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Rep. Katie Porter Destroys AbbVie CEO's 'Big Pharma Fairy Tale'

AbbVie CEO Richard Gonzalez got the full Katie Porter white board and sticky note treatment.
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AbbVie CEO Richard Gonzalez got the full Katie Porter white board and sticky note treatment. As usual, it was glorious.

She began her questioning with some simple-enough questions about what they spent on R&D, executive compensation and other expenses, using round sticky notes to depict the amount of their revenue tossed into those buckets. Research and development is always the excuse pharma companies use for why they jack up prices on their drugs, and Porter was on a mission to destroy that "Big Pharma Fairy Tale."

After she got the little things out of the way, she tackled their marketing costs before hitting the Big Spender category: Stock Buybacks and Dividends. Gonzalez ducked, but Porter knew (they should know by now that Katie Porter ALWAYS knows) the number: $50 Billion.

How many times have we heard that pharmaceutical companies are entitled to high drug prices to recover their R&D costs? It's their knee-jerk response. And here we have it again from a CEO who obviously underestimated Rep. Katie Porter and her command of the facts.

AbbVie's Big Product is Humira -- a treatment for rheumatoid arthritis which is also used for other autoimmune diseases. Lawmakers are using AbbVie and the price of Humira as evidence that Medicare should be allowed to negotiate drug prices.

Reuters:

U.S. lawmakers on Tuesday accused the chief executive of AbbVie Inc (ABBV.N) of profiting from Americans by repeatedly raising U.S. prices on its widely-used Humira rheumatoid arthritis drug while cutting the price abroad.

The increases should prompt Congress to pass a law allowing the Medicare federal health plan to negotiate prices with drug companies, said Rep. Carolyn Maloney, chair of the House Oversight Committee.

The committee issued a staff report that said AbbVie exploited the U.S. patent system to fend off competitors and increased the price of Humira to $77,000 for a year's supply, while the price of its cancer drug Imbruvica was raised to $181,529 per year.

Or, as Porter observed: "You lie to patients when you charge them twice as much for an unimproved drug, when you tell us that R&D justifies those price increases. The Big Pharma fairy tale is one of groundbreaking R&D that justifies astronomical prices. But the pharma reality is that you spend most of that money making money for yourself and your shareholders."

I wonder how much AbbVie paid that guy to be raked over the coals by Rep. Katie Porter.

Twitter's observations:

You would think by now these CEOs would figure out that they should at least be prepared to face the Divine Rep. Porter. Apparently not.

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