Former hedge funder hikes price on drug for HIV-related toxoplasmosis
Cost of Daraprim increased from $13.50 to $750 per pill after being acquired by Turing Pharmaceuticals
Depending on your personal views or political leanings, Martin Shkreli is either a defender of capitalism who will use his money to benefit greater research to cure a life-threatening parasitic infection or a heartless price-gouger who will make it cost-prohibitive for hospitals to use the drug that can cure that infection.
The New York Times on Monday reported on Turing Pharmaceuticals’ acquisition of the drug Daraprim in August of this year. Daraprim, a 62-year-old drug, is used treat toxoplasmosis, an infection that affects people with compromised immune systems, such as those suffering from HIV or certain types of cancers. Daraprim is also used to treat malaria.
Following its acquisition by Turing, Daraprim’s price skyrocketed more than 5,000 percent, going from $13.50 per tablet to $750 per tablet, bringing the annual cost from treatment for some patients to hundreds of thousands of dollars. The Times notes that Turing’s increase of the price of Daraprim is not an isolated incident: in recent years, prices have been increased on drugs that treat cancer, hepatitis C, tuberculosis and high cholesterol, as well as on generic drugs, sparking concern among members of the medical community.
Martin Shkreli, the founder and chief executive of Turing, has given a number of interviews defending the price increase. Turing has argued that the increase is necessary to help keep Turing in business, and has vowed to use the money to develop better treatments for toxoplasmosis that have fewer toxic side effects.
“This isn’t the greedy drug company trying to gouge patients, it is us trying to stay in business,” Shkreli said, noting that the average course of Daraprim is taken for less than a year. He argues that the price increase has now brought the drug into line with prices for medications that treat other rare diseases.
But some medical experts have questioned the price increase, noting that it will make it cost-prohibitive for hospitals to keep on hand. As a result, doctors may be forced to either delay treatment or use alternative therapies that may not be as effective in treating toxoplasmosis.
The Infectious Diseases Society of America and the HIV Medicine Association sent a joint letter to Turing earlier this month calling the price increase for Daraprim “unjustifiable for the medically vulnerable patient population” and “unsustainable for the health care system.”
In an interview on ‘Bloomberg Markets” yesterday, Shkreli argued that previous owners of Daraprim were basically “giving away” the drug, as a six-week course of treatment (about 100 pills in total, taken twice a day) only cost a little more than $1,000. Shkreli said that Daraprim is still “underpriced” compared to other rare disease drugs, even after the increase. Primarily, Shkreli attributes the need to increase the price to the costs associated not only with production — he admits that the drug can be produced for $1 — but distribution, manufacturing and FDA compliance costs.
“This drug was doing $5 million in revenue,” Shkreli says. “I don’t think you could find a drug company on this planet that could make money on $5 million in revenue. Those costs are much higher than that.”
Shkreli also argues that Turing has a co-pay assistance program for patients, and has expanded the company’s free drug program, noting that his company will never deny someone treatment — even if there is a dispute with the patient’s insurance company — based on their inability to pay. But what separates Turing apart from other companies, Shkreli claims, is his commitment to research and development to develop a better alternative to Daraprim.
“We can make a better drug for this disease,” Shkreli says. “Remember: no one’s cared about this illness, for a long time, from the pharmaceutical perspective, if ever. And I think that’s a terrible thing if you’re suffering from toxoplasmosis. Now you have a powerful ally in our company that is willing to make drugs for you, that is willing to invest that money. And to do that, we all know drug development is very expensive. They estimate a new drug can cost up to a billion dollars to develop. It’s only fair that we make a profit, and we take that money and put it back in the patients’ hands.
“I don’t advocate for companies that raise price and don’t do any research. And, by the way, there are dozens of those,” Shkreli continues. “So the spotlight on me is an interesting thing.”
Chad Griffin, the president of the Human Rights Campaign, issued an open letter to Shkreli decrying the price hike and vowing to hold him and his company accountable for their actions.
“Your greed in raising the single-pill price from less than $15 to more than $750 is unconscionable,” Griffin writes in the letter. “It immediately puts at risk scores of medically vulnerable people, including those living with HIV, and women who are pregnant. Medical organizations have estimated that this predatory move could increase the average cost per year for an adult patient reliant on the drug to more than $630,000. … Instead of taking advantage of our system to turn a profit, I call on you to restore fair pricing for Daraprim.”
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