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The Truth About The Drug Companies Marcia Angell


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The Truth About The Drug Companies

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The Truth About The Drug Companies Marcia Angell

  1. 1. The Truth About the Drug Companies Marcia Angell, M.D.
  2. 2. WORLD’S TOP 10 DRUG COMPANIES AND PRESCRIPTION DRUG SALES 2008 Total: 5 American, 5 European, $310 billion Source: IMS Health “Top 15 Global Corporations”, accessed 8/27/09
  3. 3. *FORTUNE 500 U.S. DRUG COMPANIES 2008 SALES AND EXPENSES Billions Average drug company profits 18% v. 0.9% for all Fortune 500 industries *Johnson&Johnson, Pfizer, Abbott, Merck, Wyeth, Bristol-Myers Squibb, Lilly, Schering-Plough, Amgen, Gilead Sciences Source: Fortune 5/4/09; company annual reports (31%) (15%) (18%)
  4. 4. New Drug Approvals 2000-2007 (8 years) 667 new drug approvals Only 75 (11%) were both NME’s and improvements
  5. 5. Innovation: Published Research Leading to Drugs Sources: Internal NIH document available from Public Citizen; also Zinner, Health Affairs, Sept-Oct 2001; also Boston Globe 4/5/98
  6. 6. $55 BILLION Source of picture: Cover of An Elephant in The Living Room: The Children’s Book by Jill M. Hastings, M.S. and Marion H. Typpo, Ph.D.
  7. 7. What’s The Elephant Up To? <ul><li>Lobbying </li></ul><ul><li>Political contributions </li></ul><ul><li>Front groups (patient advocacy and policy organizations) </li></ul><ul><li>Gifts to institutions (medical schools, community and cultural organizations) </li></ul><ul><li>“ Education” of doctors </li></ul><ul><ul><li>CME </li></ul></ul><ul><ul><li>Professional societies </li></ul></ul><ul><ul><li>Medical conferences </li></ul></ul><ul><ul><li>Educational materials </li></ul></ul><ul><ul><li>Gifts, meals, and junkets </li></ul></ul><ul><ul><li>What doctors learn: </li></ul></ul><ul><ul><ul><li>Drug-intensive style of medicine </li></ul></ul></ul><ul><ul><ul><li>Expensive new drugs better </li></ul></ul></ul><ul><ul><ul><li>Expanded indications </li></ul></ul></ul>Patients pay 20% mark-up on drug prices.
  8. 8. <ul><li>Mission of Academic Medical Centers </li></ul><ul><ul><li>Educate the next generation of physicians </li></ul></ul><ul><ul><li>Perform cutting edge research </li></ul></ul><ul><ul><li>Care for the sickest and neediest members of society </li></ul></ul><ul><li>Mission of investor-owned companies </li></ul><ul><ul><li>Maximize value of shareholders’ stock </li></ul></ul>
  9. 9. The Pharmaceutical Industry and Health Reform <ul><li>Health reform will be a windfall – more customers </li></ul><ul><li>Obama’s promise to PhRMA: </li></ul><ul><ul><li>Medicare will not regulate prices </li></ul></ul><ul><ul><li>Importation from Canada will remain illegal </li></ul></ul><ul><li>PhRMA’s promise to Obama: $8 billion per year in discounts </li></ul>