The Continuing Danger From Progressive’s Faulty Excess Profit Allegations - Pacific Research Institute

The Continuing Danger From Progressive’s Faulty Excess Profit Allegations

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Pharmaceutical profits are competitive compared to what companies are earning in the broader economy.

Sen. Bernie Sanders (D-Vermont) and Rep. Alexandria Ocasio-Cortez (D-New York) continuously confirm Alexander Pope’s famous maxim about a little bit of knowledge. It truly is a dangerous thing, especially in the hands of politicians.

During a May 11th meeting of the Senate Health, Education, Labor and Pensions (HELP) committee, Sen. Sanders derided the profits of the U.S. pharmaceutical industry claiming, “Let’s not be naïve. The drug companies last year made $100 billion in profit. … Drug companies tell us that that money goes to research and development. More money went into stock buybacks, significantly more than research and development.”

Throwing out the $100 billion figure is, allegedly, a sign of malfeasance; or as Sanders might state, the profits are excessive. Excessive is, of course, a subjective term that he fails to define. But a closer look shows that pharmaceutical profits are competitive compared to what companies are earning in the broader economy.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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