Trewhitt said that the pharmaceuticals industry returns 20 percent of its sales to research and development efforts and is perhaps the most research-intensive industry in the world. He added that, like all other industries, the pharmaceuticals marketplace needs incentives for investment, and that incentive is the profit margins on drug sales. However, while that issue is debated, this bill could be passed and implemented quickly and provide immediate savings to senior citizens, according to Sullivan. He acknowledged that the bill does not require pharmacies to pass on savings, but said the pharmaceutical industry is very competitive and studies conducted by Allen's office have shown that market forces would cause the pharmacies to pass the savings on. He noted that, according to those studies, the pharmaceutical industry's net profit on sales is 16.75 percent compared with 2.25 percent for community pharmacies.
Pharmaceuticals is a very profitable industry.
Those who oppose the bill, including the Healthcare Leadership Council, said it would harm senior citizens. However, other health care advocacy groups, such as Families USA, support the bill. Judy Waxman, Families USA's director of governmental affairs, told Reuters Health that ideally, a prescription drug benefit should be added to Medicare, but in the meantime Allen's bill deserves consideration.