The world's biggest drug company, which will soon get even bigger when it swallows Wyeth, is in a giving mood.
PFE announcedthis morning that it's raising the income levels for uninsured people to qualify for cheaper or free drugs because of the bad economy.
For example, a single person previously had to make as little as 30-grand a year to be eligible, now that figure is $45,000. The program is in conjunction with "Together Rx Access" and includes a bunch of other pharma companies and hundreds of drugs.
The Kaiser Family Foundation estimates that as the unemployment rate has gone up over the past year three million more Americans have lost their health insurance. "More individuals and their families are feeling the impact of the economic crisis through the loss of jobs and healthcare benefits," the director of Pfizer Helpful Answers, Gary Pelletier, is quoted as saying in the press release.
Indeed, yesterday Credit Suisse pharma analyst Catherine Arnold put out a research note saying the recession is hurting cholesterol drug sales. "Consumer Reports" this week released the results of a poll showing that 28 percent of Americans are not filling their prescriptions, skipping doses and/or cutting their pills in half to save money. And IMS Health, which monitors prescription trends, this morning reported that drug sales and dispensed prescription growth slowed last year to 1.3 percent and 0.9 percent, respectively. IMS fingers "higher demand for less-expensive generic drugs, lower new product sales, and reduced consumer demand due to the economic downturn."
Expanding access to prescription drugs whether it's through programs like this one and/or through government healthcare reform will squeeze profit margins. But the industry maintains that it can make up in volume what it might lose on price. For the moment, AIG is the whipping boy of Washington. Big pharma knows it could be next.
In the meantime, it's doing whatever it can to try to bolster its image.
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