- Pharmaceutical companies now fund nearly 51% of the FDA's budget through user fees, creating a financial conflict of interest in drug regulation.
- Nine of the last ten FDA commissioners have left to work for or sit on boards of pharmaceutical companies.
- The NIH has received over $2.685 billion in royalty payments from drug companies between 2010 and 2023, incentivizing approval of NIH-developed technologies.
- Clinical trials costing tens of millions of dollars effectively create a "pay-to-play" system where only large corporations can afford drug approval.
- Americans spent $535 billion on prescription drugs in 2018, with prices rising 50% since 2010 while taxpayers fund basic research through the NIH.
The system that was built to fail
When former FDA Commissioner Dr. Herbert Ley stated that the public's perception of the FDA "are as different as day and night" from reality, he was describing a system that has only grown more compromised in the decades since. Today, the agency responsible for ensuring drug safety derives nearly 51% of its total budget from the very companies it regulates—pharmaceutical user fees alone fund 77% of the prescription drug review program. This financial entanglement, combined with a revolving door that has seen nine of the last ten FDA commissioners transition to pharmaceutical industry positions, has created a regulatory environment where public health protection takes a backseat to corporate profits.
The consequences are measurable. Americans spent $535 billion on prescription drugs in 2018, a 50% increase since 2010. Meanwhile, pharmaceutical companies spend roughly double on marketing what they invest in research and development, according to analysis from multiple sources including "Bad Pharma" by Ben Goldacre. The system has become what some analysts call "too big to fail"—so much wealth, so many careers and so large a share of the economy are tied to existing arrangements that virtually no one with power to change it can afford to do so.
How clinical trials became a pay-to-play game
Large randomized controlled trials—the gold standard for drug approval—cost tens of millions of dollars to conduct. This expense alone transforms drug approval into a process only large corporations can afford, creating enormous pressure to manipulate results to guarantee returns on massive investments. This system also often makes it impossible for natural medicines to be approved.
The problem extends beyond cost. Much cheaper trials that independent doctors could conduct have been shown to effectively detect clinically meaningful benefits. But regulatory standards do not permit this "low quality" research, meaning drug approval remains a pay-to-play situation achievable only by companies that can afford to invest in profitable pharmaceuticals.
Industry-supported research must be approached with skepticism. As former New England Journal of Medicine Editor-in-Chief Marcia Angell stated, "It is simply no longer possible to believe much of the clinical research that is published." Only about 40% of studies find their way into journals, and those showing positive results are far more likely to be published than those showing no effect or toxicity. This publication bias systematically distorts the medical evidence base.
The COVID-19 vaccine trials exemplified these problems. Despite claims of 95% effectiveness, the vaccines failed to meet their promised benefits, eventually pivoting to the more easily manipulated outcome of reducing "severe COVID." Countless datasets have shown their extreme danger, and numerous whistleblowers have come forward to testify that the trials were rigged.
The revolving door that never stops turning
A 2024 BMJ investigation found that nine of the FDA's last ten commissioners went on to work for or sit on the board of pharmaceutical companies. Every commissioner since 2000 has gone to industry. Among rank-and-file employees, a 2016 BMJ study found that 57% of FDA hematology-oncology drug reviewers who left the agency went to work for or consult with the pharmaceutical industry.
A 2018 Science investigation revealed that 11 of 16 FDA medical examiners who left after working on drug approvals took jobs with the very companies they had recently regulated. More recently, Peter Marks, who was directly responsible for stonewalling evidence of COVID-19 vaccine injuries, left the FDA to become a high-paid pharmaceutical executive. The 2021-2024 director of CDER, which oversees the review and approval of most new drugs in the U.S., left the FDA to become Pfizer's chief medical officer.
Honest scientists who challenge the status quo face retaliation. A FDA safety researcher was ostracized by management after his 2004 Senate testimony exposing the Vioxx catastrophe. Another FDA device reviewer was fired and covertly surveilled—the agency planted spyware capturing his emails, including messages to Congress—after he warned that certain breast cancer screening devices exposed patients to needless radiation. A group of nine FDA scientists wrote to President Obama that the agency had "ordered, intimidated and coerced" them to alter their scientific conclusions.
The NIH: From research institution to drug development pipeline
The National Institutes of Health, which controls most public research money in the country, has been transformed into what critics call a drug development pipeline. After laws passed in 1980 and 1986 permitted government employees and agencies to patent and profit off discoveries brought to market, the NIH began receiving massive royalty payments from pharmaceutical companies.
FOIA litigation revealed that over $2.685 billion in royalty payments flowed from pharmaceutical companies to NIH institutes and scientists between 2010 and 2023, with over $1 billion marked for individual inventors. This data had been kept hidden for decades until a federal court compelled its release.
This arrangement strongly incentivizes approval and protection of technologies the NIH helped develop, such as Remdesivir and Moderna's COVID-19 vaccine—Moderna has paid the NIH hundreds of millions in royalties. Meanwhile, Fauci was notorious for weaponizing the grant system, permanently cutting off scientists who challenged him and using grant approval as leverage for studies he wanted.
The cost of a broken system
The financial burden falls hardest on everyday Americans. A 2019 Centers for Disease Control and Prevention study found that 11.4% of adults aged 18 to 64 did not take their prescription drugs as prescribed to reduce costs. Insulin, a life-sustaining drug that has existed since the 1920s, now costs around $300 per vial in the United States—compared to $14 in India, $48 in Singapore, or $0 in Italy.
The U.S. government estimates that close to 1 million Americans in California alone go to Mexico annually for health care, including to buy prescription drugs. In May 2019, a group of Americans living with Type 1 diabetes traveled to Canada to purchase insulin and call on the U.S. government to regulate the cost of lifesaving drugs.
Pharmaceutical companies benefit from taxpayer-funded research, tax credits and patent protection while charging exorbitant prices. A 2018 study found that NIH contributed to published research associated with every one of the 210 new drugs approved by the FDA from 2010 to 2016—over $100 billion in NIH funding went toward research that contributed to those drugs.
Yet despite these taxpayer subsidies, drug manufacturers raised prices on more than 3,400 drugs in 2019 alone. Among the largest 25 pharmaceutical companies, annual average profit margins fluctuated between 15 and 20 percent, compared to 4 to 9 percent for non-drug companies among the largest 500 globally.
The unanswered question: What comes after the reckoning?
The evidence paints a damning picture: a regulatory system captured by the industry it oversees, clinical trials designed to produce favorable results, and a research establishment incentivized to protect rather than challenge the status quo. The pharmaceutical industry's relentless and often unlawful attempts to stifle competition cost American patients, insurers and federal health programs over $40 billion in 2019 alone, according to a report from the American Economic Liberties Project and the Initiative for Medicines, Access and Knowledge.
For those who understand that the Western "sick care" industry prioritizes profits over health outcomes, this is not surprising—but it is no less infuriating. The system was designed to produce these results, and it has succeeded brilliantly at its purpose. The question that remains is whether the American public, now increasingly aware of the corruption, can force a system that was never meant to prioritize their health to do so anyway. The answer may determine whether the next generation of Americans lives longer, healthier lives—or simply pays more for the privilege of being sick.
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