Profits of Big Pharma relative to the Fortune 500

I recently misquoted a statistic that stuck in my head a little differently than how I originally read it. Here’s the truth:

In 2002, the combined profits of the top 10 pharmaceutical companies were more than the combined profits than the other 490 companies in the Fortune 500! (This analysis compliments of journalist Randall F. Fitzgerald, published in his book The Hundred-Year Lie.)

(I had said the top 5, and I may have implied a comparison of revenues rather than profits.)

It’s still appalling. One of my frustrations is that many “charities” we give money to are really just funneling even more money into R&D for drug development. It’s certainly expensive to go through clinical trials with a drug. But the companies who can afford to do it stand to make billions on one patented chemical. Dr. Jerry Avorn of Harvard Medical School says, in his book Powerful Medicines,

“There is a comforting shared myth that by the time the FDA approves a new drug, the product has been studied exhaustively and determined to be a worthwhile new addition, and that all its actions in the body, both good and bad, are well defined. In fact none of these assumptions is quite correct. The FDA itself does not study any drugs prior to approval, relying on the company that makes the product to generate that information.”

Dr. Marcia Angell says in her book, The Truth About the Drug Companies, “Is there some way companies can rig clinical trials to make their drugs look better than they are? Unfortunately, the answer is yes. Trials can be rigged in a dozen ways and it happens all the time.”

The fox is guarding the henhouse. I don’t give money to the “pink ribbon campaign” or other thinly disguised bankrolling of Big Pharma, to help them make more chemicals that will never cure women of anything.

But thank you to a reader who questioned my statistic about the top pharma companies versus the rest of the Fortune 500.