Company Acquires Rights To Drug Used By AIDS/Cancer Patients; Immediately Raises Per Pill Price From Under $14 To $750

from the because-fuck-you,-that's-why dept

When pharmaceutical companies defend outrageously-priced medicines, they often claim these massive profit margins are there to help them recoup the money dumped into research and development. But that has nothing to do with the high prices. R&D costs are consistently lower than companies portray them. The real reason for exorbitant drug prices is a monopoly granted by patents, which lock out all competitors for years. And when the patent nears expiration, pharma companies extend their monopoly by doing questionable things — like testing high-powered, opiate-based painkillers on children — just to extend the patent protection for another few months.

None of that, however, explains this: (h/t to Techdirt reader pixelpusher220)

Turing Pharmaceuticals of New York raised the price of Daraprim from $13.50 per pill to $750 per pill last month, shortly after purchasing the rights to the drug from Impax Laboratories. Turing has exclusive rights to market Daraprim (pyrimethamine), on the market since 1953.

Daraprim fights toxoplasmosis, the second most common food-borne disease, which can easily infect people whose immune systems have been weakened by AIDS, chemotherapy or even pregnancy, according to the Centers for Disease Control.

In this case, any research and marketing costs have long since been recouped (or at least amortized). The patents behind the drug — all granted between 1951 and 1954should be dead. Conveniently for Turing (and other rights holders before it), no company is offering a generic version.

Every time the drug has changed hands (and it’s done it more than once), the price has gone up. But no other company has increased the price quite as much as Turing Pharmaceuticals has. Perhaps that’s because Turing spent a significant amount of money to acquire an exclusive marketing license, but with none of the attendant patent exclusivity.

Impax Laboratories, Inc. (NASDAQ: IPXL) today announced that it has sold its U.S. rights to the Daraprim brand to Turing Pharmaceuticals AG for approximately $55 million.

Turing, of course, realizes this price jump — which puts one month’s supply in the new vehicle range ($45-50,000) at minimum — is going to be tough on those expected to pay for it, but claims to have support in place to help absorb some of the ridiculous increase.

A Turing spokesman, Craig Rothenberg, said the company is working with hospitals and providers to get every patient covered. This includes free-of-charge options for uninsured patients and co-pay assistance programs.

This sounds like exemplary altruism in the face of a presumably unavoidable [hah] increase in price. But a closer look at what Turing is actually doing shows the company will be forcing patients to choose from all of two options:

For inpatient procurement, institutions can no longer order from their general wholesaler. Instead, they must set up an account with the Daraprim Direct program. Once enrolled, orders may be placed with the company until 6 pm Monday through Friday and will be delivered the next business weekday, because there is no weekend delivery at this time.

For outpatient procurement, patients can no longer obtain the medication from their community pharmacy. All prescriptions must be transmitted to a single dispensing pharmacy: Walgreens Specialty Pharmacy. Upon insurance verification and co-pay collection, the prescription will be mailed to the patient’s home, and most prescriptions can be mailed overnight.

This presents a problem for hospitals. Although the drug is low-use (it combats the effects of toxoplasmosis — something that can cause serious issues for those with weakened immune systems, like cancer/HIV patients), it still is needed often enough that the two access routes just aren’t enough.

My institution recently encountered a difficult scenario in which pyrimethamine was attempted to be obtained through the Walgreens Specialty Pharmacy. The patient in question was currently homeless, and therefore did not have a home or address to which the medication could be delivered. Additionally, the manufacturer did not yet have a system in place to address the situation.

This could have been extremely problematic, but fortunately, my institution is affiliated with a Walgreens Specialty Pharmacy and contracted to provide bedside delivery to patients prior to discharge. The patient was able to receive the pyrimethamine as an inpatient.

Turing, of course, defends the increased price by claiming the exorbitant profit margin will result in increased R&D. But let’s take a closer look at what its spokesman is actually saying.

Rothenberg defended Daraprim’s price, saying that the company will use the money it makes from sales to further research treatments for toxoplasmosis.

Translation: this money will be dumped into finding another variation to patent, thus locking out potential competitors and allowing Turing to continue charging whatever it wants for the medication.

They also plan to invest in marketing and education tools to make people more aware of the disease.

Translation: we will market the hell out of this new drug.

This sort of thing isn’t exclusive to Turing. It’s standard MO for all pharmaceutical companies. Rather than engage in meaningful competition, these companies are awarded lengthy monopolies on drugs and treatments by the US government. Turing is no different than Amedra — part of the holding company acquired by Turing along with the Daraprim rights. But when Amedra acquired the rights from GlaxoSmithKline, it somehow managed to keep its price hike to a couple of dollars, rather than several hundred.

This huge price jump has more to do with the man running Turing, Martin Shkreli. Shkreli doesn’t have a background in pharmaceuticals, but he does know how to run a hedge fund. And he’s used this expertise to become highly-unpopular very quickly.

Since founding Turing last year, Shkreli has taken a page from what made Retrophin a high-profile–and controversial–player among small biotech companies. Retrophin’s stated goal was ferreting out value in biopharma by acquiring assets with potential in rare and neglected diseases, a process that can mean acquiring an underused drug and jacking up its cost to take advantage of rare disease pricing.

Here’s one of the moves Shkreli made as the head of Retrophin.

In September 2014 Retrophin acquired the rights to thiola, a drug used to treat the rare disease cystinuria. It was with Shkreli as CEO that Retrophin introduced a 20-fold price increase for Thiola, despite no additional research and development costs incurred by obtaining these rights.

Turing is basically Retrophin 2.0, or more accurately, Shkreli being Shkreli. Shkreli may have still been helming Retrophin at this point, had his own company not ousted him. In August, his former company also sued him, alleging financial impropriety.

It appears that Shkreli is a bit too comfortable operating in gray areas. The market-related shadiness alleged in the lawsuit appears to be just part of Shkreli’s everyday business affairs.

In an uncommon move, Shkreli himself led the Series A financing, and Turing isn’t naming any of its other backers, calling them “preeminent institutional equity investors” and leaving it at that. In a filing with the SEC last week, Turing counted 34 individual participants in its funding round but reported raising just $62.7 million.

This reported total of the funding round didn’t match the claimed total ($90 million). Shkreli had an answer for the missing funding. And that answer was “Shut up.”

A spokesman for the company declined to explain the $27.3 million difference, and further questions about the company’s financials were met with a terse email from Shkreli asking FierceBiotech not to contact Turing again.

However, if you do feel like discussing the 5000% increase in Daraprim’s price, feel free to take your questions to Shkreli himself, who is surprisingly accessible on Twitter. Just know ahead of time that you’re too stupid to understand complicated business stuff, you don’t represent anyone worth talking to, “everyone else is doing it,” and shut up.

The unasked question has its answer: why did Turning flip the switch on a 5000% price increase? Because it can. And it’s not just the people being prescribed Daraprim that will eat the cost. It will be every customer of every health insurer that covers the rest of the cost of these prescriptions. These additional expenses will eventually result in higher health insurance premiums. And while Turing is offering to help out those with little to no insurance, these costs — whether they’re absorbed by health care institutions or the government itself — will be passed on to the general public as well.

Filed Under: , , , , , , ,
Companies: turing pharmaceuticals

Rate this comment as insightful
Rate this comment as funny
You have rated this comment as insightful
You have rated this comment as funny
Flag this comment as abusive/trolling/spam
You have flagged this comment
The first word has already been claimed
The last word has already been claimed
Insightful Lightbulb icon Funny Laughing icon Abusive/trolling/spam Flag icon Insightful badge Lightbulb icon Funny badge Laughing icon Comments icon

Comments on “Company Acquires Rights To Drug Used By AIDS/Cancer Patients; Immediately Raises Per Pill Price From Under $14 To $750”

Subscribe: RSS Leave a comment
111 Comments
That One Guy (profile) says:

When corpses are just numbers

To pharma companies, a massive number of sick people is not a tragedy, or something unfortunate, it’s an opportunity. To those twisted individuals running such companies, the more sick people around the better, and if someone can’t afford the medicine they need to survive, oh well, there’s always someone else.

When the business you’re in has a link between sickness and profits, such that the more of the previous the higher the latter, it’s hardly surprising that you’d end up with some seriously sociopaths individuals who care more about profits than lives.

That One Guy (profile) says:

Re: Re: It's their new slogan

Oh if only pharma companies were that honest…

Really, they’re telling people ‘pay up or die, and you’re going to pay dearly because you have no choice’, the least they could do is be honest about it. ‘We care more about boosting profits than saving lives’, one simple line, enough with the laughable ‘Oh we’d love to make the drugs affordable, but we just can’t you know, those commercials aren’t going to pay for themselves.’

John85851 (profile) says:

Re: When corpses are just numbers

I forget which TV show or movie had a pharm executive as a bad guy, but the point was basically this: pharm companies don’t want to cure customers (I mean “patients”) since this will end the income stream. Instead, pharm companies sell drugs to counter the side effects and get people legally hooked.

And not to sound like a conspiracy theorist, but there’s probably a reason why pharm companies haven’t found a cure for cancer or AIDS.

Now, granted, the show was a fictional drama, but it seems a little too accurate.

Mason Wheeler (profile) says:

Re: Re: When corpses are just numbers

You might sound like a conspiracy theorist if the companies weren’t openly bragging about this to their shareholders. When you find a drug that turns cancer from a death sentence into a chronic condition, where you just take a pill every day (for the rest of your life!) and it keeps the cancer in check, that’s the holy grail of for-profit pharmaceutical research.

Anonymous Coward says:

Re: When corpses are just numbers

Generics companies are our saviour in Canada, goddamn. But still, they don’t invent anything. We have a massive need for new antibiotics but that means tons of research for years to cure infections that last 5-10 days max. Even the CDC is extremely concerned about this. Let’s hope the assholes use the profits to some sort of really needed project like that (yeah right).

Anonymous Coward says:

Re: Re: Re: Re:

They have the right to market this particular brand of the drug, which happens to be the ONLY brand of the drug.

Nothing is preventing generics from stepping in, except that there’s not enough of a market to make it worthwhile. The insanely high price WOULD be a reason, except they know that the price will plummet once there’s competition.

Anonymous Coward says:

“But no other company has increased the price quite as much as Turing Pharmaceuticals has.”

Tim is actually wrong on this part. I seem to recall that a few years ago, another drug company increased prices on a prescription drug by more than 5,000%, and it was something that was even covered by Techdirt. I don’t remember the name of the drug, but it was covered here.

Anonymous Coward says:

Re: Re:

not quite in the same exact topic, but the same vein:

http://timesofindia.indiatimes.com/india/New-Hepatitis-C-drug-99-cheaper-in-India/articleshow/39719323.cms

from the article: The blockbuster hepatitis C drug will cost about $900 (around Rs 54,000) in India for a 12-week course of treatment. That would be a fraction of the $84,000 (over Rs 50 lakh) price tag for the same treatment in US.

Anonymous Coward says:

Re: Re:

The drug’s name was Makena (hydroxyprogesterone caproate) and it happened in 2011. I actually went bonkers when I first read it.

Here, have a go at the whole saga:
https://www.techdirt.com/blog/?tag=makena

That’s what a mix of patents & monopoly regulation will do.

I just DDG’d Martin Shkreli and this is in the top 3 links:
http://www.citizensforethics.org/legal-filings/entry/us-attorney-investigate-short-seller-martin-shkreli

We REALLY NEED a f’ing body of public domain/GPL or otherwise Open Source drugs dammit…

Anonymous Coward says:

Re: Re: Hopefully

The question becomes do they have a monopoly because their specific brand is the only FDA approved brand? Have other companies attempted to get FDA approval of other generic brands? Has the FDA denied them? If so is the FDA (or are FDA employees) involved in back door dealings (ie: a conspiracy to scam the public)?

Dan (profile) says:

Re: Re: Why no generics?

That’s kind of what I was thinking/wondering. If that’s the case, the problem should self-correct fairly quickly, I’d think.

Tim tries to paint this as an issue with drug patents, but I can’t see how they’re relevant to this case. The patents, he says, are 60+ years old, and patents at that time didn’t last more than 17 years from issue. It would thus follow that this drug isn’t under patent any more (and hasn’t been for a good long time). Thus, whatever the problem is here, it isn’t likely to be patents.

In most industries, this would appear to be an antitrust violation. Having a monopoly, by itself, isn’t illegal (after all, the government can’t force another company to compete with you if it doesn’t want to), but taking undue advantage of that monopoly is. If (as it appears) nothing has changed but a desire to jack up prices, that would probably qualify. Given the regulations on pharmaceuticals, though, I’m not sure if or how the traditional antitrust rules apply to them.

Anonymous Coward says:

Re: Re: Re: Why no generics?

It’s not a patent issue.

When patents become a huge issue, not all that long ago, more than 50% of all prescriptions were written for patented drugs. Now only about 10% of all prescriptions are written for patented drugs, a number which has continued to drop and appears to be headed toward 5%. So the problem is now becoming cost effectiveness of production. Some drugs have such low annual usage that only one company is producing certain drugs, a very effective monopoly, leading to abuses far worse than were ever even contemplated by companies holding patents.

I am amused by the irony that drugs prices can escalate beyond all sanity in the absence of patents, especially when so many people kept pushing for the abolishment of patents.

Anonymous Coward says:

Re: Re: Re:4 Why no generics?

On a 60-year-old drug? I think not. Simply stated, as the attached article indicates, the problem is few companies producing certain generic drugs.

Still hilarious. So many people thought the abolition of patents would reduce all drug prices. Wrong.

http://www.msn.com/en-us/money/markets/fury-over-drug-price-spikes-rising-but-increases-arent-new/ar-AAeH6G5?li=AA4Zjn

Anonymous Coward says:

Re: Re: Re: Why no generics?

“The problem is low demand. Very few people take the drug,” in the US… Add a few preservatives (they do that anyway) and export them to other countries.

I’m pretty sure that selling a 20$ pill for 5$ in india beats having unsold inventory.

As for the rest maybe, just maybe it’s about f’ing time government did its job properly.

Add incentives for companies who sell reasonably priced drugs to poor countries for example.

But wait, that too is … you guessed it … everyone’s favorite word … SOCIALISM!!! So of course it will never happen.

After all it’s not like those countries are (thanks to, in no small part, the USA) effectively banned by various trade agreements from producing their own cheaper generics.

jraama says:

Re: Why no generics?

I would not count on generic competition anytime soon, and possible not at all. The number of patients is low so volume would also be low.

To put a generic on the market, you still need to make demo batches and conduct some amount of testing on those batches. And you still need to file an approval application with the FDA, wait for them to complete their review, and then have your site inspected. These things are more or less a fixed cost, and they take a few years to complete.

By the time a new entrant is in the market and ready to sell a generic, Turing will have recouped their costs and will be able to complete on price. So there is very little incentive for another company to get in the market. It would be great for the patient population, but ultimately a loss for the generic maker.

Thrudd (profile) says:

a totally anti American solution

All pharmaceutical patents go to the state since the research was funded and overcharged to the taxpayer in the first place.

Have the drug companies compete on price quality and support.

That would kill a lot of the big pharmaceutical companies because they have outsourced all their manufacturing and laboratory support services thanks to FDA loosening regulations regarding subcontracting by big American pharmaceutical companies in the past decade or so.

Anonymous Coward says:

This isn’t greed on the part of the pharmaceutical companies. They are simply trying to make their money back. What everyone is forgetting is that the people don’t pay these drug prices, its the health insurance policies.

It’s no different than buying a comic book for $5 then turning around and reselling it for $50 when the value increases.

Anonymous Coward says:

Re: Re:

This isn’t greed on the part of the pharmaceutical companies.

Yes it is. This company, anyway.

They are simply trying to make their money back.

The company jacking up the price is not the one who developed the drug – which was developed over 60 years ago and has long since paid for its cost of development.

What everyone is forgetting is that the people don’t pay these drug prices, its the health insurance policies.

Which means that we ALL pay for it, via increased premiums.

It’s no different than buying a comic book for $5 then turning around and reselling it for $50 when the value increases.

When someone says they’ll die if they don’t get a copy of Superman #1, they aren’t speaking literally.

Josh in CharlotteNC (profile) says:

Re: Re:

“They are simply trying to make their money back.”

This drug was on the market 60 years ago. They already made their money back, many times over.

Tauring isn’t a pharmaceutical company (at least not in this instance). It’s an acquisition and licensing company. It basically bought the trademark name the drug is sold under, and only in the US.

Next development in this story: people will start importing this drug from other countries where Tauring doesn’t have the monopoly, and Tauring will sic ICE or some other government agency for-hire on them.

Whatever (profile) says:

A little background

A little background into the subject might help.

The drug in question Daraprim has never had more than about 15k total prescriptions in the US. Assuming a 1 pill per day regime, it means about 5 million pills a year. User count before the price increase was sitting at about 8000, according to figures I could find online, or about 2 million pills.

It is also a drug that is slightly harder to make, store, and distribute as it is light and air sensitive and can quickly degrade.

It is in fact a brand name generic drug, one that is sufficiently complex to make that few seem to have an interest, especially considering the size of the marketplace.

The price increase does potentially offer up a chance for another company to come into the marketplace. However, short term that is very unlikely, it can take a year or more to get FDA approval to produce even a generic drug, especially one of this nature. Someone will likely try to move into the marketplace, but as this is a small market generic, it’s likely they will still charges in the hundreds per pill to make it worth getting into the game.

Dan (profile) says:

Re: A little background

User count before the price increase was sitting at about 8000, according to figures I could find online, or about 2 million pills.

…which means, assuming that prescription volume doesn’t change much (and assuming the new price actually sticks), that a $55M investment is going to yield a return of $1.5B/year. That’s $1.5B of revenue, not profit, but supposing they were barely breaking even at $14/pill (which they weren’t; they were making a profit, otherwise they wouldn’t have been selling it), that works out to $30M/year in production costs. Negligible.

Michael (profile) says:

I am not sure why everyone is up in arms about this price increase. Sure $750 per pill is crazy, but the real travesty is that nobody was complaining at $14 per pill.

A simple calculation of the stated numbers has someone needing 2-3 pills per day putting the old price at about $1000 per MONTH for a drug that I’m sure has a marginal cost to manufacture somewhere less than a penny.

Craig Welch (profile) says:

Re: Marginal price

What is the relevance of the marginal manufacturing cost?

Far be it from me to defend price-gouging drug manufacturers, but there is far more than that one cost that has to be recovered. Even though they lie about development costs, there are development costs to be recouped, as well as the cost of marketing, insurance, legals, and many more.

It’s simplistic in the extreme to say that a drug should only cost a few pennies because that’s all it costs to make it.

Manabi (profile) says:

Re: Re: Marginal price

The medicine cost only $1 a pill several years ago (article isn’t clear on how long ago that was), so it’s pretty obvious the cost to manufacture here isn’t very high. Certainly nowhere near $13 a pill, and not even in the same ballpark as $750 a pill. I won’t claim every generic should cost pennies per pill, but this generic shouldn’t be more than $1-$2 a pill.

This company also has zero development costs to recoup, the medicine has been around since 1953. The guy says he’s doing this to fund R&D into a new drug for the disease, but there’s actually no demand or need for one. So that’s probably a lie to try to justify the insane price gouging.

Anonymous Coward says:

Re: Re:

“..the real travesty is that nobody was complaining at $14 per pill.”

Yep:

“Only a few years ago, Daraprim cost only about $1 a tablet, but the drug’s price rose sharply after CorePharma acquired it.”

http://www.independent.co.uk/news/world/americas/hedge-funder-buys-rights-to-drug-used-by-aids-patients-and-raises-price-from-1350-to-750-per-pill-10511690.html

John85851 (profile) says:

Low-cost option

I think more attention needs to be given to the “low cost” option. If the company is willing to charge $750 per pill, they’re not going to give away free samples out of the goodness of their heart. Someone, somewhere, will be paying for this- if it’s not the patient, it’ll be the health insurance company… who will then pass this cost on to *all* their patients.

Remember that insurance companies are in business to make money also, and their options for covering expenses like this are more limited since they can’t legally drop people for having an expensive sickness.

Anonymous Coward says:

Re: Re: Re: a totally anti American solution

If we lived in a society that you couldn’t patent already existing technology, I would agree. While technically I know that you aren’t supposed to be able to get a patent in prior technology, it takes a lot of money and lawyers to fight bad patents. The best option is to patent it and then open the patent up so that it could be used by others.

Anonymous Coward says:

Re: Re: a totally anti American solution

>> All pharmaceutical patents go to the state since …
>> Socialist much? … Reduce or eliminate patents and problem is solved.
> … government funded research should mean a government controlled patent.

You … DO realize, don’t you, that patents are not at issue in this case? It’s a captive market for a scarce commodity.

This case is more like the market for VT100-compatible terminals. The only reason you’d use them is if a) it were critical to your need, and b) there wasn’t an adequate alternative. Say, missile launch controls….

And even then, you’d look for alternatives because the cost is unreasonably high. Modern display software. Alternative drugs to treat toxoplasmosis.

And as the article points out, those solutions have their own problems: the original wasn’t patent controlled, but the replacement might be.

Uriel-238 (profile) says:

Re: Re: Why is more government not the solution.

I mean I get it. There’s a lot of crap and corruption in our government…

…but when the choice is government meat inspection or no meat inspection, we choose government meat inspection.

…When the choice is a government highway system or no highway system, we choose a government highway system.

Every market needs to be regulated or it’s going to pull bullshit exactly like Turing is doing, and that’s why we need government in the first place, to stop that stuff, or at least slow it down.

And yes, we have problems when government gets to big, but I think that’s a problem to be solved.

Because having less government means having less cool stuff. And it means leaving the jackasses to prey on the weak unchecked.

So yeah. More government, and more socialism isn’t unamerican, it’s progress. It’s recognizing that unregulated capitalism has led us to $750 pills for HIV patients.

Feel free to work out another solution if you don’t want further regulations, but the alternative to doing something real and immediate is $750 pills for HIV patients.

…oh and Shkreli splashing around in his riches like Scrooge McDuck.

Anonymous Coward says:

Re: Re: Re: Why is more government not the solution.

They don’t care… THEY’RE NOT HIV PATIENTS…
Don’t you know that HIV is a GAY disease, well either that or they had sex out of wedlock.

BTW that was sarcasm.

I have absolutely nothing against consensual sex between adults.

Then again I also believe that as a society we should help prop each other throughout the mistakes of life.

Surely a McJob isn’t worth the same amount as a top lawyer, but that person shouldn’t have to starve or otherwise die of EASILY (and CHEAPLY) CURABLE diseases.

But again, any kind of such program will be seen by many US people as… the dreaded ghost of socialism.

BTW that was also sarcasm (not really).

Anonymous Coward says:

Re: a totally anti American solution

Playing the Socialist card is ridiculous.

Try some rational thought:
What is the price for society and the sick to keep big pharma in profits?
Why spend taxes to feed a corporate welfare addiction?

One more thing to consider:
One day you or someone you love may be in that hospital bed having the doctor tell you they’d like to help but unfortunately the insurance won’t cover the cost…

Corey says:

perfect example

of why TPP and TTIP must not pass the fast track process.

those two trade agreements would force this, on many other countries besides the USA. Like India where their patent law is more realistic. In India this kind of patent exploitation is not allowed. TPP would force India to adopt US style patent laws.

especially in country’s that simply outright can not afford that kind of jump in prices.

I consider this a “crime against humanity” to exploit the sick in this manor.

I have to wonder if this particular company is a front for a group focused on reducing the population and eliminating the “undesirables”

Also, that claim of profits for research… Don’t they already get grants and tax credits from organizations and governments to fund said research? meaning that they themselves are not actually footing the bill?

forget the lynching. maybe we need to roundup the leaders of this company and inject them with the HIV virus and require them to pay the same rates or more based on what kind of wealth they have stashed away. That way they struggle just like the average person does. Then see if they have a change of heart about how much they charge.

Also the price set is NOT suppose to go for other research it is suppose to be bound to the product purchased (service paid for service rendered). Not (pay for services not rendered)

I think they need to re-implement the 300% profit cap again that they had in the 80’s for any goods or services charged.

I think they need to modify patent law and make it so patents can not be transferred. it can only expire.

purpose of patent was to allow original creator a short term monopoly, so they could be rewarded for the effort of bring a new service or product to society. Before others were allowed to tweek or modify the original design.

That Anonymous Coward (profile) says:

The truly sick thing is there are many drugs out there that have “little” call for them, although the people who need them will die without them.
There are hundreds of odd little diseases that no one is funding research into because it can’t be profitable, letting people die.

We keep expecting these corporations to suddenly have a heart and do the right thing, how are we still this delusional?
We need to offer prize money for treatments being developed.
We need to then have a public benefit network of producers who create the pills and are allowed a tidy profit.
Some will balk at that idea, but what if finding the treatment/cure for a disease that only affects a few thousand people globally leads to something that can benefit even more people?
There is hardly any real research done in these areas, it is all focused on the next hot thing to keep the big bucks flowing in from treatments for ED, Diabetes, Heart Disease, and other problems we see advertised daily in the US.
We can’t force them to work for the public good, but perhaps we should put our outrage to work on a real solution. I’d rather pray for this system to happen than for a CEO to suddenly get a heart and decide that benefiting the world matters more than his gold plated ass warmer.

This asshat is only doing what the system allows, and his money means he’ll keep being able to do it because he can just buy the influence to protect his interests for a fairly low price (history of campaign “contributions” vs the billions that influence rakes in goes here).

voiceofReason (profile) says:

A second look

Although this seems on its face to be outrageous, what about all the drugs whose costs have NOT been recouped? Do you assume all drugs make outrageous profits, or is a company supposed to price a drug without considering all other costs the company bears, such as for R&D for the much larger majority of drugs that failed along the path to approval, or even after approval?

Anonymous Coward says:

Re: Re: A second look

I don’t think so.

First, patents are not the issue here.

Second, the number of prescriptions being written for patented drugs continues to decline. I predicted a decade and a half ago that the number of prescriptions for patented drugs would stabilize at around 8%. It appears that I am off. The number of prescriptions for patented drugs looks like it is going to decline to about 4-5%, and it may drop even further. The bottom line is that with the minimal number of prescriptions for patented drugs, throwing pharm companies into a “tax-funded program” is likely to be BENEFIT pharm companies rather than solve a problem.

Let’s not create another government funded debacle (e.g., TSA and Obamacare).

Uriel-238 (profile) says:

Re: Re: Re: Government funded debacles

Obamacare is still toddling but it’s hardly a debacle. Unless you’re talking about all the shenanigans by our representatives to shut it down, including holding our entire nation hostage (and costing taxpayers billions). That was a debacle.

Obamacare may lead to a fully socialized medical program, which, given recent pharmaceutical news, may be a good thing.

The TSA on the other hand was a tiger repellent rock to begin with. Now it’s a TRR that cannot be disbanded.

Anonymous Coward says:

Re: Re: Re:2 Government funded debacles

I consider Obamacare a debacle because:

(1) Its administrative costs are 20%. Absurd.

(2) For the benefit of the roughly 15 million people covered by Obamacare, which is less than 5% of the United States, health care costs have increased, choices have decreased, and thousands of companies are planning on cutting insurance benefits to avoid the 40% tax penalty that insurance plans above a certain dollar limit will face. So, tens of millions of people suffer for the benefit of 15 million people.

I can’t afford Obamacare, but I am getting taxed for not being able to afford it. I so love the way government works.

Anonymous Coward says:

Re: Re: Re:4 Government funded debacles

Sigh…Of course, essentially all this information has been widely reported, unless you have been living under a rock. However, here are some sources:

Re overhead…

SORRY! I was wrong about 20%. Apparently it was 45%, and is expected to EVENTUALLY drop to 20%. My bad.

http://thehill.com/policy/healthcare/243188-overhead-costs-exploding-under-obamacare

Here is a great article describing that most of the benefit of Obamacare is to low income people, and as income levels rise, participation falls off dramatically, and yet all people not participating are taxed for not participating.

http://www.cnbc.com/2015/03/25/low-income-people-loved-obamacare-but-the-rest-of-us.html

As for costs under Obamacare:

http://www.nytimes.com/2015/07/04/us/health-insurance-companies-seek-big-rate-increases-for-2016.html?_r=0

It ain’t getting any better:

http://humanevents.com/2015/08/26/obesity-and-health-care-costs-continue-to-rise-under-obamacare/

http://www.fool.com/investing/high-growth/2015/08/30/get-ready-because-big-changes-are-coming-to-obamac.aspx

The so-called Cadillac tax of 40%:

http://www.washingtontimes.com/news/2015/aug/25/obamacare-cadillac-tax-to-hit-1-in-4-employers-tha/?page=all

Wow, since Obamacare passed, the increase in health care costs compared to CPI have increased hugely!

http://www.forbes.com/sites/mikepatton/2015/06/29/u-s-health-care-costs-rise-faster-than-inflation/

I probably have not provided sources for every single item, but you have sources for most. Perhaps I should ask, what SPECIFIC item would you like sourced?

Anonymous Coward says:

Re: Re: Update

Different drug, same context.

Basically The Chao Center, a nonprofit group affiliated with Purdue University sold the rights to cycloserine to Rodelis Therapeutics, because obviously “in trying to support the product, the manufacturer […] was losing significant
money”

I’m not an idiot, I KNOW that drugs cost money to make, and BIG MONEY at that, BUT WE REALLY need a middle-ground solution here.
We don’t ask 15000$ for a life vest or 30000$ for seat-belts in cars just because they happen to save lives.

The same should go for drugs, ESPECIALLY out-of-patent generic drugs.

But then again over half of the US would consider any such kind of funding socialism so it would most likely never fly…

Sources:
http://static1.squarespace.com/static/549f011de4b0bf1b6a9945dc/t/5600941ae4b02ea8d860afbb/1442878490651/Update+Regarding+Cycloserine.pdf
from here:
http://www.newser.com/story/213219/massive-drug-price-increase-rolled-back.html

Bri (profile) says:

Seeing the future

https://www.reddit.com/r/news/comments/2g43kw/a_generic_drug_company_retrophin_buys_up_the/ckg20en

Was just reading more up on reddit, and user GarryMcMahon pointed out that about a year ago Shkreli was on reddit talking about this issue. Some people used the remindme bot to remind them a year later about it, predicting the storm this turned into. Turns out they were a 10 days off in their predictions.

TriSongz (user link) says:

We need to open-source pharma patents

While this happening is indeed quite tragic for the millions of people that it will effect, the real case in point is that there’s nothing that prevents a scenario like this from happening again.

I write about it a bit more extensively at the link below, but we need to address this issue in a way that cannot rely on government intervention because the chances of it happening are slim to none. Rather, we need to find a way to open-source these pharma patents to allow many manufacturers to compete on the same level, and while they’re still able to make profits, the competition with supply and demand would drive the cost of these drugs way down, benefiting ultimately everyone.

http://www.pixelrocketapps.com/lets-open-source-drug-patents-to-avoid-pharma-trolls/

NFW says:

We need to thank Shkreli

Before this story broke, how many people knew the practice of buying rights to low-use, low-priced drugs then jacking up prices was so common? Perhaps now that we know – AND AS LONG AS WE HIGHLIGHT THAT THIS AFFECTS EVERYBODY’S INSURANCE PREMIUMS – Congress, etc. will impose limitations.

Yea, Right . . . I’m not counting on that either.

NFW says:

We need to thank Shkreli

Before this story broke, how many people knew the practice of buying rights to low-use, low-priced drugs then jacking up prices was so common? Perhaps now that we know – AND AS LONG AS WE HIGHLIGHT THAT THIS AFFECTS EVERYBODY’S INSURANCE PREMIUMS – Congress, etc. will impose limitations.

1) Yea, Right . . . I’m not counting on that either.
2) It pains me to suggest that the Federal Government should control a company’s profit margins, but douches like Shkerli, and his excesses must be reined in.

Add Your Comment

Your email address will not be published.

Have a Techdirt Account? Sign in now. Want one? Register here

Comment Options:

Make this the or (get credits or sign in to see balance) what's this?

What's this?

Techdirt community members with Techdirt Credits can spotlight a comment as either the "First Word" or "Last Word" on a particular comment thread. Credits can be purchased at the Techdirt Insider Shop »

Follow Techdirt

Techdirt Daily Newsletter

Techdirt Deals
Techdirt Insider Discord
The latest chatter on the Techdirt Insider Discord channel...
Loading...