KEY SUMMARY: Innovation within the pharmaceutical industry has died. It has been replaced with a business model of raising prices on existing drugs and purchasing smaller innovative biotech companies who have promising futures.
According to today’s Wall Street Journal “Pfizer Inc., Amgen Inc., Allergan PLC, Horizon Pharma PLC and others have raised U.S. prices for dozens of branded drugs since late December, with many of the increases between 9% and 10%, according to equity analysts. The increases are on list prices, before any discounts or rebates that manufacturers sometimes provide insurers and other payers. [inlinetweet prefix=”” tweeter=”” suffix=”null”]Some of the increases add thousands of dollars to the cost of already expensive drugs, and come on top of repeated price hikes in recent years.[/inlinetweet]
They are using the same old PR talking points such as the value of drugs to patients and saying “the price hikes are “our way of insuring that we can survive and develop these programs and bring these new innovative drugs to market,” but that’s a load of horse manure.
Albert Einstein said “Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.” That could apply to pharmaceutical executives who have lost sight of the people we serve. Their only concern seems to be investors and hiring people who “fit their idea” of managers which is ironic because that idea is what’s killing pharma.
This is going to lead to big bloated corporations that have to continue to feed the balance sheet in order to survive. In the end patients are going to lose and pharma will have to angry finger of voters pointed squarely at them during the coming election.
What does this mean for DTC marketing? Less investment, less willingness to try new ways to reach patients and more MBA spreadsheets to quantify ROI of market segments at a time when patients want to be treated as people.