TIME Sept. 14, 2009 edition.
Shares of Pfizer (PFE 16.21, -0.18, -1.10%) were down a fraction Wednesday morning, after the Justice Department announced what it said was the largest health-care-fraud settlement in the agency's history.
Now, I don't know everything about stocks and investing, but if a company has to pay a nagging little fine of $2.3 billion (with a 'b') and the stock's value only drops a shade over 1%, that tells me that the investors realize that this is really only a drop in the bucket for Pfizer. For years, we have all been hearing that the high cost of pharmaceuticals in this country are because of the high cost of meeting federal drug safety standards and testing. Well, if that were true, how did Pfizer have so much money they could afford to pay this fine so easily? Those high prices they were collecting should have already been spent on that testing and regulation.
Maybe I'm going out on a limb here, but perhaps the high cost of drugs is so that the company can line its (and its investors' pockets)?
That issue of TIME I quoted above has 10 1/2 pages of ads for 5 prescription-only drugs from 4 different manufacturers (none of them Pfizer; they must be broke this week). TIME doesn't do that for pennies! Why advertise to the public? If I have to see a doctor to get these medicines, just tell HIM about them. That's what I pay him and the pharmacist for: to tell me what medicines are available for my particular condition and to prescribe what THEY feel is the best treatment for it.
I drive a train for a living. Yes, the company I work for handles only freight, but if I was running a passenger train, I really wouldn't want my doctor, who happened to be riding that day, give me suggestions as to how to run the train. In the same way, I'm not sure he would be real receptive to me 'asking my doctor' about Drug X or Treatment Y. So why do the pharmaceutical companies spend all this money on advertising in non-medical journals? To get more people to pressure their doctor to prescribe over-priced medicines! So they can line their pockets some more! So when they get caught doing something the FDA doesn't like, they can pay a fine without hurting the stockholders!
And one other thing. What line in the budget in Washington gets the $2.3b? I'll bet it would make a nice down payment on the proposed health plans Congress is supposed to be working on!