I'll put this here instead of under your comments on my Utopia since my Utopia is fictional.

I used Pfizer for my research since I'm well familiar with them. Please understand that I worked for a Clinic which did clinical research on Cholesterol-lowering drugs and was one of the important sites involved in the research that led to the approval of Merck's cholesterol-lowering drug which, if memory serves, was the first major one and led to Merck's stock going through the roof the day of the FDA approval. Had I only had a few shares of Merck that day, I'd have been rich. I'd also have been in jail for insider trading but oh well...

I have dealt with drug companies intimately and with drug reps (jokingly called drug dealers). On the one hand, I had some good experiences there. OTOH, I saw what they were about and what their failings were. I saw where their money went for promotion. They spent a major amount of money every year funding talks by my boss all over the world. To be fair, he NEVER promoted their drug in any of his talks but presented research data and info for doctors for prescribing. However, at every talk, there was a pharma representative there to do the PR with the M.D.'s who do the prescribing. The Pharma companies paid for these doctors and often their wives to attend things like baseball games, football games, live theater, etc., etc. plus trips to vacation spots like Phoenix or Florida in winter, San Diego, etc., etc.

In recent years, the FDA has clamped down on a lot of that but you'll never even have any idea of how much money was spent for items like that under marketing. And it was damned effective.

The drug reps I dealt with I really enjoyed. Many of them became a bit more than merely acquaintances and I enjoyed their company. But I have no blinders on about Big Pharma and I know how they have lobbied and tried to screw the U.S. consumer, making us pay for their often obscene profits.

They lobbied on the Medicare and Prescription Drug, etc. Act of 2003 so that the government could not negotiate discounts on drugs, effectively screwing Seniors who can least afford the high price of drugs. Wikipedia on that act.

There is a lot of information below along with the links. The last part is Pfizer's actual Financial Statement for 2009 and I defy you to try to excuse your way out of that, Tom. Don't even try to argue with me on this. Your condescension was duly noted but you'll never win an argument with me on this any more than I would try to win one with you on something techie. I worked in this area for over 20 years. I had to keep my mouth shut since my bread and butter came indirectly from Big Pharma but I'm retired now. While I agree that everyone has the right to make a profit, I do not have to agree with or like the way they go about it when the cost is too high for some segments of society. Big Pharma has a lot of ethical problems as you can see from some of the following info. I apologize for the length of some of this but that's the nature of the beast. There's a lot out there and a lot more than I'm quoting here.

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Wikipedia
^Pfizer is one of the single largest lobbying interests in United States politics. For example in the first 9 months of 2009 Pfizer spent over $16.3 million on lobbying US congressional lawmakers, making them the sixth largest lobbying interest in the US (following Pharmaceutical Research and Manufacturers of America (PhRMA), which ranked fourth but also represents many of their interests). A spokeswoman for Pfizer said the company “wanted to make sure our voice is heard in this conversation” in regards to the companies expenditure of $25 million in 2010 to lobby health care reform.[37]
Pfizer's primary interests are opposition of Congressional efforts to attach a prescription drug benefit to Medicare and opposition to generic drugs entering US markets.[38] Pfizer also purportedly proposed a ban on all lawsuits against manufacturers of body implant parts which was proposed in the United States Congress as part of tort reform legislation.[39]
According to U.S. State Department cables released by the whistle-blowing site WikiLeaks, Pfizer "lobbied against New Zealand getting a free trade agreement with the United States because it objected to New Zealand’s restrictive drug buying rules and tried to get rid of New Zealand’s former health minister, Helen Clark, in 1990.[40][41]
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In September 2009, the United States Department of Justice announced that Pfizer had agreed to pay $2.3 billion to settle civil and criminal allegations that it had illegally marketed four drugs: Bextra, Geodon, Zyvox, and Lyrica "with the intent to defraud or mislead" by promoting the drugs for non-approved uses[examples needed]; this marks Pfizer's fourth such settlement in a decade.[5][6][31] Pharmacia & Upjohn Company, Inc., a Pfizer subsidiary, agreed to plead guilty to mis-branded promotion of Bextra, a felony violation of the Food, Drug and Cosmetic Act. The criminal fine accounts for $1.3 billion of the settlement, and is the largest criminal penalty ever imposed in American history.[46] Pfizer has entered an extensive corporate integrity agreement (CIA) with the Office of Inspector General and will be required to make substantial structural reforms within the company, and maintain the Pfizer website (www.pfizer.com/pmc) to track the company's post marketing commitments. Pfizer must also put a searchable database of all payments to physicians the company has made on the Pfizer website by March 31, 2010.[47] In addition, two former employees were separately indicted and sentenced for their role in marketing of Bextra. A former District Sales manager was found guilty of obstruction of justice for destroying documents pertinent to the investigation, and a Regional Sales Manager pled guilty to the distribution of a mis-branded product.[48][49]
The case is the largest civil settlement against a pharmaceutical company as well.[50] Pfizer paid a $1 billion civil fine to settle allegations it had illegally promoted the drugs for uses that were not approved by the U.S. Food and Drug Administration (FDA) and caused false claims to be submitted to Federal and State programs including but not limited to Medicare and Medicaid. Under the False Claims Act, damages can be assessed for violations of the federal Anti-Kickback statute, 42 U.S.C. § 1320a–7b(b)[51] and the off-label marketing provision within the Federal Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. §§301-97.[52] Six whistle-blowers will receive $102 million for their participation in the civil investigation, and John Kopchinski, a former sales representative, will receive $51.5 million for his allegations involving the marketing of Bextra.[53]
CNN reported that Pharmacia & Upjohn, not Pfizer itself, pleaded guilty because prosecutors thought Pfizer was "too big to nail." Companies convicted of major health care fraud are automatically barred from billing Medicare and Medicaid for their products. Prosecutors feared that Pfizer would collapse if it pleaded guilty, and felt that the risk of harm to patients was too great. A CNN investigation revealed that Pharmacia & Upjohn Company is little more than a shell corporation Pfizer uses to plead guilty; it was first created in 2007 as the defendant in a kickback case.[54]

Pfizer's human research and development organization is headquartered in New London, CT while their animal health research and development organization is headquartered in Kalamazoo, Michigan. The company has R&D labs in the following locations: Groton, Connecticut; Sandwich, England; La Jolla, California; South San Francisco, California; Cambridge, Massachusetts; Kalamazoo, Michigan; St. Louis, Missouri. In La Jolla, Pfizer has 1,000 people with plans to create cancer drugs, a departure from the company's cardiovascular specialties.[75]
Spending $8.1 billion in research & development (R&D) in 2007, Pfizer has the industry's largest pharmaceutical R&D organization: Pfizer Global Research and Development.[76]
^
Pfizer Marketing.
^(1/6/05)-According to Verispan, a health-information company, drug companies spent about $8 billion on "detailing" to office based physicians for the 12 month period of time ended October 2004.. "Detailing" involves dropping off free samples at the doctor's office by the drug companies sales people, while at the same time trying to educate the doctors and their staff as to the advantages of the product. That is more than double the increase from 1996 when Verispan estimated that the drug companies spent about $3.6 billion in "detailing".

Departing Representative Billy Tauzin (Rep.-La.), a onetime Democrat who became a Republican in 1995, will become president of the Pharmaceutical Research and Manufacturers of America (PhRMA). PhRMA is the retail trade-lobbying arm for the pharmaceutical industry. Mr. Tauzin was a major force in the passage of the Prescription Drug Law that was enacted on December 8, 2003.
The 61-year old Mr. Tauzin will replace Alan Holmer in January 2005 at an estimated salary of $2 million a year. Under present rules of ethics in Congress he will be barred from lobbying members of Congress for one-year, but he is free to lobby the administration and Medicare officials. He can make campaign contributions to members of Congress and can interact with them socially. In January he turned down an offer to succeed Jack Valenti as president of the Motion Picture Association of America. Dan Glickman, a House member from 1977 to 1995 took the job.
(11/6/04)- Former secretary of health and human services Tommy G. Thompson told an audience of medical professionals in 2001that there is no reason why they should be prescribing Nexium, AstraZenca's next generation of drug to Prilosec for acid reflux. Both drugs are very chemically similar. The patent for Prilosec had expired so the drug became available as on over-the-counter medication at a cost nowadays of about $40 per month. Here it is 3 years later and mainly because of an advertising campaign for Nexium that cost $257 million in 2003, according to the research firm of Nielsen Monitor-Plus, the drug is the 7th best selling prescription drug in this country. Its sales were $3.1 billion in this country last year and it continues to grow this year. It is estimated that the drug industry spent over $3.8 billion on advertising last year.
(10/8/2004)-On September 17, 2001 the FDA sent a warning letter to Merck & Co. saying "in a promotional campaign for Vioxx that minimizes the potentially cardiovascular findings that were observed" in a clinical trial comparing Vioxx to naproxen, a much cheaper painkiller. The letter went on to allege that the promotional campaign failed to inform the consumer that Vioxx had a four-to-five times increased risk for heart attacks than did users of naproxen.
The reason why we point out this example of a warning letter to a drug company involves the issue of promotion of an expensive brand name drug as compared to the non-advertising of cheaper alternative medicines that may be just as beneficial to the consumer. Keep in mind the drug companies spend hundreds of millions of dollars to advertise their products to the consumer. Keep in mind also that the rest of the western world does not allow its drug companies to advertise their products directly to the consumer. Generic companies do not as a rule advertise their products since they constantly are striving to keep their costs down.

It wasn't until the federal government passed legislation in 1997 that legalized advertising by the drug companies directly to the consumer. Before the enactment of this law the drug companies had to advertise in medical journals only. Over the ensuing years, as we have written about in this article, the drug companies have consistently increased their budgets for advertising at a far larger percentage than they have for new discoveries.

The pharmaceutical industry continues to increase the amount of money it is spending to advertise their products. Ad spending on prescription drugs rose 24% last year to $3.2 billion, according to TMS Media Intelligence/CMR. There seems to be no let up in sight since the first half of 2004 saw an increase of 30% over a comparable period in 2003.
Pfizer Inc. announced that it had retained the William Morris Agency to come up with entertainment-marketing ideas, including embedding Pfizer products in movies and television programs. Please keep in mind that the 1997 law that allowed direct-to-consumer advertising requires that the negative side effect of the drug be included in the ads.

The Bush administrations' promotion of the new Medicare law is a violation of the law that prohibits the usage of public funds for propaganda purposes according to a report by the General Accounting Office (GAO). The videos appeared as if they were news releases, when in fact they were actually ads to accentuate the positives of the new law.

Ad spending by prescription drug companies grew by 21% last year to $3.43 billion,

Dr. Franklin further alleged that Warner gave financial incentives to hundreds of physicians to prescribe Neurontin for unapproved uses, by inviting them to dinners and weekend trips to resorts. Doctors were paid to speak about Neurontin and encourage its usage for off-label purposes. It is alleged that each doctor was paid $350 or more for each day they let sales people watch as they examined their patients. The federal investigation alleges that Medicaid paid many millions of dollars for Neurontin prescriptions written for unapproved uses.

The report went on to further state that the drug companies spent much more on research and development then they did on advertising. Last year the companies spent $30.3 billion on research and development and $19.1 billion on all promotional activities, including $2.7 billion on direct-to-consumer ads. As we point out however the drug companies make much more in net income than they spend on R&D. As the report also points out, the ad spending rate is increasing at a far greater rate than is spending for R&D.^

Note from Patricia on the above paragraph: It was cited by an MD researcher (unable to find source at the moment) within the last 5 years that most Big Pharma companies hide some of their marketing expenses among the R&D expenditures.

^The study found that a diuretic, chlorthalidone, was more effective in preventing fatal and nonfatal heart attacks than were three other classes of drugs: amlodipine (sold as Norvasc, a calcium channel blocker; lisinopril (Zestril and Prinvil), an ACE inhibitor; and doxazonsin (Cardura), an alpha-adrenergic blocker. Diuretics are generic drugs sold by companies that do not spend money on marketing. The diuretics have lost their patent protection, so the brand name drug companies do not actively market this drug.
In 1999, researchers at the Massachusetts General Hospital reported that calcium-channel blockers were the most heavily advertised drug in the New England Journal of Medicine in 1996, while there were no ads in there at all for the diuretics. Analysts feel that the drug makers will continue their spending on their drugs that deal with hypertension as additional treatments for heart patients who need more than one drug to control their blood pressure.
According to the results of a study done by Datamonitor, a marketing analysis firm, the 14 top drug companies generated $17 in sales in 2001 for each dollar that they spent on marketing in this country, down from $22.20 for each dollar that they spent in 1998.
The report went on to further indicate that promotional spending in the U.S. by these largest drug companies increased at an average annual rate of 32.4% from 1998 to 2001. On the other hand the industry's annual increases in research and development increased by 8.2% in 1999 to 16.6% in 2001 according to data from PhRMA, the industry's trade association.

The above directly affects me so I may speak with my cardiologist about it. She is the last word on it for me but I think a discussion is in order.

The drug industry spent over $9 billion on direct marketing to consumers and to health professionals according to the Datamonitor study. Datamonitor recommended that either the industry should reduce its promotional spending, or find more effective ways to spend its money. In France and England, marketing spending fell at an annual rate of around 4% from 1998 to 2001. From August 1997 through August 2002, the FDA issued 88 letters accusing drug companies of advertising violations. 44 of the violations were for broadcast advertisements, 35 for print ads and 9 that cited both types of ads.

"Most pharmaceutical companies make considerably more in net income than they spend on R&D. Indeed, the pharmaceutical industry continues to be the most profitable U.S. industry, with profit margins in 2000 nearly four times the average of Fortune 500 companies." The report also discusses the pay and compensation level of the top executives of some of the drug companies. According to the report "All of the nine U.S. pharmaceutical companies that market the top-selling 50 drugs for seniors spent more money on marketing, advertising and administration than they did on R&D." According to the report the percent of revenue allocated to marketing/advertising and administration compared to percent allocated to R&D is as follows:

Company Mktg/Adv/Adm R&D
Merck 15% 6%
Pfizer Inc. 39% 15%
Bristol-Myers 30% 11%
Pharmacia 37% 15%
Abbott Labs 21% 10%
Wyeth. 38% 13%
Ely Lilly 30% 19%
Schering-Pl 36% 14%
Allergan, Inc. 42% 13%
As you can note from the above, 8 of the 9 companies spent more than twice as much on marketing, administration and advertising as they did on R&D.

When we examine some of the figures from some of the individual drug companies in regards to the increase in the percentage of their revenues spent for marketing and administrative costs we see that it far exceeds the percentage spent on research. In the year 2000 GlaxoSmithKline spent 37.2 % of its revenue on advertising, marketing and administrative costs versus the 13.9% spent on research. Bristol-Myers Squibb spent 30.4% of its revenue in 2000 on advertising, marketing and administrative expenses versus spending 10.6 per cent on research.

She states in the article: " A 1998 survey of named authors writing for some of the nation's top journals, including The Journal of the American Medical Association, which published the survey, found that 11 percent of the articles had been ghostwritten." She went on to state that "just $2.8 billion of the $11.8 billion the drug industry spent on marketing was aimed at consumers; the rest paid for everything from dinner meetings with doctors to sales calls and medical education, according to Verispan, a health-care information company." She concluded the article with the statement: " In Washington, the FDA's new chief counsel, Daniel E. Troy, who fought restrictions on drug promotion as a private lawyer, is leading a review of regulations that could relax existing limits on behind-the-scenes marketing of drugs."

The industry spends about twice as much for marketing and administration as it does for research and development. This year drug makers will spend $26 billion, or 20 % of revenue, finding new drugs and then winning approval for them. The industry utilizes about 70,000 U.S. salespeople costing nearly $7 billion per year. Prescription drug sales totaled in excess of $100 billion for the first time in 1999.
^
MASOOD I, IBRAHIM MIM, HASSALI MA, AHMED M. EVOLUTION OF MARKETING TECHNIQUES, ADOPTION IN PHARMACEUTICAL INDUSTRY AND RELATED ISSUES: A REVIEW. Journal of Clinical and Diagnostic Research serial online
2009 December [cited: 2009 December 7]; 3:1942-1952.]

Pfizer's 2009 Financial Statement:

Page 16 - The figures below will run together due to damn Tiki Wiki so read it in the original from the link above.

Analysis of the Consolidated Statements of Income
YEAR ENDED DECEMBER 31,
% CHANGE
(MILLIONS OF DOLLARS) 2009 2008 2007 09/08 08/07
Revenues $50,009
Cost of sales 8,888 - % of revenues 17.8%
Selling, informational and administrative expenses 14,875 - % of revenues 29.7%
R&D expenses 7,845 - % of revenues 15.7%

Patricia's note: R&D % of Revenue 15.7%