The high cost of advertising and administration is far exceeding U.S. drug companies’ investment in research and development.

Have you ever thought about how expensive it is to buy all of that national television advertising for prescription medicines? Or considered the effect of those advertising costs on the price of the medicines?

If you have, a recent study prepared by Families USA, a health care consumers group, may interest you. Using reports filed with the federal Securities and Exchange Commission by nine of the nation’s largest publicly traded drug companies, Families USA has come up with some interesting statistics:

l The U.S. drug companies spent more than twice as much money on marketing, advertising and administration as they spent on research and development (R&D) in 2001. The actual figures were $45.4 billion (yes, BILLION) spent on marketing, advertising and administration, compared with only $19.1 billion on R&D.

l The nine companies also collected far more in profits than they spent on R&D activities. The $30.6 billion in profits was more than 60 percent higher than R&D spending.

l Where did those profits go? A large chunk went to pay top executives. The five highest-paid drug company executives received more than $183 million in compensation, not including unexercised stock options.

With these figures in mind, it’s not surprising that the pharmaceutical industry has been America’s most profitable business for each of the past 10 years, according to Families USA. Their profits represented an 18.5 percent return on revenue nearly six times the median return (3.3 percent) for Fortune 500 companies.

Families USA is a nonprofit, nonpartisan group that says it “advocates for high-quality, affordable health care for all Americans.” The group undoubtedly has a viewpoint on the issue of high prescription drug prices, but its figures seem objective and its conclusions only confirm what has seemed obvious to most American consumers. That is that the high cost of advertising is contributing to the cost of prescription drugs without producing any additional health benefits for consumers. Drug companies have contended that the higher prices are essential to fund the research and development of new drugs for the American market, but the Families USA data seem to debunk that claim.

The nine companies that were studied produce the 50 drugs most often prescribed for senior citizens in America. This is particularly interesting in light of the recent rejection of legislation that would have added a drug benefit to Medicare coverage for seniors. The high cost of prescription drugs is forcing many seniors on fixed incomes to take less than the prescribed dosage or choose between buying medications or food. For people covered by other insurance plans, the cost of those drugs continues to drive up the cost of care and the price of premiums.

The large profits and huge CEO salaries reported by pharmaceutical companies seem to put them in the same category as other large American corporations that are being wracked by scandal. Those factors, along with the emphasis of advertising over research and development, add to Americans’ distrust of the companies and probably put the industry one step closer to additional government regulation.

Making a profit is part of doing business; greed is something else. It looks as if some of the nation’s drug manufacturers have crossed that line.