Feb 7, 2020

Brand Name Drug Companies Keep the Good Times Rolling for Shareholders by Price-Gouging American Patients

This week, three more Big Pharma giants proved yet again that hiking prices is a profitable practice for an industry more concerned with pleasing its shareholders than helping patients.  Merck, GlaxoSmithKline (GSK) and Bristol-Myers Squibb all reported sky-high profits this week after engaging in a series of price hikes in 2019.

  • This quarter, Merck reported a 29 percent jump in profits and a net income of $2.36 billion – up from $1.83 billion the year before.
  • Merck beat Wall Street adjusted earnings expectations, reporting $2.98 billion.
  • GSK’s FY19 profits jumped over $1 billion to $6 billion from the previous year.
  • For this quarter, GSK reported $11.62 billion in sales, up 11 percent.
  • Bristol-Myers Squibb’s reported a 33 percent increase in revenues from Q4 of 2018.
  • Bristol-Myers Squibb’s Q4 results blew past analysts’ expectations, rising nearly $2 billion from the previous year—from $5.97 billion to $7.94 billion.
Over the past year, Merck, GSK and Bristol-Myers Squibb have all hiked prices on American patients.Merck

  • Merck rang in the new year by increasing prices on about 15 medications, including on diabetes medicines Januvia and Janumet and block-buster cancer drug Keytruda.
  • The brand name company also raised the price of HIV therapy treatment Insentress this past summer by five percent.
  • This year, the company has already hiked prices 42 times by a median of five percent, including on its newly acquired cancer drug Zejula.
  • And In 2019, GSK jacked-up prices 61 times, including on top-selling respiratory drug Trelegy Ellipta. These price hikes come after The Wall Street Journal reported last January that the company would raise prices on dozens of the drugs in its portfolio.
  • This past summer, GSK announced it was raising the price of their ovarian cancer drug Zejula. The price of a 30-day, 100mg supply of Zejula rose five percent from $6,567 to $6,913. When the drug was first approved by the FDA in 2017, it cost $4,917.
Bristol-Myers Squibb
  • Bristol-Myers Squibb started off the new year by hiking prices on at least ten medications, including two key cancer drugs, Opdivo and Revlimid.
  • Bristol-Myers Squibb acquired Revlimid in a $74 billion deal with Celgene in November. On the day the deal was announced, Celgene boosted the price of Revlimid to $719.82. The drug cost $247.28 in 2007.
  • This was business as usual for Bristol-Myers Squibb. From 2015 to 2019 the company had the most price hikes per drug of any Big Pharma company.

Merck, GSK and Bristol-Myers Squibb join six other Big Pharma giants who have reported blockbuster earnings after hiking prices on American patients –Johnson & Johnson, Eli Lilly, Roche, Novartis, Pfizer & Amgen. Stay tuned for more as fourth quarter earnings reports continue to roll in.