The proposed buyout of the Dublin based drug company Allergan by industry behemoth Pfizer gives a good indication of the morality – or lack of – in the pharmaceutical industry.
Most of the noise about this proposed deal has been about the plan to undergo a “tax inversion,” an acrobatic-sounding corporate maneuver which will move the headquarters to Dublin. And allow Pfizer to avoid that galling business of having to pay taxes in the US – reducing what Pfizer (in theory) pays in corporate taxes from 25% to an estimated 17% or so.
It would also give “enhanced access to tens of billions parked overseas” reports Reuters.
What About the Patients?
Amongst the clamor and dissent, which includes the government (which stands to lose zillions of tax dollars), I have not seen much written about whether it’s going to be bad for the people for whom these companies exist (at least in theory) – the patients.
It seems to me a classic example of corporate medicine – a trend that is overtaking the whole of US healthcare. And whose bottom line is THE bottom line, rather than providing the best service for the “consumer”. So my gut feeling is this is not going to be a good thing for us peons.
It seems a part of the culture of unbridled avarice which is an integral part of this corporate healthcare culture. Of which there have been so many examples recently.
The obnoxious-sounding 32-year old former hedge fund manager, Martin Shkreli, buying Daraprim and hiking the price approximately 5,000%. Sovaldi, the hepatitis C drug that is breaking the bank at the VA because it costs $84,000 a course. The cancer-curing biological Gleevac, costing around $100,000 a course – which prompted 100 leading oncologists from around the world to write an open letter in the journal Blood, and Dr. Brian Druker, one of the signatories, to blithely ask "If you are making $3 billion a year on Gleevec, could you get by with $2 billion?”
How Much Do You Need to Make?
Profits of the top 10 car manufacturers are a measly 6%, but they seem to be doing OK. So you would think a company that Forbes reported in May 2014 as showing the “astounding” profitability of 42%, wouldn’t need to go in for these sleazy shenanigans.
And incidentally, the proposed price is $160 billion, for a company whose principal product is wrinkle-obliterating Botox. And the fact that Pfizer has become fabulously rich in large part from Viagra, says something about our societal drug habits/imperatives.
Ironically, Pfizer CEO Ian Read is quoted as saying “earning greater respect from society” is one of the company’s strategic imperatives – after its series of fines for over-zealous marketing, culminating in a payment of $2.3 billion for inappropriately promoting Bextra.
This deal with Allergan hardly seems to be a move that will help promote their image as a respected and ethical company, or earn them greater respect from anyone.
