Tag Archives: consumer

• Pharmaceutical Companies: Where Does the Money Go?

  Posted on October 10, 2011 by charlie in great

  It is quite easy to demonize pharmaceutical companies. After all these businesses largely profit by charging money for things that others desperately need. With that said the profits earned by these corporations do serve at least a few legitimate purposes. While tales of CEO overpayment are quite common few stop to think about the real costs associated with producing drugs. A good deal of the profits earned goes towards satisfying federal regulations researching new drugs and paying those that work for the companies. While these expenditures do not account for every penny earned they do go a long way towards showing why these companies charge as much as they do.ResearchThe line is touted over and over again but there is a great deal of truth to the idea that ‘big pharma’ puts a rather large percentage of its spectacular profits into research. This is somewhat less humanitarian in nature than the companies would like you to believe but still understandable; if pharmaceutical companies fail to come up with wonder drugs they fail to turn a future profit. It is also important to note that a fair bit of research comes to nothing leaving these companies with millions (and sometimes billions) of dollars in research with absolutely nothing to show for the effort.OverheadEvery company has its expenses and pharmaceutical companies are certainly no exception. While CEO salaries often border on the absurd there are still an astonishing number of people that must be paid for every drug on the Read more »

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