Six Months after Trump Tax Cuts Signed into Law, Updated Booker Report Shows Drug Companies Still Not Using Windfall to Reduce Drug Prices
Booker report released in April showed no efforts by big drug companies to reduce drug prices using Trump tax savingsJune 22, 2018
WASHINGTON, D.C. – The largest pharmaceutical companies in the country still haven’t announced any plans to pass along any of their huge windfall from the Trump tax cuts along to consumers in the form of lower drug prices, according to an updated report issued today by the office of Sen. Cory Booker (D-NJ).
In April, after reviewing transcripts of the fourth quarter earnings calls and other public forecasting statements of the 10 largest US-based pharmaceutical companies -- Pfizer, Merck & Co., Johnson & Johnson, Gilead Sciences, AbbVie, Amgen, Bristol-Myers Squibb, Eli Lilly & Co., Celgene, and Mylan -- Booker’s office issued a 15-page report finding no evidence that the companies were planning on using any of their Trump tax windfall to lower the price of prescription drugs for consumers.
Instead, half of these firms planned to use their corporate tax savings to repurchase shares of their own stock, a mechanism used to boost stock prices for shareholders. These announced stock buybacks totaled $45 billion.
Now, after reviewing the companies’ 2018 first quarter earnings calls and other public forecasting statements, Booker’s office has issued an addendum to the original report again finding no plans to use tax savings to reduce prescription drug prices. One company – Celgene – announced a second round of stock buybacks in the amount of $3 billion, meaning the 10 drug companies covered by the report have issued a total of $48 billion in stock buybacks without a corresponding effort to lower drug prices.
“Six months after the Trump tax cuts for corporations and the wealthiest Americans were sold to the public as a windfall that would ‘trickle down’ to everyone else, it’s clear they’ve overwhelmingly benefited only those at the top,” Booker said. “This updated report offers another stark example. Rather than use their big tax cut to reduce drug prices, drug companies are instead still buying back stock to benefit their shareholders.”
As he did in April, Booker sent the updated report to the CEOs of the 10 drug makers, again urging them to combat skyrocketing drug prices.
Booker’s ongoing oversight of the pharmaceutical industry is an extension of his legislative efforts to lower consumer drug prices for the millions of New Jerseyans and Americans who struggle to afford their medicine.
Last year, Senator Booker introduced a bill – the Affordable and Safe Prescription Drug Importation Act – with Senators Bernie Sanders (I-VT) and Bob Casey (D-PA) that would allow Americans to import safe, low-cost medicine from Canada and other advanced countries. Booker is also a sponsor of legislation that would allow Medicare to negotiate lower prescription drug prices, make it easier to get generic drugs to market, and make other key reforms to bring down high drug costs.
The full updated report can be viewed at the following link: https://www.scribd.com/document/382351279/Pharma-Tax-Report-6-21-With-Addendum
The addendum alone can be viewed at the following link: https://www.scribd.com/document/382351256/Addendum-6-21
The letter to the drug company CEOs can be viewed at the following link: https://www.scribd.com/document/382351296/Abbvie
# # #