Politics of Poverty

Big Pharma must put people over profits to end the COVID-19 crisis

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Photo: Oxfam Intermon /Pablo Tosco

Lifesaving medicines and vaccines should be free for all, not a luxury for the few.

Big Pharma—long-blasted for gouging prices, avoiding taxes, and rigging the political process to maximize profits—has emerged as key players in the race to bring an end to the COVID-19 crisis. Who gets access to lifesaving medicines and vaccines—and when—will determine who lives and who dies.

While governments worldwide have a duty to make treatments and vaccines available to all, it’s on pharmaceutical companies to play their part. Many like Johnson and Johnson (JNJ), Pfizer, and Gilead are working to develop these lifesaving innovations and have made some important overtures toward the goal of affordable and fair access to all.

But without proper incentives, these overtures will amount to little. Big Pharma’s “business as usual” model could make billions off taxpayer-funded research, charge sky-high prices, and funnel profits to wealthy investors. That could mean luxury for the few and disaster for the many.

So how do these companies make affordable and fair access to all a reality?

First, Big Pharma is flush—with the public’s tax dollars.

Taxpayers have invested millions of dollars in Big Pharma companies in recent months. JNJ received over half a billion dollars in public money in March to develop a COVID-19 vaccine and a potential antiviral. Taxpayers have doled out at least $70.5 million to Gilead for its drug. That’s on top of billions in dollars of tax cuts that various US pharmaceutical companies, including Pfizer, received from the Trump tax cuts before COVID-19.

The sector is also raking in sky-high profits, according to an Oxfam analysis of these companies’ earning statements filed at the US Securities and Exchange Commission. Pfizer— fresh off $16 billion in profits in 2019—is expected to make $2 billion more during the first three months of the COVID pandemic than their average earnings in previous years. JNJ is set to see a 41 percent earnings jump—a $5 billion spike in profits in 2020 compared to average recent yearly earnings. Gilead, while not yet reporting significant earnings gains compared to previous years, has increased profits by 22 percent during the pandemic.

Despite being financially flush, few of the companies have committed to provide the COVID vaccines at-cost. And there is worry that some companies may commit to a fair price for COVID medicines, but then jack up the price of other essential drugs people rely on.

Second, break down the COVID monopoly.

While many non-pharma companies have committed to the “Open COVID Pledge” to share patents and intellectual property during the pandemic, the most profitable pharma companies continue to insist on retaining monopoly control over their vaccines and medicines.

Hoarding the rights to produce lifesaving vaccines and medicines would allow these companies to drive up prices at will—now or in the future. If Gilead is allowed to retain exclusive control over the patent rights to its drug to treat COVID-19, the company could charge between $5,000 and $10,000 per patient. At those rates, people of modest means would have to choose between going bankrupt or taking the treatment. Maybe both. Either that, or taxpayers would have to pick up the bill.

Monopoly control could also prevent countries and other companies from collaborating to massively scale up production worldwide to meet demand. JNJ can by its own estimates only supply its COVID-19 vaccine to a small fraction of the world’s population by the end of 2021. If the goal is mass production of safe and effective vaccines, we need as many factories producing as fast as possible—without the need to ask for permission from large pharmaceutical corporations.

Third, change an America First mentality that will put people last.

Rather than prioritizing those most in need, some companies seem to be prioritizing specific countries and people. Gilead seems so far to have literally put America First by allocating the lion’s share of its current supply of its COVID drug to the Trump administration.

In turn, the administration seems intent on using its negotiating power to protect patent rights and to reject international efforts to ensure fair distribution of a new vaccine—a move which would benefit pharmaceutical companies at the expense of public health. This will only drive the death toll higher and may sow the seeds for even wider spread.

We cannot allow short-sighted nationalist rhetoric to divide us. Companies should join world leaders, who have called for a globally agreed, equitable distribution plan with a locked-in fairness formula so that supply is based on need. If companies can’t meet urgent production demands, they should allow and proactively work with others to step in to overcome shortages, reduce costs, and save lives.

Last but not least, end undue political influence.

Big Pharma remains a political powerhouse, continuing to flex its political muscle in Washington to protect profits. JNJ spent $1.5 million in Washington the first three months of 2020, and Pfizer a cool $4 million. Gilead spent more lobbying Congress and the administration in the first quarter of 2020 than any previous quarter on record.

In this unprecedented crisis—with more than 50 percent of Americans saying that drug companies shouldn't make profits at all from COVID-19 meds, we must ensure all drug companies put people over profits and hold human rights above property rights. Oxfam is calling on all pharmaceutical companies to make all COVID vaccines and medicines a global public good by:

  1. Committing to not profit from the COVID-19 pandemic, and cooperating with governments to make all medicines and vaccines free to all who need them here and around the world
  2. Forgoing monopoly control over all COVID-19 vaccines and treatments to allow for worldwide, low-cost production to meet the unprecedented demand
  3. Committing to support fair global distribution based on need, not price or nationality
  4. Becoming fully transparent about all public subsidies and tax incentives received, the true costs of producing vaccines and medicines, and all lobbying activities in the US and around the world

COVID-19 anywhere means COVID-19 everywhere. Sign our petition calling on Big Pharma and all drug companies to put people over profits.

Sign the petition
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