Pharmaceutical companies are certainly enjoying the profits from the money pills; they once helped release into the market. No wonder, once necessary drugs are soon getting themselves listed, in the category of luxury products, quite unaffordable for an average earning person. The recent revenue charts of the pharmaceutical industry, too, support the argument. As per the figures, released by IMS, a pharmaceutical information and consulting company, in 2006, the global spending on prescription drugs, topped $600 billion. The figures promise to inflate drastically, if somehow, the revenue from illegal drugs can be added.
Prices Are Killing
The prices of various drugs have been hiked in a short time, which have made things quite difficult. For instance, Nitrogen Mustard, an old cancer drug, has suddenly been priced, almost double. The mentioned and various other such stunning trends, in drug costs, have left their users reeling in shock. With no correlation between the price increase and the manufacturing costs, much of the increased costs, can be attributed, straight under the profit head.
The Investment Side To The Argument
If questioned, all that the concerned pharmaceutical companies have to say, in justification of the rampant price hike, is the requirement of investment, into extensive research. As per the companies' argument, their research departments are in dire need of funds, to facilitate growth, in the field of medicine and therefore, the apparent hike in costs of drugs is initiated. Whatever is left is poured into the business, particularly into research.
However, a close analysis, presents deeper truths. Many companies, which supposedly invest tremendous amount and effort in research, come out with new medicines that are basically, just minor variants, of the already high-selling pharmaceutical products, in the market. This implies, minimal expenditure and even lower risk, as the products have already been tested and accepted by all concerned.
Research Versus Marketing And Administration Expenses
Pharmaceutical companies too have an expense side, but not towards mere research, as argued by them. Rather, in favor of, increased marketing expenses. The pharmaceutical industry spends a colossal amount, towards marketing expenses that ensure, that the unnecessarily high-priced products are passed off, to unwary consumers, despite availability of cheap and effective substitutes. Advertisement plays its inducing role here.
The established pharmaceutical companies are quite convincing, with their argument of serving with better products that obviously entail larger investments. However, the truer picture has all about to negate this argument. Increasing prices are proving to be very difficult for consumers to bear, and these consumers are simply helpless in the situation. It is left to the government to come forward and impose a price slab on the necessary drugs. Only then would the situation take a turn for the better.