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Pharma CEOs, including AbbVie's Richard Gonzalez, testify on Capitol Hill. Photo: Win McNamee/Getty Images

Humira is the world’s most profitable drug, but it’s also a prime example of Big Pharma's business model, as Sy Mukherjee lays out well in a big Fortune story.

The big picture: "These companies became like great big record labels: reliant on talent spotters going out and finding new artists," SVB Leerink analyst Geoffrey Porges tells Fortune.

Details: AbbVie, which now sells Humira, did not invent the drug. It bought the smaller biotech that did.

  • Once it owned Humira, AbbVie protected it with a thicket of patents — roughly 136 of them, and it has aggressively sued to protect those patents. It has also raised its list prices every year and spent big on marketing.
  • And now, with Humira competition inevitably approaching, AbbVie is buying Allergan, where it will benefit from the lucrative market for Botox and other cosmetic products.

Why it matters: This is increasingly how the industry works.

  • Small biotechs patented two-thirds of the novel drugs the FDA approved last year; Big Pharma companies only developed one-quarter of them.
  • Most Big Pharma companies are expected to reduce their research and development budgets.

The bottom line, per Mukherjee: "Hundreds of millions go to marketing and legal-fortress building, while innovation and scientific discovery — ostensibly the beating heart of the biopharmaceutical industry — is often imported from the outside."

Go deeper:

Go deeper

Updated 2 hours ago - Politics & Policy

Key government agency says Biden transition can formally begin

General Services Administrator Emily Murphy. Photo: Alex Edelman/CNP/Getty Images

General Services Administrator Emily Murphy said in a letter to President-elect Joe Biden on Monday that she has determined the transition from the Trump administration can formally begin.

Why it matters: Murphy, a Trump appointee, had come under fire for delaying the so-called "ascertainment" and withholding the funds and information needed for the transition to begin while Trump's legal challenges played out.

Updated 3 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Vaccines: Key information about the effective COVID-19 vaccines — Oxford and AstraZeneca's vaccine won't just go to rich countries.
  2. Health: U.S. coronavirus hospitalizations keep breaking recordsWhy we're numb to 250,000 deaths.
  3. World: England to impose stricter regional systemU.S. hotspots far outpacing Europe's — Portugal to ban domestic travel for national holidays.
  4. Economy: The biggest pandemic labor market drags.
  5. Sports: Coronavirus precautions leave college basketball schedule in flux.

Michigan board certifies Biden's win

Poll workers count absentee ballots in Detroit, Michigan on Nov. 4. Photo: Salwan Georges/The Washington Post via Getty Images

The Michigan Board of State Canvassers certified the state's election results on Monday, making President-elect Joe Biden's win there official and granting him the state's 16 electoral votes.

Why it matters: Republican Party leaders had unsuccessfully appealed to delay the official certification, amid the Trump campaign's failed legal challenges in key swing states.

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