**Read the new report HERE**
Eli Lilly claim: “using all available resources” to fight coronavirus” → Eli Lilly reality: no increase in annual R&D from projections…additional $250M in revenue.
Johnson & Johnson claim: “accelerating [its] research & development” → Johnson & Johnson reality: R&D nearly 10% lower..increasing shareholder dividend by 6.3%
Washington, DC – Today, Patients Over Pharma released a new report based on information released through last week during the earnings calls of major pharmaceutical companies Eli Lilly, Johnson and Johnson, Gilead Sciences, and Pfizer. The report lays out how drug companies talk a big game when it comes to their investments in research and development, but the reality is that they are pouring far more into shareholder dividends and stock buybacks while keeping R&D relatively flat.
This new report is being released as Congress continues to negotiate additional legislation to respond to COVID-19 and as Patients Over Pharma pushes for them to include strong patient protection, affordability, transparency, and anti-profiteering provisions.
“Big Pharma talks a big game about their COVID-19 R&D spending but the reality is that taxpayers have poured hundreds of millions of dollars into research that the drug companies are benefiting from while handing billions of dollars back to their shareholders,” said Eli Zupnick, spokesman for Patients Over Pharma. “These drug companies have an obligation to their shareholders to maximize their profits, which is exactly why Congress has an obligation to the American people to ensure that the COVID-19 vaccines and treatments developed using taxpayer dollars are affordable and accessible to all and don’t just go toward padding Big Pharma’s profits.”
Last week Patients Over Pharma released new polling showing overwhelming public support for government action to ensure drugs developed through taxpayer-funded research are accessible and affordable for every American.
Drug companies have received hundreds of millions of taxpayer dollars to develop COVID-19 vaccines and treatments, while lobbying against any provisions that would ensure that these drugs would be affordable and accessible to every American. In fact, the pharmaceutical industry and their lobbyists not only blocked language that would have prevented Big Pharma from locking up coronavirus vaccines or treatments with multi-year exclusivity and protection from generic competition, they actually managed to slip language into the law that prevents the government from intervening when there are concerns about affordability.
Highlights from new report
- WHAT PHARMA SAYS: Pharmaceutical companies have relentlessly touted their dedication to coronavirus response, both in paid and earned media over recent weeks:
- In a press release, PhRMA stated, “America’s biopharmaceutical companies are working around the clock to . . . Research and develop new therapies and treatments for those infected with the virus.”
- Eli Lilly claimed it was “using all available resources” to fight coronavirus.
- Johnson & Johnson stated it was “accelerating [its] research & development” and “committed to leverage [its] breadth and global scale.”
- Gilead stated it was “committed to putting its resources and research to bear” in the coronavirus fight.
- Pfizer aired a TV ad claiming, “Science … doesn’t back down, it revs up. … We’re taking our science and unleashing it.”
- WHAT PHARMA DOES: In quarterly earnings calls held over recent weeks, pharmaceutical companies have made it clear that they’ve done little to increase their research & development budgets while staying committed to bigger and bigger shareholder dividends and stock buybacks:
- Eli Lilly said it expected annual research & development expenses would not increase from projections made at the beginning of the year while announcing that it had an additional $250M in revenue in Q1.
- Johnson & Johnson’s research & development expenses for Q1 of 2020 were nearly 10% lower than Q1 of 2019. It announced it would increase its quarterly shareholder dividend by 6.3% in Q2.
- Gilead increased its sales, general and administrative spending more than its R&D expenses in Q1 ($46M vs. $44M) while touting a $50M investment in coronavirus R&D. At the same time, Gilead paid out $874M in cash dividends to shareholders and made $1.3B in buybacks in Q1.
- Pfizer characterized its increase in R&D expenses over the year as an “incremental” investment in coronavirus work. In Q1, Pfizer distributed $2.1B in shareholder dividends.