The leading 14 Big Pharma firms paid out more to enrich their investors than they spent on research and development from 2016 to 2020, the U.S. House Oversight Committee revealed.
They spent nearly 10% more on stock buybacks and dividends than they did on developing and testing new medications. Since 2016, 14 top pharmaceutical companies spent $577 billion on stock buybacks and dividends – $56 billion more than research and development.
Also, the 14 firms spent over $3.2 billion in aggregate executive compensation for their highest-paid executives in the past five years, an increase of 14% during the four-year period analyzed.
According to the committee's report:
From 2016 to 2020, the 14 leading drug companies spent $577 billion on stock buybacks and dividends, compared with $521 billion on R&D—a $56 billion difference.
Assuming the same rate of spending, these 14 companies are projected to spend $1.15 trillion on buybacks and dividends from 2020 through 2029. This is more than twice the amount the Congressional Budget Office projected would be saved by H.R. 3 over the same period.
From 2016 to 2020, compensation for the 14 companies' top executives totalled $3.2 billion, with compensation growing by 14% over that five-year period.
Many drug companies spent a significant portion of their R&D budget on finding ways to suppress generic and biosimilar competition while continuing to raise prices, rather than on innovative research.
House Committee on Oversight and Reform Chair Carolyn B. Maloney (D-N.Y.) said in a statement:
"This report finds that the world's leading drug companies have used price increases to boost payouts to investors and executives while spending less on research and development," she continued. "The report also shows that industry claims about the potential impact of pricing reforms are overblown."
Big Pharma Firms Spent More Enriching Investors Than on R&D: Report | Common Dreams News
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