What owns at least one multi-million-dollar yacht, lives in a palatial multi-million (or billion) dollar mansion, has become a newly-minted billionaire profiting off the 700,00 American who have died during the pandemic and the 45 million (14% of the population) who have contracted COVID. If you guessed the bag men (and women), CEOs and insiders in pharma-land, you win.
How this for a big money scam? As COVID became a major pandemic, before a vaccine existed these bottom feeding execs used blue sky promises of vaccine development to reap millions, even billions from unwary investors. At eleven companies, overly optimistic vaccine announcements were accompanied by executives and other insiders selling over $1 billion worth of shares from March 2020 to July 2020. Only three companies, Pfizer (and its partner BioNTech), Moderna, and Johnson & Johnson ever managed to market a vaccine. But if public health lost out, corporate profits did not. Even the feds, succumbing to the hysteria of the early pandemic, chipped in over $20 billion taxpayer dollars to every drug company that raised its hand. Result: nine drug industry CEOs and insiders became billionaires.
Who was asleep at the switch while all the hanky-panky was going on? Just about every politician, businessman and financial guru in the capitalist universe. Let’s start at the beginning of this sordid tale. Most analysts have estimated that it costs $1.20 to produce each vaccine dose. The price the three companies are charging governments around the world ($19.00-$27.00/dose) is not even in the same stratosphere. Afraid to bargain or to unite and refuse to pay what amounts to larceny most countries, including the U.S., are paying up to 24 times the cost of production. [Oxfam International, Peoples’ Vaccine Alliance 7/29/2021] To add insult to injury, $8.3 billion taxpayer dollars subsidized the development of the technology.
It’s no secret that CEO compensation is generally tied to stock performance. Albert Bourla, one of the slipperiest characters in the drug industry, ex-veterinarian and CEO of Pfizer, the first company to get an EUA (emergency use authorization) from the FDA to market its vaccine, was paid $21million in FY2020 (10/1/2019-9/30/2020), a whopping 17% increase from his compensation in 2019. Not content with earning more than $75,000 per day, and more than a month before receiving FDA approval, he put out a press release describing Pfizer’s late stage vaccine trials as a “critical milestone” in the race to develop a vaccine, and a “significant step” towards ending the coronavirus pandemic. The hype worked. Pfizer’s stock price rocketed up 15% in one day day. Striking while the iron was hot, as the announcement was breaking, this corporate crook sold more than 60% of his Pfizer’s stock and walked away with $5.6 million. In the upside-down world of big pharma where no bad deed ever gets challenged, he got away with murder. Chances are this is only the tip of the golden rainbow. Pfizer is currently forecasting revenues of $33.5 billion from its COVID vaccine sales in 2021. In 2020, its total revenue from all products was $42 billion.
Anyone schooled in pay to play politics knows drug company profiteering is hydra headed. Political leaders of both parties to whom voters entrust their wellbeing have been in the pocket of big pharma for decades. In 2003, when Medicare Part D, the Medicare prescription drug program, was created, Congress inserted a poison pill prohibiting Medicare from negotiating drug prices. Known as the non-interference clause, it cleared the way for the drug industry to take the American public to the cleaners. In every other developed nation the price their citizens pay for drugs is subject to government regulation. Government oversight makes a huge difference. Take Humira, the best-selling drug in the world with total revenues last year of $20 billion. Incredibly $16 billion, that’s 80%, came from U.S. sales alone. With a vastly lower price, sales in the rest of the world brought in $4 billion. The overcharging of Americans by the drug companies has become so alarming that recently the Rand corporation studied the disparity and found that dropping the price of drugs sold in the U.S. to the prices charged in every other country could reduce spending on those drugs by half.
Need more proof? A report in Public Citizen, “United We Spend,” puts the icing on the cake. U.S. sales of the 20 top-selling drugs totaled $101.1 billion in 2020, while sales of these same drugs in the rest of the world totaled $57 billion. There’s more. For eleven of the twenty top selling drugs, big pharma made twice as much in the U.S. as in the rest of the world.
How do they get away with it? When it comes to the political circus in Washington, the obvious answer is the right one. Money and lots of it. Congressional members are leading beneficiaries of Big Pharma cash. Drug makers and health insurance companies have already spent $171 million on lobbying in 2021. [Common Dreams] Two-thirds of Congress cashed a pharma campaign check in 2020. [STAT] In a new KHN report, the drug industry “contributed” $1.6 million to elected officials on both sides of the aisle in nearly equal amounts.
With that much money sloshing around, the stakes must be enormous. Big Pharma is working tirelessly to keep Medicare the largest buyer of drugs in the U.S. and a trend setter among health insurance companies from negotiating drug prices. A 2019 study from the University of Pennsylvania is telling —from 2000 to 2018 drug companies pocketed $8.6 trillion just by raising the prices of the most widely used drugs on the market without making any changes in formulas or production methods.
| “This eye-popping rip off Big Pharma is getting away with is an insult to the American people. Empowering Medicare to push back against inflated drug prices is the responsible and commonsense way to stand up to the industry’s greed.” [Rick Claypool ”United We Spend” Public Citizen] |
Bear in mind that most Democrats running for election or reelection in 2020 solemnly promised that instituting federal negotiations on drug prices was a done deal if they won. That provision was included in the original human infrastructure bill which Bernie Sanders authored with a price tag of $6 trillion later whittled down to $3.5 trillion. The came the Rubicon moment as the entire Congressional Progressive caucus vowed to stand firm on Medicare negotiating drug prices (some not all prices), the inclusion of hearing, dental and vision benefits in Medicare, paid family leave, free community college and permanent child tax credits. Listen to Pramila Jayapal (D-WA state] waxing eloquent on not giving an inch to efforts to torpedo these programs —
| “We have no intention of backing down. [Addressing the possibility of fewer health programs in the bill] A lot of people have asked: ‘Isn’t something better than nothing?’ And the answer, quite simply, is no. Because when it comes down to something rather than nothing, it’s the same people who are forced to settle for nothing over and over and over again.” [Pramila Jayapal (D-WA state) on a phone call to supporters, October 12] |
As usual conservative Democrats, with a long history of holding firm against any spending that does not benefit its oligarchic donors, prevailed. The much-reduced reconciliation package (less than half the $3.5 trillion which was a reduction from the original $6 trillion) axed Medicare negotiating drug prices, paid family leave, free community college, permanent child tax credit, senior vision and dental benefits.
How did “progressives respond? Howls of outrage and renewed determination to get their spending priorities back in the bill? Actually, not at all. Suddenly all their progressive zeal for content was replaced by the single demand that both bills be introduced together regardless of what was in them. Read and weep —”dozens of our members insist on keeping both bills linked and cannot vote only for one until they can be voted on altogether.” [Pramila Jayapal 10/29/21] What happened to all the programs so dear to the hearts of “progressives” including the president? Here’s how President Biden rationalized the disappearance of free community college — maybe “in the next several years.” [Biden at a televised town hall, 10/25/2021]
Poll after poll shows a groundswell of support (83%) for the social agenda in the original reconciliation bill particularly allowing Medicare to negotiate drug prices. After being bombarded with drug industry hogwash that lower prices would slow innovation and R&D for new drugs, 93% still felt that even if prices were lowered, drug companies would still come out on top — “Even with [lobbying group] PhRMA spending millions on scare tactics and lies, voters know the truth.” [AARP, national organization representing 38 million U.S. seniors.]
The worst fall-out of the decades of broken promises is that Americans have steadily lost faith in their leaders to do the right thing. In 2014 a Princeton University study looked at 1,779 policies and found that what the people wanted had no influence on congressional action on these policies. How right they were and still are. “Less than half of the public say they have confidence in President Biden (46%) and Democrats in Congress (48%) to recommend the right thing on prescription drug prices… [Surprisingly] a third say they have [more] confidence in Republicans in Congress (34%).” [KHN poll on public sentiment on drug negotiation bill]
P.T. Barnum (some credit Abe Lincoln) got it right —”You can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time.” Can you hear us now Joe, Chuck, and Nancy?
