Wednesday, October 14, 2015

The cost of doing business.

Business is, well, in business to make money. It's not rocket science, you buy or make something to sell, you sell it, and at a profit. Most people know that some products allow for larger profits than others, and those are the ones produced by the giant mega corporations. They know what they're doing, they've done it for some time and know that consumers everywhere will pay the prices and allow the giants to make mass quantities of money. The big ones are bottled water, at up to 4000% profit. Tobacco products are not as high, designer clothes are just about there, carbonated beverages, jewelry, eyeglasses and designer frames, non-unlimited plan text messages, coffee from retailers and of course, movie theater popcorn and drinks. All have just huge markups. 

And then there are prescription drugs. In America, the profit margins are in the 6000% range. At least that's based on production costs. Granted, there are costs associated with development of the actual drug itself being marketed; but also money that has to go into research on new drugs for the future. There is also marketing. In today's world, most of the big pharmaceutical companies spend more on marketing their products than they actually spend on research. (Washington Post)  So that eats into their profit margins. One of the weird things that ALL the big drug companies do though that also cuts into profits is pay the FDA huge fines for doing things that are illegal. (Wikipedia list) If you add all the fines up, it's very nearly 20 billion dollars. 

Think about that for a minute, TWENTY BILLION DOLLARS.

Now granted, most of that money was in civil penalties. A large part of it was for criminal fines. 

Not one single person, no CEO's, no Directors, no Managers, no one, went to jail.

For them, it's a cost of doing business.

The most profitable industry in the world believes that they need to do things to make even more money and so they willingly and continuously engender and promote activities that are illegal and if caught they are aware of that they will pay substantial monetary penalties. 

Don't you wish you made that kind of money and could just write off billions as a cost of doing business.

Time on why GlaxoSmithKline got stuck with a 3 billion dollar fine. (Time Mag Report)

There's something wrong with our world.


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