GREED WATCH: Eight Big Drug Companies That Rip Off Patients Announce Nearly $100 Billion in Revenue and Over $15 Billion in Dividends and Stock Buybacks

This week, eight of the biggest drug companies announced raking in $98.2 billion in revenue in the first quarter of this year. Also during the first few months of 2024, these companies distributed $15.1 billion to shareholders through stock buybacks and dividends. They make billions while charging Americans prices up to four times higher than in other countries, forcing patients to cut pills and skip doses to make ends meet.

Novartis, Bristol Myers Squibb, and Merck, which are suing to block Medicare’s new ability to negotiate lower prescription drug prices, announced their drugs subject to negotiation continue to bring in hundreds of millions or billions in revenue. 

While big drug companies lobby to protect their profits by telling lawmakers Medicare’s new ability to negotiate threatens innovation, they are telling investors the opposite. In fact, following the passage of the Inflation Reduction Act, investment in research and development spending reached $161 billion in 2023, a 16.6 percent increase over 2022 and a nearly 50 percent increase since 2018. And despite the pharmaceutical lobby arguing small molecule innovation is under threat, a recent investor report confirms that the opposite is true. 

Table 1: Drug Company Sales in Q1 2024 Reported This Week

*14.4 billion CHF converted to USD based on an exchange rate of 0.91 CHF to $1.00

**10.5 billion EUR converted to USD based on an exchange rate of €0.94 to $1.00

Table 2: Drugs Selected For Medicare Negotiation By Revenue

• Bristol Myers Squibb CEO Chris Boerner touted “added assets, capabilities and expertise that strengthen our ability to drive long-term growth,” reassuring investors that, “while [the Inflation Reduction Act] has an impact in the middle of the decade, we feel very good about being able to more than compensate for that with a very young and attractive growth profile coming from our growth portfolio and the pipeline.” The company spent $2.7 billion on R&D in Q1.
• AbbVie COO Rob Michael bragged that the company is “off to an excellent start to the year,” and announced that they would be increasing their full-year earnings projections. Michael assured investors, “we continue to advance our R&D pipeline and invest for long term growth,” and announced that the company spent $1.9 billion on R&D while completing its acquisition of ImmunoGen for $10.1 billion in Q1. The company is also on track to acquire Cerevel Therapeutics for $8.7 billion. 
• Merck CFO Caroline Litchfield said the company will “continue to invest in our innovative pipeline,” telling investors, “Our excellent execution and continued investments in innovation will enable us to deliver value to patients, customers and shareholders now and well into the future.”
• Novartis CEO Vas Narasimhan touted “ongoing investment in R&D” as well as “innovation milestones” in drug development. He also announced the planned acquisition of biopharmaceutical company MorphoSys for €2.7 billion and a licensing deal with pharma company Arvinas, telling investors, “we are very actively looking across a range of both partnering, licensing and of course, bolt-on M&A.”
• Roche CEO Thomas Schinecker bragged that the company has continued to launch two new drugs every year, noting that “55 percent of our portfolio sales are from the new portfolio” of drugs launched since the end of 2015. In Q1, Roche announced an agreement to acquire point of care technology from biotech company LumiraDx.
• Astellas CEO Naoki Okamura bragged about increasing R&D investments by JPY22.8 billion year-over-year, telling investors, “We will continue to invest those strengths in primary focus and R&D functions in general.”
• AstraZeneca CFO Aradhana Sarin bragged about increasing R&D spending by 19 percent, while CEO Pascal Soriot confirmed that the company will continue to pursue mergers and acquisitions.
• Sanofi CEO Paul Hudson told investors the company had “an excellent start in 2024 with 7 percent sales growth,” noting that the result “further demonstrates our ability to execute successful launches and bring new medicines to patients.” During the earnings call, executives bragged about R&D spending increasing 10 percent to €1.7 billion compared to Q1 2023. In Q1, Sanofi announced the acquisition of drug company Inhibrx for approximately $1.7 billion.
• Gilead CEO Dan O’Day touted a “strong first quarter,” noting, “sales growth for the quarter reflected the diversity of our portfolio.” The company spent $1.5 billion on R&D and completed its acquisition of CymaBay for $4.3 billion in Q1.

Over 80 percent of voters support giving Medicare the power to negotiate, making it the most popular provision in the Inflation Reduction Act. The Inflation Reduction Act brings down prescription drug costs for everyday Americans, especially seniors, by capping the price of insulin at $35 per month and providing free vaccines including shingles, giving Medicare the power to negotiate lower drug prices, and limiting the amount people have to pay each year for prescription drugs to $2,000 annually starting in 2025. 

Read more:

FACT SHEET: Big Drug Companies Are In Court To Stop Medicare From Negotiating Lower Prices In Order To Protect Sky-High Profits

FACT SHEET: New Estimates Find That Medicare Negotiations Will Lower Drug Prices By Thousands of Dollars Every Year, Finally Limiting the Power of Big Drug Companies

REPORT: Why Medicare Needs the Power to Negotiate for Lower Drug Costs: The Five Drugs That Tell the Story