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American For-Profit: The Pharmaceutical Industry

In 2016, a perfect, nine-inch, shiny pecan pie was waiting for me on my desk at my summer job. I remember looking around in bewilderment, chuckling to myself, and then seriously considering, is someone trying to murder me? It turned out, no, definitely not. One of my coworkers simply didn’t know where else to put it. She also didn’t know I’m deathly allergic to pecans.

I’m also allergic to walnuts, cashews, peanuts, hazelnuts, pistachios, macadamia nuts, pine nuts, and chestnuts. If I eat one of these nuts, I will experience anaphylaxis, my throat will become inflamed. If I do not use my EpiPen, I could suffocate to death. 

Unfortunately, this is not a rare condition. In the U.S., 1 in 13 children has a life-threatening allergy. Every three minutes, someone goes to the emergency room due to a food allergy. 

So then why is it so expensive to buy an EpiPen, the only life-saving drug that can prevent sudden tragedy? 

That’s what I was wondering in 2016, the same year that this mysterious pecan pie surfaced on my desk. At the time, the EpiPen was so expensive, I could no longer afford it. 

Since 2011, the price of EpiPens has risen 400 percent. It costs over $600 for a two-pack. In 2020, the price is still high, though less outrageous, at around $400. My French mother still brings me back EpiPens from France, where they cost only $50 each. Others are not so lucky.

The High Price Tag of Life-Saving Drugs

This trend—life-saving drugs with outrageously high price tags—occurs in more than just allergy-related drugs. It is endemic of the pharmaceutical industry at large. Companies that have a monopoly on a drug raise the price to increase profits, even if it means endangering peoples’ lives.

This is the America For-Profit series, exposing the ways corporations infiltrate U.S. politics, policy, and institutions that are run under the guise of public interest.

In case you missed the first America For-Profit article, catch up on the dangers of private immigrant prisons in the U.S. here

The pharmaceutical industry puts American lives at risk to drive profits. Learn more about the industry’s exploitation and what you can do.

The Pharmaceutical Industry

The pharmaceutical industry is an immensely profitable business. In 2014, its global revenue was over $1 trillion. Even though it is a global industry, the U.S. takes the lead. Out of the top 10 pharmaceutical companies in 2017, six have their headquarters in the U.S., including Pfizer, Gilead, AbbVie, Johnson & Johnson, and Merck. 

It will come as no surprise that 70 percent of Americans are on medication. 

Big Pharma Values Advertising Over Research and Development


Thanks to pharma’s advertising, millions of Americans are prescribed expensive, potentially dangerous drugs. According to the BMJ Journal, pharma companies spend 19 times more money on advertising than on research and development. This pays off for the companies, who cash in $4 in retail sales for every $1 spent on advertisements. To put these numbers into perspective, consider that Boehringer Ingelheim spent an amassed $464 million to advertise the blood thinner, Pradaxa, of which they made over $1 billion in profits. 

According to the American Addiction Center, doctors prescribe brand name drugs from direct-to-consumer advertisements over cheaper, more affordable alternatives for multiple reasons. In some cases, people prefer to take drugs that they have seen from advertisements. Others hear about them from friends and family, who also saw these ads. In other scenarios, doctors receive bonuses and payouts from the pharmaceutical companies when they prescribe certain medications, regardless of whether they are effective or not—or if they help or hurt the patient. 

The Opioid Crisis

Beginning in the 1990s, the pharmaceutical industry indicated that their opioid pain relievers were not addicting which lead doctors to prescribe the drugs at a higher rate. Before the medical community could fully understand that these opioids were highly addictive substances, it was too late, and America entered an opioid epidemic.

According to the U.S. Department of Health and Human Services, today, an average of 130 people die every day due to opioid overdoses. From 1999 to 2017, nearly 400,000 people died due to opioid-related substances, including prescribed opioids, increased heroin usage, and synthetic opioids.

Watch Lisa Raville explain how Supervised Consumption Sites may help solve the overdose epidemic:

Pharma’s Political Influence

Despite the pharmaceutical industry’s tragic misguidance that resulted in the opioid crisis, the pharmaceutical industry has used its influence for a legislative change in its favor. Through lobbying efforts totaling $2.9 billion between 1998 and 2014, and campaign donations totaling $15 billion between 2013 and 2014, the pharmaceutical industry is closely tied with American politics. The industry even contributes to the U.S. Food and Drug Administration’s budget, leading some to question the integrity of the government organization.

People Cannot Afford the Drugs They Need

Today, pharmaceutical companies continue to make a profit off of the sick. In fact, according to Ars Technica, the pharmaceutical industry celebrated the new year by raising prices on over 250 drugs in an increase that exceeds what can be accounted for by inflation.  

In past years, several drugs have seen outrageous price increases. Prozac, the anti-depressant, saw a price increase of 879 percent in 2019. Daraprim, an anti-parasite medication, costs over 5,000 percent more than its original price of $13.50 per pill. 

According to Drug Watch, in 2018, the cost of insulin, the daily life-saving drug for diabetics, cost $450 per 10mL bottle, requiring a patient to spend upwards of $3,000 a month to stay alive. 

With these increases, patients have had look elsewhere to afford their vital medications. In a 2016 poll, almost 19 million Americans turned to other countries for more reasonably priced drugs. To afford insulin, many patients turned to Canada, where a 10mL bottle of insulin costs only around $21

The Effort to Make Health Affordable

In his TEDxMileHigh talk, P.J. Parmar shows how a for-profit business does not need to exploit the poor to be profitable. Explore how there is another way. 

As a family doctor on East Colfax Ave, which Parmar describes as a “medical desert,” Parmar faces the lack of medical clinics and hospitals to accommodate a large number of people on Medicaid, a.k.a, 20 percent of the U.S.

Parmar explains that only 20 percent of family doctors in Denver take Medicaid patients, largely because Medicaid pays significantly less than private insurance. 

In his career, Parmar has created a path for people of lower-income to receive the health care they need without sacrificing their savings. Through the creation of his private business and by making important changes to suit his clients’ demographics, Parmar created a small-scale system of health care that does not break the bank for his clients and does not encourage the overprescription of drugs. 

Going Forward

The pharmaceutical industry might be deeply embedded in our government, policy, television screens, and psyches, but there is still hope. The first step is to stay informed. Learn about the need to create a federal regulation of drug prices, improve transparency, and reduce the amount of direct-to-consumer advertising. Hopefully someday in the future, there will be no nefarious incentives for doctors and insurance companies to encourage the use of highly-priced and/or dangerous and highly addictive drugs. 

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