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Home . Health Resources . Drug Company Accounting Lies

Drug Company Accounting Lies

I know that people reading articles on OVitaminPro.com are already way better informed than the average bear. People shopping for supplements have wisely taken their health destiny in their own hands and are suspicious of drug company propaganda.

I would like to put a finer point on the deceptions of the pharmaceutical industry to give you even more ammunition in your quest for better health.

You will find two important links at the bottom of this article that will help you research this further if you desire. The first article is a summary of drug company lies about their research costs and the other is a brilliant essay by Maria Angell, former editor of the New England Journal of Medicine.

So why do drugs in the U.S. cost so much? If you believe the pharmaceutical industry, it is because of their selfless commitment to research.

According to industry press releases, it supposedly costs $1.3 billion to develop a new drug and get it approved. We can cut that figure in half right away because that is the amount factored in as money lost by not investing that research money in stocks and bonds. In other words, if the drug company didnít invest in research but took that money and invested it instead. We are now down to $650 million.

We, the people, the taxpayers pay about half the research costs by means of tax credits and deductions. Take another 50% off or $325 million.

The drug company estimates of development and approval costs are based on the worst case scenarios, not the true average. Correcting for this and other statistical distortions brings the total down closer to $125 million.

For some classes of drugs like cancer drugs, for example, foundations and government research agencies subsidize research costs. That amount varies from drug to drug but it further reduces real drug company costs.

Drug companies practice something called market spiral pricing. This means continuously raising prices across the board regardless of value or costs. The U.S. is the only first world country that allows drug companies to raise prices on older drugs. I watched my motherís diabetes medication increase from about $100 a month to about $800 a month over about 15 years. It wasnít because of new and better drugs necessarily but market spiral pricing.

To put this in context, imagine paying more each year for your cell phone. Even if you decided to buy last yearís model you would find the price had gone up 15% even though the manufacturing and distribution costs had decreased. Pretty sweet deal for this protected industry, wouldnít you say?

What can you do? Step one is to stay as healthy as you can to decrease your dependence on pharmaceuticals. Learning to give your body what it wants and stop giving it what is doesnít want is the concept. I have dedicated these pages to provide information that will help point you in the right direction.

The next step is to be aware of the unethical game that is being played. You read this article so now you have better information about that.

Drop your congressperson a letter or two every year telling him or her that you donít appreciate having these people eat your lunch. Encourage your family and friends to so the same. One person will not be able to stop this price gouging at your expense but together we have a fighting chance.

http://pubs.aarp.org/aarpbulletin/201405_DC/?pg=22&pm=2&u1=friend#pg22

http://www.wanttoknow.info/truthaboutdrugcompanies
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