 9 cents on corporate overhead; 18 cents on research and development; 25 cents on production costs; and 4 cents on taxes. The remaining 25 cents goes toward profits, which includes money spent on shareholder dividends and stock buybacks, as well as profits banked by the company.”
The analysis also shows that, since CSRxP last conducted its “Big Pharma Dollar” study in 2019:
- The share of each dollar of Big Pharma revenue going to profits increased from 18 cents to 25 cents.
- The share dedicated to R&D declined from 22 cents to 18 cents.
- The share dedicated to paying U.S. taxes fell from 10 cents to four cents.
- Spending on advertising, selling, general and administrative expenses remained at 19 cents, despite rising scrutiny of Big Pharma’s staggering spending on often misleading marketing practices directly targeting consumers.
- Spending on corporate overhead remained at nine cents.
“Big Pharma routinely opposes bipartisan, market-based solutions that would effectively lower prescription drug prices for the American people by claiming they would undermine innovation, but the brand name pharmaceutical industry’s own financial data tells a different story,” said CSRxP executive director Lauren Aronson in a statement on the new analysis. “Brand name drug companies now dedicate three times more of each dollar of revenue to profits, advertising and overhead than to researching and developing new treatments for patients.”
Read more on the analysis HERE and HERE.
Read more on how Big Pharma’s innovation rhetoric doesn’t hold up to scrutiny HERE.
Read more on bipartisan, market-based solutions to hold Big Pharma accountable HERE.
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