The ongoing global outbreak of COVID-19 has led to lockdowns in many places, bringing business and almost all activities to a standstill. It is now predicted that a major global recession looms ahead.
However, in the midst of all the confusion, things look promising for companies in the pharmaceutical industry. Anyone of these that manages to find a cure for COVID-19 looks to make a huge killing, judging by existing arrangements.
Big Pharma smiling to the bank with large profits may be the last thing to worry about right now. But past experiences make some people worry about the possible cost of a cure that might be found.
Opportunity to make tons of money
Pharma companies have a reputation for seeking huge profits seemingly at the expense of the sick. And they only go after finding cures they are sure of making so much profit from, according to some observers.
Drugmakers cannot be faulted entirely, though. They are just like any other businesses set up to make a profit. The only problem many people have with them is that they think that these companies can often be quite exploitative in their dealings.
The COVID-19 pandemic has already led to a surge in the demand for medical-related products. These include face masks, hand gloves, and respirators.
Drugmakers are also conducting trials to see how they could repurpose their existing drugs to fight the pandemic. It is another opportunity to make money with what they already have.
The race to find a cure for the coronavirus infection is in overdrive at the moment. Pharma companies are vying to be the first to find a solution, knowing that the rewards will be humongous. They have increased their investment in this direction.
By contrast, there are certain medical conditions that Big Pharma has not paid attention to due to lower profit potential while people die from them. Diseases that mostly affect poorer countries of the world typically get little attention for this reason.
Tuberculosis, a disorder that mostly kills the poor, still doesn’t have a cure because of its low-profit potential, according to an op-ed published by The Guardian. Also, Ebola did not receive much attention, if any, until the outbreak years ago that impacted some developed countries.
U.S. President Donald Trump recently made the headlines for exhibiting similar self-interest as these companies to the possible detriment of others. He tried to acquire exclusive rights to a potential vaccine for COVID-19 for Americans.
Bernie Sanders recently said Big Pharma is already relishing the prospect of how much money it could make for finding a solution to the coronavirus. The Democratic senator described the industry’s leaders as “a bunch of crooks.”
Coronavirus Takes a Toll
Contrary to the views of people like Senator Sanders, some people have been quick to point out that Big Pharma is a necessary evil. Pharmaceutical companies are still the hope of the world, they say.
The pandemic has affected more than 475,000 people, as of writing, and led to more than 21,300 deaths. There are lockdowns in many places across the globe.
The current outbreak has taken a huge toll on economic activities. Millions of people are reportedly out of work because of it already. There is also the fear of a global recession as a result.
Stock markets are down in many countries as investors try to protect their money. Indexes, such as the Dow, the FTSE, and the Nikkei have fallen drastically since the outbreak was first reported in December. The FTSE and the Dow have recorded their biggest one-day drops since 1987, the BBC News reports.
According to the New York Post, a minimum of 10 percent decline in output is likely in the first quarter.
“What would we pay for a vaccine to render all this needless,” asks Rich Lowry in an op-ed published by the New York Post. “Even if it were a trillion dollars, the price of the Trump-proposed stimulus package, it would be a bargain.”
Greater Control by Government Needed
A major issue that opponents of Big Pharma have with these companies is that they profit at the expense of the public. This is considering the amount of taxpayers’ money that goes into research for drugs.
Gerald Posner, who wrote “Pharma: Greed, Lies, and the Poisoning of America,” told The Intercept that the National Institutes of Health (NIH) has pumped about $900 billion into research since the 1930s. Pharma companies went on to use the research to make patented drugs that they sold under their brand names.
The hepatitis drug sofosbuvir, the cancer treatment Kymriah, and the HIV medication AZT are examples of products that benefited from public-funded research. They currently command very high prices.
The U.S., through the NIH, has expended more money than any other country on coronavirus research since the SARS outbreak of 2003, according to a NY Times op-ed.
Pharmaceutical companies in America, in particular, usually have a field day due to the absence of strict price regulation. The U.S. does not have the sort of price controls that some other countries have in place. As a result, drugmakers enjoy greater freedom to set whatever price they feel.
The government gives drug companies exclusive rights to carry out later-stage research without requiring that they make drugs that come out of it affordable. Yet, lots of public money is spent on trials. The companies practically enjoy a monopoly, on the taxpayers’ money, that lets them charge high prices.
Some legislators in the U.S. have called on the government to put a cap on prices that Big Pharma charges. But other lawmakers, especially Republicans, are not in support of price controls.
US Health Secretary Alex Azar, who used to head the drugmaker Eli Lilly’s U.S. operations, disclosed recently that there was no guarantee that treatments or vaccines for the coronavirus would be affordable, the New York Times reports. However, he seemed to change his stance afterward after seeing the public’s reaction to his statement.
On his part, Sanders wants the government to make any coronavirus vaccine that is discovered available for free in America.
The groups that are most affected by the COVID-19 pandemic are, in many cases, those likely to afford expensive treatments. They include the elderly, those with existing medical conditions, prisoners, homeless people, and persons excluded from public healthcare budgets.
Lowry thinks any vaccine for coronavirus might not cost too much. This is because COVID-19 affects more people than certain disorders that are awfully expensive, according to him. The average cost to patients reduces.
How Big Pharma Will Profit From the Coronavirus – The Intercept (https://theintercept.com/2020/03/13/big-pharma-drug-pricing-coronavirus-profits/)
Opinion | Drug Companies Will Make a Killing From Coronavirus – The New York Times (https://www.nytimes.com/2020/03/18/opinion/coronavirus-vaccine-cost.html)
Trump’s attempt to buy a coronavirus vaccine shows why big pharma needs to change | Diarmaid McDonald | Opinion | The Guardian (https://www.theguardian.com/commentisfree/2020/mar/16/trump-coronavirus-vaccine-big-pharma-president-drugs-industry-profit)
Say thanks to ‘greedy pharmaceutical companies’ — they’re our best coronavirus hope (https://nypost.com/2020/03/19/say-thanks-to-greedy-pharmaceutical-companies-theyre-our-best-coronavirus-hope/)
Coronavirus: A visual guide to the economic impact – BBC News (https://www.bbc.com/news/business-51706225)