Big pharmaceutical companies currently have a monopoly over the drugs Americans need and the prices they pay. In fact, about 23 cents of every health care dollar goes towards prescription drugs that ultimately end up lining Big Pharma’s pockets.
Big Pharma has the power to raise or lower the prices of life-saving drugs, but current trends indicate that the price hikes are only ever increasing—and will likely continue to increase barring some change in the system. Consumers are ultimately getting price-gouged for the drugs they need, so what do you need to know in order to be an informed consumer?
The exponential increases in drug prices across the board force thousands of Americans to make a choice between paying their bills or paying for the medication they need on a monthly basis. Drug costs are cutting into hard-working Americans’ paychecks, according to America’s Health Insurance Plans (AHIP). For example:
- A 652% price hike for the drug that treats opioid overdoses—at the height of the opioid crisis in the U.S.
- A 596% price hike for a popular antidepressant in just 3 years
- A 248% price hike for Humira, with 12 price hikes in five years for the world’s largest selling drug
Big Pharma companies are making money off of these price hikes—and they are seeing the highest profit margins out of the biggest companies in the U.S.
Take the following numbers into consideration:
- Among the 25 biggest pharmaceutical companies, the average profit margins were about 15-20%.
- Among the 500 biggest non-pharma companies, their profit margins ranged from 4-9%. That’s a vast difference when compared to the margins of the largest companies in the U.S.:
- Walmart’s net margin of 1.01% (as of October 2018) equaled to about $500.343 billion in revenue.
- Target’s net margin of 4.31% (as of October 2018) equaled to about $71.879 billion in revenue.
What Can You Do?
It can be easy to feel helpless in the current system, but there are some things you can do to push change. For example, you can support the CREATES Act now that will help fight monopolies. You can support using the Institute for Clinical and Economic Review (ICER) as an independent evaluator of drug value.
At a more local level, the NC Coalition for Fiscal Health is dedicated to helping find solutions for the rising costs of healthcare. Have the sky-high costs of healthcare in our state impacted you and/or your family’s lives? Do you want to do something about it? Join the Coalition now to receive updates about new legislation and policies that will affect YOUR healthcare. Sign up now!