|WASHINGTON, D.C. — A new report from Patients For Affordable Drugs takes on Big Pharma’s long-standing claim that any constraints on its pricing power will destroy innovation and access to valuable new medicines, and shows why it is clearly possible for Americans to enjoy both innovation and lower prices.
“I have an incurable blood cancer; I am completely dependent on new drugs for my survival. I can assure you that no one cares more about innovation than patients, which is why Big Pharma has built its lobbying on this threat,” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs.
“But the industry’s tale is a Big Lie built on a tiny kernel of truth: If we reduce profits too aggressively for any business or industry, innovation will dry up. That’s why we are not proposing draconian cuts to profit or anything close to that. We are proposing to balance reasonable profit with lower prices that ensure innovation that is affordable and accessible, and this report shows that is eminently achievable,” Mitchell said.
Given that Americans pay almost four times the prices paid in other wealthy nations, and pharmaceutical industry profit margins are almost three times theS&P 500 average, it is clear there is room to lower prices in the United States and leave the industry among the most profitable — and, therefore, highly attractive to investors. A Congressional Budget Office analysis found that a large reduction in revenue of up to $1 trillion over 10 years would only result in a modest reduction in new drugs coming to market during the same period: eight fewer new drugs out of 300.
The Truth About Innovation and Drug Prices report offers detailed evidence to support five key arguments: