U.S. healthcare reform is biting into Big Pharma, at least for now. GlaxoSmithKline chief Andrew Witty (photo) quoted some numbers after the company released Q4 results yesterday: A total of $320 million over two years. That's not chump change.
"Last year, it cost GSK $170 million of lost sales, essentially in price reduction in the U.S. marketplace," Witty told CNBC. "In 2011, we'd expect another $150 million of price effect." Other major drugmakers have similar stories. Pfizer, Merck and Novartis, for three, all cited healthcare reform as a factor depressing 2011 sales growth.
These costs may seem to be fuel for the Republicans' fire to repeal, or at least cripple, last year's reform law. But Big Pharma agreed to these costs up front--remember that $80 billion deal with the Senate and Obama administration?--to gain access to the millions of newly insured patients the law would provide later. So, if opponents succeed in weakening that expansion of insurance coverage, then pharma will have all pain and little gain.
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