Pfizer and GSK increase prices to boost revenues

Pfizer and GlaxoSmithKline (GSK) have increased the prices of their pharmaceutical products to increase their revenues as prescriptions begin to slow on their best-selling drugs, it has emerged.

Wholesale prices in the US have increased nine per cent for the firms’ top ten selling drugs during 2007, eclipsing consumer price inflation of 4.2 per cent for the year according to Thomson Corp figures, Bloomberg reports.

The financial news site claims that these price increases prevented more pronounced drops in US revenues, while it quotes industry critics warnings that wholesale price increases are not a sustainable method of maintaining revenues.

Jon Rother, director of public policy for non-profit group AARP, said: “The only way they can keep up their financial picture is to raise prices on the current drug.

“That is a short-term strategy, but that seems to be what they are doing because they don’t have new products.”

Managing partner at healthcare investment fund Sio Capital Management added that price increases are only a short-term mechanism to offset a current lack of innovation.

In January 2008, Pfizer announced its full-year fiscal statement, recording global revenues of $48.6 billion (24.5 billion pounds), up from $48.4 billion a year earlier.