Stockholders protest Pfizer's drug prices

A US coalition of 275 faith-based organizations that control an estimated $100 billion in assets is targeting the pricing practices of a number of drug companies. The coalition previously led antiapartheid shareholder movements.

Charging that high drug prices are a “social justice problem,” the Interfaith Center on Corporate Responsibility (ICCR) submitted a proposal to “increase access to Pfizer products” at Pfizer's April 22 annual meeting. Although the proposal was defeated, it did receive 5% of the vote, surpassing the 3% required by the Securities and Exchange Commission to allow a proposal to be reintroduced the following year.

“This alerts the rest of the shareholders that this is a concern,” said Margaret Weber, coordinator of corporate responsibility for the Adrian Dominican Sisters, an ICCR member.

In its proposal, ICCR said price increases accounted for 1/3 of the increased spending on prescription drugs in 2001. The group's resolution sought to have Pfizer “contain the price of increases of its most-prescribed drug to levels equal to or below the annual rate of inflation.”

Pfizer board members unanimously opposed the resolution. Dr. Henry A. McKinnell, Jr., Chairman of Pfizer, who was paid $7 million in 2003 plus stock options and long-term payouts worth roughly $39 million, said groups like ICCR should focus on “disease costs” instead of “drug costs.”

“But if the cost of the cure makes it inaccessible then the cost of the disease only increases,” noted Weber.

The ICCR is also concerned by what it views as undue political influence exerted by the pharmaceutical industry. According to the Center for Responsive Politics, a US political watchdog organization, Pfizer gave $1.8 million in 2002 in soft money and Political Action Committee funds — an increase of 600% from 1992.

ICCR recently backed a proposal demanding a complete accounting of money given to politicians. It stated: “Our company should be using its resources to win in the marketplace through superior products … not because it has superior access to political leaders.”

The proposal, unanimously opposed by Pfizer's board, won 10% of the vote. Pfizer agreed to make the requested disclosures. Pfizer did not respond to interview requests for this article. — Jeanne Lenzer, Kingston, New York