Thursday, September 24, 2015
How Martin Shkreli Became The Internet's Most Hated Man Within 24-Hrs
Martin Shkreli, the 32-year-old founder and CEO of Turing Pharmaceuticals, drew the wrath of social media and a couple of politicians after his effort to jack up the price of a drug called Daraprim by more than 5,000%. He was aiming to raise the price to $750 per pill, up from $13.50.
Daraprim, the pill Shkreli wanted to price hike from $13.50 to $750, treats a parasitic infection called toxoplasmosis. It’s a pretty common infection, and in most people it’s not harmful. However, if you have a compromised immune system—from AIDS, cancer, or a recent organ transplant—toxo can be fatal.
After severe negative public backlash, Shkreli had a change of mind and heart.
Shkreli told NBC News and ABC News on Tuesday evening that he would back off the price hike so the drug is more affordable, but Turing still makes "a very small profit."
Here is the thing that makes me curious about the backlash against Shkreli. What he was attempting to do is something drug companies do all the time - just take a look at a breakdown of a hospital bill for proof. They jack up pill and drug prices to seemingly ridiculous levels.
The question is - "are the price hikes justifiable?"
A 2014 report from Tufts University Center for the Study of Drug Development found that the average cost of going from chemical compound to clinical trials to FDA-approved drug is $2.7 billion. Even drugs that fail early can cost companies millions. “There’s a saying, that it costs a billion to produce the first pill, and 10 cents to produce the second,” says Rachel Sachs, a fellow at the Petrie-Flom Center for Health Law Policy, Biotechnology, and Bioethics at Harvard Law School.
Shkreli's Daraprim was already developed and approved when he acquired the rights to it in August. So any development costs should have been assumed in the acquisition price.
Shkreli initially defended the price hike by saying the extra capital from the price hike would be used to improve the 62-year old drug. That's a point no could hold him to because he hadn't done it yet.
I think Shkreli's brash move portrayed him as a CEO bankrupt of any morals regarding people whose lives could very well depend on his product. As previously mentioned, drug companies and high prices are nothing new. The established companies have gotten away with it because it's done under the guise of "a company". Shkreli put a face to his skyrocketing increase - thus humanizing it - and all hell broke loose.
As wrong as squeezing the wallets of the sick and their insurers is - it does exists and will remain so until the general public takes a stance against it.