PPI - Radically Pragmatic
  • Donate
Skip to content
  • Home
  • About
    • About Us
    • Locations
    • Careers
  • People
  • Projects
  • Our Work
  • Events
  • Donate

Our Work

WSJ: The Folly of Targeting Big Pharma

  • December 11, 2015
  • Michael Mandel

An unfortunate refrain among Democratic presidential hopefuls is that rapacious pharmaceutical and biotech companies are driving up the cost of essential medications, bankrupting the health-care system, and depriving sick Americans of treatment. Hillary Clinton has honed her message to a nice sound bite: Drug companies that charge excessively high prices “are making a fortune off of people’s misfortune.”

A report released Dec. 2 by the Centers for Medicare and Medicaid Services shows a 12.2% increase in spending on prescription drugs in 2014 after an average 2% increase for the previous six years. As the CMS report clearly states, “the rapid growth in 2014 was due to increased spending for new medications (particularly for specialty drugs such as hepatitis C).” Yet the increase, combined with reports of drug companies attempting to jack up prices on existing drugs, has some calling for full-blown government price controls.

The way we pay for innovative drugs can certainly be improved. But the anger directed at the pharmaceutical and biotech industries overall is misdirected. The single biggest driving force for increased health-care spending in the U.S. is the rising cost of labor, not drugs. According to data from the Bureau of Economic Analysis and estimates by the Progressive Policy Institute, total labor compensation at hospitals, doctors’ offices, ambulatory care facilities and nursing homes has risen by roughly $270 billion since 2007, including the amount paid to doctors and dentists who own their own practices.

Continue reading at the Wall Street Journal.

Related Work

Blog  |  September 17, 2025

This Week in RFK Jr.’s Vaccine Conspiracy Theories

  • Alix Ware
Press Release  |  September 10, 2025

PPI Report Finds That Socioeconomic Impact of Legalized Sports Betting is Less Harmful Than Feared

  • Michael Mandel
Publication  |  September 10, 2025

Balancing Innovation and Risk: The Case of Legalized Sports Betting

  • Michael Mandel
Blog  |  September 5, 2025

Some Thoughts on Homeownership, Credit Scores, and Policy Myopia

  • Paul Weinstein Jr.
Blog  |  September 3, 2025

RFK Jr. Wants Us to Trust Health Tracking Devices and Apps. Should We?

  • Orsi Feher
Op-Ed  |  August 22, 2025

Manno for Philanthropy Daily: A Donor Playbook for Local Workforce Renewal

  • Bruno Manno
  • Never miss an update:

  • Subscribe to our newsletter
PPI Logo
  • Twitter
  • LinkedIn
  • Facebook
  • Donate
  • Careers
  • © 2025 Progressive Policy Institute. All Rights Reserved.
  • |
  • Privacy Policy
  • |
  • Privacy Settings