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HEARINGS

BEFORE THE

SUBCOMMITTEE ON ANTITRUST AND MONOPOLY

OF THE

COMMITTEE ON THE JUDICIARY

UNITED STATES SENATE

EIGHTY-SIXTH CONGRESS

SECOND SESSION

PUBSUANT TO

S. Res. 238

PART 26

ADMINISTERED PRICES IN THE DRUG INDUSTRY

(ANTIBIOTICS-APPENDIX B)

Printed for the use of the Committee on the Judiciary

U.S. GOVERNMENT PRINTING OFFICE

35621 0

WASHINGTON : 1961

For sale by the Superintendent of Documents, U.S. Government Printing Office

Washington 25, D.C. - Price $3.50

COMMITTEE ON THE JUDICIARY

JAMES 0. EASTLAND, Mississippi, Chairman ESTES KEFAUVER, Tennessee

ALEXANDER WILEY, Wisconsin OLIN D. JOHNSTON, South Carolina

EVERETT MCKINLEY DIRKSEN, Ilinois JOHN L. MCCLELLAN, Arkansas

ROMAN L. HRUSKA, Nebraska JOSEPH C. O'MAHONEY, Wyoming

KENNETH B. KEATING, New York SAM J. ERVIN, JR., North Carolina

NORRIS COTTON, New Hampshire
JOHN A. CARROLL, Colorado
THOMAS J. DODD, Connecticut
PHILIP A. HART, Michigan

SUBCOMMITTEE ON ANTITRUST AND MONOPOLY

ESTES KEFAUVER, Tennessee, Chairman JOSEPH C. O'MAHONEY, Wyoming

EVERETT MCKINLEY DIRKSEN, Illinois JOHN A. CARROLL, Colorado

ALEXANDER WILEY, Wisconsin PHILIP A. HART, Michigan

ROMAN L. HRUSKA, Nebraska

PAUL RAND Dixon, Counsel and Staff Director

II

CONTENTS

EXHIBITS AND APPENDIX*
Charts by American Cyanamid Co.:

1. Cyanamid's expenditures for drug research have risen steadily Page
during the last 21 years.

13625
2. New drug developments are a must for Lederle-less than half

our drug sales come from products more than 5 years old.--. 13627
3. $37 million invested in research in these important disease areas
with no significant commercial products to date.---

13631

4, 5. Lederle's antibacterial drugs have a high rate of obsolescence.. 13635, 13637

6. New competing products resulted from intensive research in

broad spectrum antibiotics.--

13639

7. Lederle antibiotic prices have dropped while prices of many im-

portant consumer products have risen; 1948 versus 1958. 13640

8. Lederle antibiotic prices have dropped despite rising costs of

materials and services; 1948 versus 1958.-

13641

9. Distribution of the consumer's dollar paid for Lederle drugs in

1958...

13642

10. Lederle advertising and sales promotion cost $3.51 per doctor per

month..

13645

Charts and tables by subcommittee:

11. Selected ethical drugs-Sales by, and concentration of production

of, 15 major drug companies...

13652

12. Leading antibiotics, 1959; percent of market.

13655

13. Antibiotic prices, broad versus narrow spectrum; 1951-60 (chart). 13658

14. Price history of first broad-spectrum antibiotics, price to drug-

gists, 250 milligram tablets, 16's.

13663

15. Antibiotic prices, broad versus narrow spectrum, 1951-60 (table)- 13664

16. Price history of tetracycline, price to druggists, 250 milligram

tablet, 16's..

13664

17. Identity of prices to druggists: Tetracycline, Aureomycin and

Terramycin..

13667

18. Identity of suggested resale prices to consumers: Tetracycline,

Aureomycin, and Terramycin.

13668

19. Selected producers of antibiotics: Net profits after taxes as per-

cent of sales, 1948–59.

13673

20. American Cyanamid Co., stock prices and dividends, 1949 to
August 31, 1960.

13674
21. Military Medical Supply Agency: Tetracycline hydrochloride
tablets, U.S.P., purchases from bidders, 1956–59.

13689
22. MMSA procurement of tetracylcine, all forms, November 1956
to October 1959.

13700
23. The Lederle detail man.

14203
24. American Cyanamid Co.: MMSA procurement of tetracylcine,
all forms, by year..

13715
25. Veterans' Administration report: Chloromycetin, tetracycline,
Aureomycin, Terramycin, etc.-

14209

26. “Processes Wanted," ad from Chemical and Engineering News,

May 30, 1960.

14225

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