Imagine walking into your local supermarket and finding out that the price of peanut butter had been raised from $4.00 to $210.00, representing a 5250% increase in cost. While this might sound like a horror story from a war-torn economy in a developing country, Americans are experiencing this exact scenario with the sticker price for medications they require to stay alive. Shockingly, some drug companies are jacking up the price on lifesaving medications, leaving little question as to their motives.
Old Drugs, New Prices
A recent article in the New York Times entitled Drug Goes From $13.50 a Tablet to $750, Overnight” blows the lid off the shameless greed exhibited by major players in the pharmaceutical industry. The article’s title refers to an “overnight increase” in a treatment called Daraprim which was developed over 60 years ago and is now the standard of care to treat a fatal parasitic infection. At the heart of this price increase was the drug’s acquisition by a company called Turing Pharmaceuticals, which is run by a former hedge fund manager who has been dogged by lawsuits and accusations of financial malfeasance. With the sudden price increase, some patients’ annual cost of treatment has jumped into the hundreds of thousands of dollars.
A quick glance around the Big Pharma landscape indicates that Turing is in good company with regard to its absurd price increase. In fact, Turing’s whole game plan has been duplicated many times over, with massive price increases introduced for older drugs (some generic) that are considered critical pillars of various treatment regimes.
Consider, for example, a drug called Cycloserine, which is used to treat dangerous multidrug-resistant tuberculosis. The price for this treatment was just raised from $500 for 30 pills to $10,800. By way of explanation, the company’s general manager claimed it needed funds “to invest to make sure the supply of the drug remained reliable.”
Will congressional investigations put an end to an out-of-control industry?
This type of conduct is leading to congressional investigations of drug price increases. In one such investigation, a company acquired the heart drugs Isuprel and Nitropress and raised their prices by 525% and 212% percent respectively. The dubious explanations offered up after such conduct is exposed confirm that the pharmaceutical industry prioritizes profits over patient safety.