New RN Report: Pharma CEOs Reaped $2.8 Billion Last Year While Implementing Massive Price Hikes
California Nurses Association Press Release, 10/10/16
Top pharmaceutical executives are making billions of dollars in compensation while implementing skyrocketing price increases for essential medications, according a new research report released today by the California Nurses Association/National Nurses United.
In “Outrageous Fortunes,” the report finds that pharma executives were handed over $11 billion in compensation the past five years. In 2015, the most recent year for which the data is available, the ten highest paid pharma chief executive officers (CEOs) made $327 million. Over 600 pharma executives made more than $1 million in pay packages last year.
The report finds a direct connection between executive pay, profiteering – through pay for performance arrangements based on profits and stock prices – and escalating drug prices that increasingly block patient access to affordable medication. The report may be read on line at http://nationalnursesunited.org/outrageous-fortunes
Nurses are campaigning across California for Proposition 61 on the November ballot that would lower drug prices and begin to hold the giant drug companies accountable for their profiteering.
“Outrageous Fortunes” is part of a series of pharmaceutical research policy statements from NNU’s research arm, the Institute for Health and Socio-Economic Policy. They can be viewed at http://www.nationalnursesunited.org/pages/research
“Outrageous Fortunes” tells the story of several highly paid pharma executives.
1- Horizon Pharma’s CEO Timothy Walbert topped the list with an overall compensation package of $93 million in 2015.
Horizon markets an arthritis pill Duexis for about $1,500 per month. Duexis is a combination of the generic equivalents of two over the counter meds Motrin and Pepcid, which would cost no more than $40 per month if prescribed separately. Horizon also acquired the main competitor to Duexis, Vimovo, a pain drug also made up of two generic drugs naproxen, (Aleve) and Nexium. After acquiring it, Horizon has increased the price of Vimovo by 600 percent to be in line with Duexis.
2- Mylan CEO Heather Bresch, $18.9 million in compensation in 2015, a 671 percent pay increase from 2007 to 2015.
Mylan and Bresch have, of course, gained particular notoriety after implementing 15 price hikes in seven years for the life saving EpiPen. Mylan created a one-time bonus plan for its top five executives, that was worth millions of dollars, if the stock price shot up.
3- Gilead Sciences Inc. Chairman and CEO John Martin, $18.7 million in 2015.
Gilead manufactures Sovaldi, the breakthrough drug for people struggling with hepatitis C – for which it charges $1,000 a pill or $84,000 for a 12-week treatment course.
In an earlier report, “Tough Pill to Swallow,” the IHSP notes that Sovaldi “created such a financial burden that the medication had to be rationed for thousands of patients on Medicaid and in prisons. In New Mexico and other states, Medicaid beneficiaries had to wait until they had late stage liver disease before qualifying for Sovaldi.”
A Congressional investigation found the price was set without any justification such as supposed research and development cost. The conclusion was the company’s sole concern was maximizing profits, even though Gilead knew “the price would put the drug out of reach for many patients and cause ‘extraordinary problems’ for public health programs.
Those who don’t get Sovaldi “can die some of the worse deaths I’ve ever seen,” New Mexico nurse practitioner Laura Bush told The Atlantic last September.Back to Press Releases »