• silent2k@lemmy.world
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    1 year ago

    Pfizers R&D budget is 11 billion per year. That money comes from products from the market.

    • EdibleFriend@lemmy.world
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      1 year ago

      They made 100 billion in profit and spent 11 on research. They can afford to sell things much much cheaper and still have both profits and research money.

    • conditional_soup@lemm.ee
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      1 year ago

      Average retail net margins (profit margin as share of revenue) are about 3% on a good year. Pfizer’s was something like 30% last year. They cleared 100 billion in revenue, meaning 30 billion in straight profit (the 11 billion came out of the other 60-odd percent, because it’s not an even 30). In one year, they made almost enough money to buy Twitter. They made enough profit to cover Kansas and Oklahoma’s entire 2022 FY budgets. I’m trying to drive home the absolute ridiculous enormity of those profits, because it’s not easy to really grasp. The point is, it’s not like they don’t have a lot of room to breathe.

      Some other things to consider:

      -Of that 11 billion, how much is government funding and grants? IIRC, Uncle Sam pays for the development of a whole lot of what ends up being private products in healthcare.

      -Of their 60-odd billion in costs, how much was advertising? Look, I know you gotta sell to make money, but advertising to patients is annoying, expensive, and (in terms of medical ethics) icky. It’s not like they can’t save some money there to do R&D.

      The point is: Pfizer could easily cut their prices on life-saving medicine and still have tidy profits.

      • silent2k@lemmy.world
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        1 year ago

        All your questions are good questions that can easily be answered. None of those are valid to justify novel drugs pricing at production costs.

    • Pons_Aelius@kbin.social
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      1 year ago

      Quoting one figure is pretty useless to make a point as it exists only as “A big number” with nothing to compare it to.

      Since you know their financials enough to quote one figure here:

      What is their annual revenue?

      What is their annual profit?

      • maryjayjay@lemmy.world
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        1 year ago

        They’re a publicly traded company. All that info is published in their annual financial report

      • silent2k@lemmy.world
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        1 year ago

        Like quoting the production cost without any evidence or considering any R&D costs? I did not start the bullshit.

    • be_excellent_to_each_other@kbin.social
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      1 year ago

      https://jacobin.com/2023/09/big-pharma-research-and-development-new-drugs-buybacks-biden-medicare-negotiation

      Last year, the three largest US-listed pharmaceutical companies by revenues, Pfizer, Johnson & Johnson, and Merck, spent a combined $39.6 billion on R&D. That is, admittedly, a lot of money. But less than Medicare is currently paying on just ten drugs

      While Big Pharma holds vast portfolios of existing patents for prescription drugs, the innovation pipeline for new drugs actually has very little to do with Big Pharma. In reality, public sources — especially the NIH — fund the basic research that makes scientific breakthroughs. Then small, boutique biotech and pharmaceutical firms take that publicly generated knowledge and do the final stages of research, like running clinical trials, that get the drugs to market. The share of small companies in the supply of new drugs is huge, and it’s still growing. Fully two-thirds of new drugs now come from these small companies, up from one-third twenty years ago. It is not the research labs of Pfizer that are developing new drugs.

        • be_excellent_to_each_other@kbin.social
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          1 year ago

          From the passage I already quoted:

          In reality, public sources — especially the NIH — fund the basic research that makes scientific breakthroughs. Then small, boutique biotech and pharmaceutical firms take that publicly generated knowledge and do the final stages of research, like running clinical trials, that get the drugs to market.

          • Quereller@lemmy.one
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            1 year ago

            That is not true. Small biotech usually cannot effort late stage development. They either just get buyed by big pharma. Or they licence the lead compound to big pharma and get royalties. Very few exemptions to this.

            Edit: the link you provide cites this FT article as a source for this claim. However the article is about M&A and supports my point.

            • be_excellent_to_each_other@kbin.social
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              1 year ago

              I’ll assume you know more about this than I do despite the lack of any citation.

              I refuse to believe there’s an ethically acceptable business justification for this ridiculous markup.

              The entire healthcare industry in the US is built on a foundation of corporate greed. This is just one obvious example.

              • Quereller@lemmy.one
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                1 year ago

                At least they loose exclusivity after 15 -20 years and generics are usually much cheaper.