Drug prices rise, as pharma prospers from tax law, group argues | STAT

WASHINGTON — A tax policy group here is trying to rally outrage over last year’s Republican-backed tax cut by pointing to one of its main beneficiaries: the pharmaceutical industry.

Americans for Tax Fairness, a coalition of left-leaning groups that advocate for placing a heavier tax burden on corporations and the wealthy, said in a report that drug companies are “among the biggest winners from the Trump-GOP tax cuts, but they are sharing few of the benefits with their employees and are offering no pricing relief to their customers.”

The group released a report calculating that five companies it analyzed would save a combined $6 billion in 2018 — and that 10 would save $76 billion in taxes on offshore revenue. Instead of passing those savings on to consumers or hiking employee wages, most companies have favored major stock buybacks or raising dividends. Drug prices have also continued to increase.

The tax bill, she said, led Johnson & Johnson to increase its planned investment in research and development by 15 percent over the next four years.

A Merck spokesman pointed to the company’s 2017 pricing transparency report, which also touted increased R&D spending and the introduction of a biosimilar the company said was priced 35 percent lower than its reference product.

A Pfizer spokeswoman similarly highlighted a one-time employee bonus that resulted from the tax cut, as well as increased capital investment in the U.S.

Read complete article here:

Drug prices rise, as pharma prospers from tax law, group argues.