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The pharmaceutical industry includes drug manufacturers, drug marketers, and biotechnology companies. These companies work to research, develop and promote medications in the United States and around the world. These medications often save lives, cure diseases and help to keep our population healthy.
Yet, the pharmaceutical industry has not always gotten the best press in recent years. Unfortunately, these news stories are not always accurate. As such, it is time to put these common myths to rest.
Myth #1: Exaggerated Costs
Many people believe that pharmaceutical companies exaggerate the costs of developing new drugs. The belief is that they do this to justify the high prices consumers pay. The reality is that the research and development expenses to make these drugs is staggering. In the United States, pharmaceutical companies spent $51 billion on research and development alone in 2014. This comprised 21% of all research and development spending by all U.S. businesses that year.
In fact, a new drug costs between $4 and $11 billion to develop. That is three-to-five times more than economists previously realized. Why is that cost so high? One reason is that a single clinical trial can cost $100 million at the high end. Also, many medications fail at some point in the research and development process.
Truth: It takes a lot of money to develop safe new drugs for consumers.
Myth #2: Pharmaceutical Companies Do Not Develop Their Own Drugs
This is untrue. While there are many contributing sources along the way, the pharmaceutical industry is one of the primary reasons why we have modern medications. The government and academic researchers at universities help contribute to highlighting diseases and promising treatments. Their research provides the groundwork for the development of new drugs.
However, the pharmaceutical industry leads the way in developing safe medications based on that research. In fact, the private sector patents nearly 91% of all approved drugs.
Truth: Pharmaceutical companies develop the majority of the drugs that we have on the market.
Myth #3: The High Cost of Prescriptions Is Why Health Insurance Is Expensive
Another popular myth is that the high costs of prescription medications are the primary cause of increases in health insurance premiums for middle-class families. In reality, only ten cents of every U.S. healthcare dollar is spent on medications and prescriptions. In addition, medications actually help to minimize the cost of long-term healthcare by reducing diseases and chronic illness.
For example, cardiac patients now take a variety of medications to help control their cholesterol, blood pressure and inflammation. This medication minimizes the risk of suffering a serious heart attack. This reduces the cost of lengthy hospitalizations, surgeries, rehabilitation and long-term care.
Truth: Prescription medication costs are not the primary reason for high health insurance costs.
Contact CMPD Licensing Today
The pharmaceutical industry helps develop medications that keep us all safe and healthy. As such, it is important to dispel any negative myths that persist within the media. Through research and development, pharmaceutical companies will continue to be at the forefront of modern medicine when we need them the most.
At CMPD Licensing, LLC, we provide guidance to pharmacies and pharmaceutical companies. This guidance includes help controlling the cost-of-goods, improving your Generic-Effective-Rate (GER) and implementing best practices. If you are interested in becoming a CMPD licensee, then we would love to speak to you. Fill out our confidential contact form to find out more about this incredible opportunity.
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