Press Releases
As Trump and McConnell Refuse to Act, Big Pharma Jacks Up 2020 Drug Prices
Fortune: Average Percent Increase Was “More Than Twice The Annual Inflation Rate For The United States”
Sec. Azar’s former company Eli Lilly increases cost of popular diabetes drug by 6%
AbbVie increases cost of arthritis drug Humira, which directly increases CEO’s bonus
WASHINGTON, D.C. – Today, Patients Over Pharma spokesman Eli Zupnick released the following statement on the recent announcements by highly profitable pharmaceutical companies that they will be increasing their prices on more than 500 prescription drugs, including those for patients with cancer, HIV, diabetes, and asthma, with more price increases still to come.
“Big Pharma CEOs are raking in massive profits, paying themselves absurd salaries and bonuses, paying off their shareholders with stock buybacks and dividend increases – and are still shamelessly raising prices on drugs for some of the most vulnerable patients.
“President Trump and Sec. Azar promised to reduce the cost of prescription drugs but these latest Big Pharma price increases once again make it clear that they have absolutely failed to deliver on that promise.
“This latest round of price increases should be a wakeup call to Senators that they need to push aside Big Pharma lobbyists and the objections of Leader McConnell and President Trump and pass the House-passed Lower Drug Costs Now Act as quickly as possible.”
Background
As Of January 10, 2020, Pharmaceutical Companies Have Raised The Price Of 542 Drugs. [GoodRx, accessed 1/13/20]
Headline: Fortune: “Big Pharma Raised Prices of Several Prescription Drugs on First Day of 2020.” [Fortune, 1/2/20]
Headline: CBS News: “2020 is three days old and drug prices are already jumping.” [CBS News, 1/3/20]
As Of January 3, 2020, Pharmaceutical Companies Had Raised Prices On 445 Prescription Medicines For 2020 – Above The Average Number Of Increases Over Last Five Years. “Novartis AG, Merck & Co Inc and Allergan Plc were among companies that raised U.S. prices on more than 100 prescription medicines on Friday, bringing the tally to 445 drugs that will cost more in 2020, according to data analyzed by healthcare research firm 3 Axis Advisors. That is above the average of 404 drug price increases in the first three days of January over the past five years.” [Reuters, 1/3/20]
Average Percent Increase Was More Than Twice The Rate Of Inflation In The U.S. “The price hikes are almost all below 10%, with the median price increase hovering around 5%, though more price increases could come in the following weeks. . . . It is, however, more than twice the annual inflation rate for the United States, which stood at 2.1% for the 12 months ended November 2019.” [Fortune, 1/2/20]
Headline: Modern Healthcare: “Two blockbuster cancer drugs see New Year price hikes.” [Modern Healthcare, 1/3/20]
AbbVie Raised Price For Humira By More Than 7% For 2020 – Humira Is On Track For $19 Billion In Sales In 2019. “AbbVie raised prices on more than 10 drugs, including Humira, which is on track for sales of about $19 billion for 2019, and newly-launched psoriasis treatment Skyrizi, according to 3 Axis. The list price for those two medicines went up by more than 7%. AbbVie could not be immediately reached for comment.” [Reuters, 1/2/20]
Gilead Raised HIV Drug Prices By 4.9% For 2020; Claimed It Wouldn’t Affect Patient Access. “For its part, Gilead raised HIV drug list prices by 4.9% to “reflect the rising costs of goods and services necessary to produce groundbreaking medicine,” a spokesman said. The company doesn’t anticipate that the changes will affect patient access, and Gilead further supports access programs for HIV prevention and treatment options, he added.” [FiercePharma, 1/2/20]
Purdue Pharma Raised Price Of OxyContin By 5% For 2020. “Purdue Pharma: ⬆️ 5% on its OxyContin painkiller, all while the company sits in bankruptcy court and the Sackler owners dangle billions in public settlement funds.” [Axios, 1/6/20]
2018 CEO Pay + Corporate Profits
Headline: Modern Healthcare: “Pharma profits highest in healthcare.” [Modern Healthcare, 8/1/19]
Revenue, Net Income + Profit Margins Of The Top Five Pharmaceutical Companies By Total Revenue In 2018:
|
Company |
Total revenue |
Net income |
Margin |
|
Pfizer |
$53.7 billion |
$11.2 billion |
20.9% |
|
Novartis |
$51.9 billion |
$12.6 billion |
24.3% |
|
Roche Holding |
$56.9 billion |
$10.5 billion |
18.47% |
|
Johnson & Johnson |
$81.6 billion |
$15.3 billion |
18.75% |
|
Sanofi |
$34.5 billion |
$4.4 billion |
12.8% |
[Modern Healthcare, 8/1/19]
Headline: Fierce Pharma: “AbbVie hands CEO $21M—and a hefty bonus—even as executive pay scrutiny mounts.” [Fierce Pharma, 3/11/19]
Headline: CNBC: “Senate panel grills pharma CEO over executive bonuses and sales of AbbVie blockbuster drug Humira.” [CNBC, 2/27/19]
AbbVie Tied CEO Compensation To Sales Performance Of Humira. “At a much-watched Congressional hearing on drug prices two weeks ago, AbbVie helmsman Richard Gonzalez faced a grilling over his bonus—specifically, that it was pegged to sales of the company’s megablockbuster Humira. After all, price hikes have helped fuel Humira’s spectacular growth. Even after shareholders forced a vote last year on linking incentive pay to price-hike scrutiny, the company kept the Humira metric in place when determining Gonzalez’s 2018 compensation, according to a proxy statement filed Friday.” [Fierce Pharma, 3/11/19]
Headline: Fierce Pharma: “Loyalty pays: Merck CEO Ken Frazier scores 19% raise as he stays past retirement age.” [Fierce Pharma, 4/10/19]
Headline: Fierce Pharma: “Bristol-Myers chief’s early work on Celgene deal helped boost pay to $19.4M.” [Fierce Pharma, 5/1/19]
Headline: Washington Post: “Purdue Pharma, facing thousands of lawsuits and bankruptcy, wants to pay ‘certain employees’ $34 million in bonuses.” [Washington Post, 9/19/19]
Purdue Pharma Paid CEO $9M And Board Chairman Nearly $4M In Year Prior To September 2019 Bankruptcy Filing. “OxyContin maker Purdue Pharma paid its CEO $9 million and its board chairman nearly $4 million in the 12 months before the company’s bankruptcy filing last month, according to recently filed financial documents. Five other board members overseeing the private company were paid a combined $3.7 million over that span. Purdue, a privately held company that usually does not disclose detailed financial information, had to make the information public as a part of its bankruptcy proceedings.” [AP, 10/30/19]
AbbVie, Johnson & Johnson, Pfizer and Vertex Defeated Shareholder Proposals To Urge Companies To Disclose Whether Increasing Drug Prices Funded Executive Bonuses. “Small groups of pharmaceutical industry shareholders have pushed for companies to disclose whether higher drug prices fuel lavish bonuses for top executives. But those proposals were handily defeated. The bottom line: The industry and its largest stockholders are not about to start self-regulating when it comes to drug prices and incentive pay packages. Driving the news: The shareholder proposals failed by large margins at AbbVie, Johnson & Johnson, Pfizer and Vertex. Each company vigorously opposed them. [Axios, 5/29/19]
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