b. Intangible assets crowd out drug development.
Fernandez and Klinge April 2020. [Rodrigo, Ph.D., Researcher, SOMO; Tobias J., Ph.D. Candidate, University of Leuven; “The financialization of Big Pharma,” pp. 30-31, Centre for Research on Multinational Corporations (SOMO), https://www.somo.nl/wp-content/uploads/2020/04/Rapport-The-financialisation-of-Big-Pharma-def.pdf //cpsw-ay]
The combined value of all intangible assets on the balance sheet of 27 of the largest pharmaceutical companies has increased from 13 per cent of total assets in 2000 to 51 per cent in 2018, standing at a staggering US$857 billion dollars. This expansion of intangibles is an important aspect of the financialisation of Big Pharma. It shows how the sector has transformed itself from generating revenue through developing, producing and selling drugs to receiving income from owning and monopolising intellectual property. The large companies have spent years buying up competitors and biotechnology companies to boost pipelines, diminish competition and secure IPRs. As a result, Big Pharma increasingly operates more like a financial actor than an industrial sector.