The New York Times recently reported on some of the loopholes pharmaceutical companies use to avoid paying U.S. taxes on their profits, even though the majority of their profits come from U.S. sales. In essence, the companies are able to shift accounted profits to overseas subsidiaries where they escape the reach of U.S. law. U.S. consumers, through higher drug costs, and U.S. taxpayers, though their subsidies for the research underlying patented drugs, are the losers here, but there is at least one proposal which may solve this problem.
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