
Drug Goes from $13.50 a Tablet to $750, Overnight - m_haggar
http://www.nytimes.com/2015/09/21/business/a-huge-overnight-increase-in-a-drugs-price-raises-protests.html?hp&action=click&pgtype=Homepage&module=second-column-region&region=top-news&WT.nav=top-news&_r=0
======
bedhead
I am a fund manager and I have followed Martin Shkreli since his prior
company, Retrophin, went public about two years ago. Simply put, Martin is a
sociopathic criminal with a well-established, and consistent track record of
deceit, recklessness, failure, and just plain old stupidity. But he is also
hyper-aggressive. He is currently living in Switzerland, and it's my
understanding that he fled the country in order to avoid prosecution and asset
forfeiture.

Anyway, Martin is running the same playbook at Turing that he did at
Retrophin, which is to find some old orphan drug and raise the price by orders
of magnitude. It's believed insurers won't have a choice but to pay since
there are no competitors. If you want to see how this has worked out in the
past, feel free to google "KV Pharmaceuticals Makena" which did something
similar a few years ago, only to have it bankrupt the company (which would be
an outcome completely consistent with Martin's history and tactics).

For a fun read, check out the lawsuit filed against him by Retrophin. In all
my years of investing, he is one of the most unique scumbags I've ever come
across.

[http://www.sec.gov/Archives/edgar/data/1438533/0001193125152...](http://www.sec.gov/Archives/edgar/data/1438533/000119312515292581/d19898dex991.htm)

~~~
cmiles74
It seems to me that the overall result would be other companies start
manufacturing the generic and sell the drug for maybe 20% less than Martin and
over time the price drops back down towards where it once started. In the
meantime, this company either goes bankrupt or is sold off.

Or the government passes a law capping how much you can raise the price of a
generic drug over so many years.

~~~
bedhead
That's the loophole though, the quantities are so small that realistically, no
pharmaceutical company has the incentive to make their version of the drug,
even at $750 per dose. There are still costs to making a drug that's off-
patent, and sometimes the number of patients being treated is only in the
double digits. Additionally, a competing drug released at say, $500 per dose
would still be considered predatory anyway. This is really the backwater of
pharma.

The case of KV Pharmaceuticals that I cited was a little different since
compounding labs had already been making the drug Makena. In that case, the
FDA actually sent these labs a letter essentially saying, "Go ahead and keep
making the drug even though KV now has a patent for it. We are choosing to not
enforce their patent because their price increase was bs."

Maybe the government can prove its worth and get off its ass and quickly
figure out how to close this loophole, then go after Martin and others like
him.

~~~
danmaz74
They should just allow importing drugs from other markets that have good
enough quality standards - like the EU or Canada I guess. Problem solved.

~~~
ssmoot
But who provides the quality standards oversight? The drug is apparently
produced in India. What if pills were shipped to the US and it was found after
the fact that many batches contained unacceptable levels of iron? Who to
blame?

I'm sure Canada has decent oversight, but who wants to say that the solution
is no direct US agency oversight, and that we want a "Pharmaceuticals-NAFTA"?
It seems funding oversight with a "homeland" agency is one issue you could get
bipartisan support on.

While sure, I doubt many have a problem with medical tourism, I'm not sure
bringing drugs across the border intended for distribution without FDA
approval is the answer.

On the other hand maybe countries working together at the agency level to
ensure their oversight measures are in compliance with some agreed upon
standard is a sane way to move forward. But then who maintains the list of
approved drugs? Is that power given to some international body? Or does the
FDA still have to approve drugs for distribution and only alternatives are
brought in? And then what about drugs that are patented in the US (like this
one), but freely available in other markets from other manufacturers?

It seems a worthy enough goal in general, but I don't think a fully
libertarian approach to the problem comes close to being the right answer
either.

~~~
robotresearcher
We import all kinds of stuff from all over the world and enforce quality
standards very well. The current situation is more like protectionism than
consumer protection in many cases.

~~~
Kalium
While broadly true, this is an area where counterfeiting is easier, detection
is difficult, enforcement is harder, and legitimate manufacturing is often
expensive.

In other words, exactly the conditions to encourage all kinds of abuses.

~~~
robotresearcher
That is all true but we don't have to buy from shady producers. Canadian and
European producers supply their own very safe and mature markets. Buy the
stuff that the UK NHS buys and at the same prices - their scale gets them good
deals (with notable exceptions). This can't be worse than the current deal.

~~~
Kalium
This might surprise you, but conditions that encourage abuse also encourage
people to find ways to avoid having their abuse detected.

Yeah, it can be worse than the current deal. Just look at the problems China
has with counterfeit food.

~~~
robotresearcher
This whole thread is about a horrible abuse present in the current system. The
potential for abuse in an alternate system does not disqualify it. There is no
perfect system and bad actors are everywhere. However, I don't see terrible
endemic problems in the UK, Canada or the Eurozone from importing drugs. I'm
sure they exist sometimes. But in the entire rest of the G7 drug costs are
less and their outcomes no worse than the US.

~~~
Kalium
If the problem is abuse, that a proposed successor system may not be better is
a major source of concern.

~~~
shawn-furyan
If the situation is as I read it:

\- Importing drugs from countries with reliable drug regulatory infrastructure
would have substantial benefits, including a check on cost (sorely needed),
and improved availability of less profitable drugs

\- Other similar countries are doing this without seeing measurable negative
health outcomes

then getting hung up on this 'major concern' that seems to have been rendered
moot elsewhere makes most people worse off. Mentioning the existence of
potential (and unlikely?[1]) downsides is not an adequate cost-benefit
analysis.

[1] not that it's unlikely that there will be people who try to take advantage
of the system, but it seems unlikely that given appropriate regulatory care,
the downsides will be unmanageable to the extent that they cause the change to
allow drug imports to have an overall negative impact.

[edited for clarity, including the addition of the footnote]

------
jakobegger
It should be pretty obvious by now that the pharma sector is completely out of
control. Again and again I read about the rising cost of healthcare, how we
can't afford to support an aging society, and now even "solved" problems are
used to squeeze even more profits from those who can afford the least.

And I'm not talking about the US, this is a world wide problem. Instead of
making international treaties that make enforcing medical patents even easier,
we should be talking about making the medicines we have more accessible. I
don't want to live in a world were only a fortunate elite has access to modern
treatments, but it looks like that's the way we're going.

~~~
mtgx
Yet people are still quick to say "...but what about Big Pharma?" when there's
a discussion about abolishing patents.

I don't know if patents should be abolished completely, but if there's a
discussion about a serious patent reform, we should stop considering
pharmaceuticals as some kind of exception, and apply the new reform equally to
everyone, instead of allowing exceptions for Big Pharma, or worse, watering
down reforms to protect Big Pharma.

~~~
mvanvoorden
Exactly.

I don't understand why everybody's so afraid that without patents no medicine
would be made anymore. On the contrary, it would force companies to work
together and share the R&D, and would prevent the current inefficiency of
multiple companies inventing the same wheel, doing the same studies, just
because they all want to invent this medicine first.

Even better: with all the money that would be saved from not having all the
bureaucracy around patents, governments could even set up their own research
facilities and share all their findings with the public, making affordable and
better medicine available for all mankind.

~~~
Bluestrike2
That's a bit of a fantasy, isn't it? Pharma companies don't re-invent the same
wheel: even in cases where they're pursuing similar avenues of research, the
drugs being developed share sometimes significant differences (and in many
cases, even insignificant differences can later be found to be more
significant than first believed). Even if companies were somehow able to
collaborate without any problem, the end result would be a decrease in the
number of medications brought to market. Instead of multiple therapies that
doctors can use to tailor to their individual patients, they'll get one that
works for the majority of cases and woe be to anyone who falls outside the
bell curve. The developing crisis with antibiotic-resistant strains is a
perfect example of the sort of problems that arise from such short-
sightedness.

But that's a scenario based on your idea being feasible. The far more likely
scenario is an even more brutal and unethical market, where companies use
controlled distribution (such as with Daraprim) to prevent generics from being
tested, and thus, being brought to market. Why? Because without patents, even
that limited initial window for drug companies to earn back R&D costs--along
with supporting the sunk R&D costs wrapped up in the larger number of drugs
the fail to bring to market--exists only so long as the manufacturer is able
to use whatever force is available to it it to stop generics from being
produced. Far from cooperating with one another, pharmaceutical companies
would have every additional incentive to stab each other in the back. Instead
of skirmishes like you have now, you'd have a war to the knife.

It's easy to look at problems with the current patent system and think that
they'd all magically be fixed by getting rid of them. But unintended
consequences are still consequences.

~~~
mvanvoorden
Every way of dealing with something has its flaws, the point is to fix them.
The patent system is flawed in its foundation, i.e. claiming a discovery for
yourself and keeping this technology away from the rest of humanity.

For the rest, I wouldn't know why there wouldn't be multiple medicines. Labs
would still come up with multiple compounds that have more or less the same
result, and if not, research would continue for the people who fall outside
the bell curve of the other medicine.

The whole difference would be that instead of competition, there is
cooperation, and the aim is not to make money or profit, but to help humanity.
This is not unrealistic, it's basically what we (at least in NL) learn in
primary school: "Two know more than one", "Many hands make light work", etc.
It's only that the schools after that tell us to forget it all and teach us
how we need to compete each other and especially to keep everything for
ourselves and never do anything without expecting something in return.

[quote]where companies use controlled distribution (such as with Daraprim) to
prevent generics from being tested, and thus, being brought to market.
[/quote]

This wouldn't happen, as the resulting medicine IS the generic.

~~~
Kalium
> For the rest, I wouldn't know why there wouldn't be multiple medicines. Labs
> would still come up with multiple compounds that have more or less the same
> result, and if not, research would continue for the people who fall outside
> the bell curve of the other medicine.

The issue is that this process happens right now because of independent
development due to competition. As soon as you unify multiple efforts into one
cooperative effort, you no longer have multiple efforts that produce multiple
viable drugs.

You're appealing to unify research efforts to put more wood behind fewer
arrows to help people. And that's fine. It just that this has consequences,
not all of which would likely be ones you want.

So, yes, the resulting medicine would BE the generic. And that's great! But
there is a drawback. And these are just the consequences we can easily
predict. We haven't even thought about the psychological effects of enforced
monoculture yet.

------
tammer
I used to work for a generics manufacturer, and indeed this was their MO. Seek
out old drugs that sill have a very viable market but are under the radar of
the big guys, undersell until they're the only supplier left, then jack up the
price when patients have no choice. It's despicable and seems inevitable with
the current regulation model.

~~~
jerf
At least in the US, that actually sounds like it's already illegal from
general business regulation. As in, no new laws needed, get the ones we have
enforced. Wouldn't be surprised you can already pierce the corporate veil
without new laws too.

This is not specifically in reply to the parent, but the point fits here: I'd
observe that calling for more regulation or even outright nationalization to
fix this, when it's probably _already illegal_ , is not thinking very clearly.
Regulations are already failing to prevent this... how is enacting more things
that make illegal things illegalier going to actually solve the problem? How
is doing the same, but more, actually going to help?

~~~
clavalle
Perhaps not more, but faster and perhaps more thoroughly in order to change
the player's risk assessment.

By the time these companies are called out they amass huge war chests and tie
these things up in the courts for years while enriching their investors and
management teams.

Then, when the hammer falls, that company disintegrates on some level and,
often, these management teams spread to similar companies and do it all over
again.

Obviously, something is not working. When something is not working the answer
is almost never 'let's keep things the same and hope it turns out better.'

~~~
jerf
My point is "Let's write more regulations" _is_ "let's keep things the same
and hope it turns out better".

It's easy to call for more regulations but it sounds a lot more to me like the
core problem is a priority mismatch in enforcement. A lot harder to fix, but
certainly step one seems to me to be to get people to stop calling for "more"
regulation and start calling for the core problem of ineffective regulatory
agencies to be addressed. Betcha if you took a look at what the relevant
agencies were doing with their time instead of dealing with this, you'd be
less than pleased.

~~~
clavalle
I've seen these kinds of things up close (investigations and eventual
prosecutions of exploitative companies in the health care sector) and I can
absolutely tell you I am not pleased.

But I also don't see the alternative. I don't think a free market approach
would work. The government has a huge standing war chest. It can afford to
take the time and expense to go after these bad actors. Even insurance
companies are rightfully reluctant to take on very expensive, risky litigation
and/or investigation that could run into multiple years or even decades.

The market is a wonderful tool, but it can't solve all problems. Some problems
are so big that it takes the pooled resources of, essentially, everyone to
fight against it.

~~~
jerf
I didn't say anything about a free market. I said, go fix the regulating
agencies. Way harder.

I'm a libertarian, but I'm not an "anarchist" because I still think it makes
more sense to have an industry, and an independent, focused, effective
regulatory apparatus. When you fall prey to the regulatory apparatus' ploy to
gain more power with yet more "regulations" by responding to their failures to
use _existing_ regulations to fix problems, you A: play a part in letting
these sorts of failures slip by B: reward the regulatory apparatus' failures,
creating more incentives for them to fail later and C: give them _another_
vector to "fail" and need "more power" to fix their failures in the future.

You want regulations to work, stop falling for this obvious ploy and start
holding your government servants responsible for the failures they are already
abundantly equipped with the tools to solve, instead of playing the sap and
joining in with the voices calling for more power, exactly as they want.
They've got enough to handle this problem. Go take them to task, don't hand
them more power even as they are demonstrating their manifold inadequacy to be
given even what they have.

------
ben_bai
Well, in german there is one word describing how to calculate something like
this: "Leidensdruckanalyse".

It's a dark word, because it basically means: Why give people drugs for $13.50
if the disease is horrible enough that they will, in the long run, accept $750
to ease the pain or to not die.

We have laws preventing something like this, but then the industry just has to
invent a "new" drug (basically the old one with a little difference in
formula), sell it at a higher price and then discontinue the old drug.

Sad world, we live in.

~~~
frogpelt
You may view it as sad.

But I think two things are happening: 1\. The price of the drug was
artificially deflated. 2\. The somewhat-free market is deciding how to handle
the correction.

If the market for this drug was interfered with and the price was not allowed
to go up, who's to say the manufacturer couldn't just discontinue the product?
Would that help?

~~~
tapia
I have to tell you that free-market cannot be applied to every market. It
doesn't work in education system and it certainly should not work in the
health system. Of course nobody wants to die, and people would theoretically
be willing to pay as much as possible to have a drug they need to survive.
That doesn't mean that this drug has to have an extremely elevated price or
not being produced at all if its non profitable. We are not talking about the
new iphone here, but about drugs that people need to stay alive.

------
healthisevil
That headline is just clickbait. It is available from Indian generic
manufacturers for around 2 rupees a tablet. That is about 3 cents a tablet.

India makes 80% of the generic drugs used around the world.

If US hospital administrators are paying $750 a tablet, it sounds like the
Indians have not bothered to apply for sales approval in the USA due to the
low profit margin.

~~~
ibejoeb
There is no generic approved in the US, at least. You can search ANDAs here:
[https://www.accessdata.fda.gov/scripts/cder/drugsatfda/index...](https://www.accessdata.fda.gov/scripts/cder/drugsatfda/index.cfm).

There is a little more user-friendly info here:
[http://www.drugs.com/availability/generic-
daraprim.html](http://www.drugs.com/availability/generic-daraprim.html)

------
esarbe
This is insane. But then again; the whole pharmaceuticals business is insane.
Why again do we have a problem with antibiotics resistant bacteria? Because we
stopped researching antibiotics in the 1970, because antibiotics weren't
profitable anymore. (That, and the practice to feed antibiotics to our
livestock to enhance growth, I guess.)

Research and trials shouldn't be done by the companies. Instead it should be
done by the state, then companies should be able to bid on an exclusive
contract to manufacture and sell the drug. The company that offers the lowest
selling price gets the contract. After the exclusive period, it becomes a
generic licensed drug, license feeds sponsor new research.

Don't know if that would work, but the current system is simply homicidal.

~~~
visarga
These guys are making a profit from people's sickness and desperation. I found
it distasteful to place making a profit above the mission of providing health
care. Market driven economy is blind to other concerns and only listens to
money.

------
thephyber
Interview with Shkreli about this price increase:
[http://www.bloomberg.com/news/videos/2015-09-21/why-
turing-i...](http://www.bloomberg.com/news/videos/2015-09-21/why-turing-
increased-price-of-daraprim-over-500-)

~~~
wdewind
I encourage everyone to watch this...maybe it's all bs but among the
interesting points Shkreli says:

-They have reduced or eliminated co-pays so no patient is paying as much out of pocket as they used to

-The drug is still 50% given away to people who cannot afford it

-The company ships drugs to patients before resolving disputes with insurance providers

-Shkreli's view is that it is in the best long term interests of the public to have a drug that can be insanely profitable be insanely profitable because it creates an incentive to create another better drug

-On that line, the company is researching new alternatives to the drug which are less toxic (ie: cannabalizing its own market)

~~~
themartorana
They're trying to fleece insurance companies. Guess who pays for that? Save
your $25 copay, you'll need it to pay your 40% (low end) year-over-year
premium increases.

------
appleflaxen
The same thing happened with ACTH, a hormone around since the 50s. [1]

It worked; the company with few economic prospects ended up being sold for
$5.6 billion [2]

1\. [http://www.nytimes.com/2012/12/30/business/questcor-finds-
pr...](http://www.nytimes.com/2012/12/30/business/questcor-finds-profit-for-
acthar-drug-at-28000-a-vial.html?_r=0)

2\.
[http://www.wsj.com/articles/SB100014240527023046401045794870...](http://www.wsj.com/articles/SB10001424052702304640104579487082990475704)

------
dsaum
Oddly enough, I think the story buries the lede. Near the bottom, refers both
to the fact that distribution of the drug very recently became controlled and
that Shkreli -- now owner of the drug -- has previously talked about
controlled distribution "as a way to thwart generics."

~~~
tankenmate
Prima facie evidence of monopolist behaviour?

------
JulianMorrison
Drug creation needs to be nationalized, 100% tax funded all the way from
researcher to trials to manufacture, and the drugs sold at cost thereafter.

And the pharmaceuticals industry needs to just go away.

~~~
brixon
The drugs might end up being cheaper, but there will be much less research for
drugs (aka less drugs in the future). Greed is a good motivator.

~~~
JulianMorrison
I actually don't agree at all.

There _is_ a big danger in the approach I gave, but it's political
interference. If the god-botherers can be forced to keep their mitts off, I
expect my way would create _more_ basic research and more simple effective
drugs.

Greed motivates chasing the slight change that will let your company replace
an ageing-out-of-patent drug with a freshly patented one, drugs for rich
people, drugs aimed at insurance payers, and it de-motivates improving the
basics.

~~~
ant6n
Also preventing hair-loss, and prolonging erections.
[https://www.youtube.com/watch?v=GA0l1JXhLaI](https://www.youtube.com/watch?v=GA0l1JXhLaI)

------
TomGullen
Revolting business practise. Nothing more to say about it really. At least in
other businesses there's more degrees of separation between the profiting and
misery you cause.

------
DanielBMarkham
I'm a libertarian and completely in favor of private property and an open,
informed marketplace.

Having said that, this is out of control. If you know you're selling me a
life-or-death product which has no peer, and the government protects your
property such that others can't make it cheaper? It's not a market. It's rent-
seeking, highway robbery.

Bad actors are going to cause an overreaction that is going to seriously
disrupt new product research. The thing for these companies to do is back down
while saving face. There are _real_ medicines that might cost this much to
develop, and we need to develop them. Polluting the pharma market with even
more price-gouging will not end well for anybody concerned.

~~~
andybak
> I'm a libertarian and completely in favor of private property and an open,
> informed marketplace. > Having said that, this is out of control.

It sounds like you're well on your way to realising the flaw in straight-ahead
libertarianism and joining those in the mainstream who want just enough market
regulation to allow free markets without a huge social cost.

I get the feel that most reasonable souls are in agreement on this. We merely
differ in how much we think is 'just enough' and the point at which social
benefits should trigger an intervention.

Both the right and left are also probably in agreement that historically
speaking - intervention has been problematic and flawed.

~~~
athenot
This is highly despicable as it's pretty much guaranteed that some people will
die from not being able to afford the med.

The market is not as efficient as we'd like to think. In a perfect libertarian
world, another company pops up and competes to drive the prices down. However,
even if the IP of the drug itself is public domain, there's a cost to ramp up
a new production line, all for a product which has low intrinsic value
commercially.

Shkreli purposely selected a drug that's needed enough (so guaranteed demand)
but whose market is not too large, preventing bigger companies from jumping
in. (And I'm ignoring for the moment his tactic to tightly secure the supply
chain, essentially trying to build a little moat around this product.)

This puts would-be competitors in a tough spot, where the risk is to invest in
setting up the manufacturing line, only to have the original company drop the
price again and ensure they won't be able to recover their cost. For the sake
of the patients, I can only hope there are generic makers who go for it
anyway.

------
kevindeasis
So firstly, "It is on the World Health Organization's List of Essential
Medicines, the most important medications needed in a basic health system"
[1].

Its obvious that this a great economic move in the short run.

What are the things that we can do so that companies aren't motivated by this
type of business model? What are the long term actions people can do so that
there are long term consequences for companies that do these types of price
jacking?

[1]
[http://apps.who.int/iris/bitstream/10665/93142/1/EML_18_eng....](http://apps.who.int/iris/bitstream/10665/93142/1/EML_18_eng.pdf?ua=1)

~~~
cheald
It's not obvious, because inclusion on the Essential Medicines list means due
to the TRIPS agreement, manufacturers can ignore patent restrictions on it
entirely. The ACA makes it possible for insurance to refuse to cover Turing's
drug; this gambit isn't going to work. Turing is going to get absolutely
destroyed by secondary manufacturers and imports here.

------
csomar
This explains it:
[https://twitter.com/MartinShkreli](https://twitter.com/MartinShkreli)

The guy is simply hilarious. Looks pretty innocent from the profile picture
though.

It looks like the real world version of Krang [1]. This is simply astonishing.

[1]:
[https://en.wikipedia.org/wiki/Krang](https://en.wikipedia.org/wiki/Krang)

------
ck2
Thread on reddit says it is 2 cents per pill in India and entire treatment
costs $1

[https://www.reddit.com/r/news/comments/3lp6kr/](https://www.reddit.com/r/news/comments/3lp6kr/)

~~~
eitally
India has aggressively forced international pharmas to offer exceptionally low
domestic pricing ... if they refuse, the alternative is that the Indian
government authorizes generics, regardless of the patent status of the
commercial drug.

India also has a "last mile" problem with medical care. It's still too common
for villagers to slip through the cracks and not receive regular diagnosis or
treatment.

~~~
unmole
> Indian government authorizes generics, regardless of the patent status

That is only for drugs considered 'life saving' though.

------
PythonicAlpha
It is about time to understand, that making business and money must not be the
only standard valid in society, but also some moral standards must apply.

If not, humanity as a whole will fail. What will be left of humanity: Some
trillionaires hiding behind barb wire finding out, that living without the
rest of the people is even worse than having only millions.

------
vijayr
At what point do we go from "nothing personal, just business" to pure
unadulterated evil?

Isn't there anything that can be done about this? It is not the first time
this is happening and will not be the last unless something is done.

------
detaro
18 hours ago:
[https://news.ycombinator.com/item?id=10248459](https://news.ycombinator.com/item?id=10248459)

------
trymas
It's so range inducing it's horrible. The guy is pure evil.

Though, my question is, what does it mean "to acquire/own/have the rights to
the drug"? If the drug is 62 years old, knowledge about it should be in public
domain and why can't some other company start making it?

~~~
DanBC
He owns the company that is the only current company making the drug. That has
some advantages (knowledge of process; supplier and distributor contacts;
control of distribution) but eventually another company will enter the market
and undercut the price.

Other companies do similar things. Look at the treatment for Age-related
Macular Degeneration - Avastin vs Lucentis.

Avastin is older, and cheaper. It's as effective as Lucentis. The same company
makes both. That company refuses to try to licence avastin for use with AMD,
which forces (at least, in the UK) doctors to instead use the very similar but
very much more expensive lucentis. The compnay claims there are problems with
avastin, but really those problems arise from incompetent handling ("People
might use non-sterile needles to inject avastin! Lucentis comes in a pre-
sterilised package!". Well, if you're worried about people using dirty needles
you need to fix a lot more about that hospital.)

People are going blind because corporate greed.

------
DanBC
The title changed, which means the Algolia search for previous discussions
(click the "past" link in the header) is broken.

This submission is a dupe of (killed, 2 comments)
[https://news.ycombinator.com/item?id=10250576](https://news.ycombinator.com/item?id=10250576)

and (not killed, many comments)
[https://news.ycombinator.com/item?id=10248459](https://news.ycombinator.com/item?id=10248459)

Dupe checking is clearly broken. Most of this page is dupes:
[https://news.ycombinator.com/from?site=nytimes.com](https://news.ycombinator.com/from?site=nytimes.com)

~~~
detaro
He didn't change the title, the article's title actually was changed. Compare
page and URL.

~~~
DanBC
Ah, thanks. Sorry.

I edited my post.

------
magoghm
Report about price going from $13.50 to $750 overnight => Hillary Clinton
Tweets plan to combat the high cost of prescription drugs => The Nasdaq
Biotechnology Index falls 3.4 percent.

[http://finance.yahoo.com/news/clintons-tweet-high-drug-
price...](http://finance.yahoo.com/news/clintons-tweet-high-drug-
prices-163148436.html)

~~~
mrinterweb
That is incredible that a presidential front-runner has that kind of market
influence in one tweet. It is clear that Bernie Sanders also has similar
intentions as the article mentioned him pursuing punishing these business
practices in August. It is insane that Medicare Part D made it so the US
federal government is not allowed to negotiate drug prices.

------
misnome
I was under the impression that this was entirely the purpose of generic
versions? At least in the UK (yes, I know we are relatively spoiled by the
NHS), almost every popular drug has a generic version easily accessible.

If I'm reading this right, the UK NHS price for BRANDED Daraprim is £13/30
tablets:
[https://www.evidence.nhs.uk/formulary/bnf/current/5-infectio...](https://www.evidence.nhs.uk/formulary/bnf/current/5-infections/54-antiprotozoal-
drugs/541-antimalarials/pyrimethamine/pyrimethamine/daraprim)

and the purpose is listed as primarily an antimalarial.

~~~
deskamess
Used Daraprim in the 80's when in Southern Africa. It was a mainstay and, as
far as I can recall, not expensive then either. I find this whole procedure
revolting; no innovation either.

------
danmaz74
> With the price now high, other companies could conceivably make generic
> copies, since patents have long expired. One factor that could discourage
> that option is that Daraprim’s distribution is now tightly controlled,
> making it harder for generic companies to get the samples they need for the
> required testing.

> The switch from drugstores to controlled distribution was made in June by
> Impax, not by Turing.

This is the culprit, and honestly I have no idea what "controlled
distribution" means in this context. Anybody would like to clarify?

~~~
paulmd
In order to produce a generic, you need to prove that it has the same efficacy
as the namebrand drug. It's not the same thing as a full FDA trial, it's
small-scale and you're basically just proving that you're ending up with the
same active ingredient and that it has the same effects in patients (i.e.
you're not doing something differently in the formulation/delivery that's
causing problems or impeding the efficacy of the drug).

You can't do that for these drugs, because the only way to get ahold of the
namebrand drug is from the official supplier, and they won't sell it to you.

~~~
danmaz74
Thanks for the explanation. But this rule - ie, not allowing the competitor to
buy the original product for testing - is _incredibly_ anti-competitive and
should be banned.

~~~
aianus
Or, you know, you could remove the stupid regulations around generics. I trust
Bayer is capable of copying some crappy 60-year-old drug without the FDA
taking 6 months to approve it.

~~~
cowsandmilk
Because Bayer has never had manufacturing issues[1]? And who decides what
companies are trustworthy enough to manufacture drugs?

Yes, Bayer is capable, but like many companies, they also have people in their
facilities that try to cut corners to make themselves look good. Passing the
FDA review is fairly straightforward.

[1]
[http://www.fda.gov/ICECI/EnforcementActions/WarningLetters/u...](http://www.fda.gov/ICECI/EnforcementActions/WarningLetters/ucm182206.htm)

~~~
aianus
> And who decides what companies are trustworthy enough to manufacture drugs?

You could consider them innocent until proven guilty if they have enough
capitalization and/or insurance to settle any lawsuits if they screw up.

------
mrinterweb
This is a good example of class-warfare. Making a life-saving treatment
unaffordable will ultimately lead to deaths of those without the financial
means for treatment. It is hard to believe that this kind of practice can be
legal.

------
PedroBatista
I'm really liking to see our resident Gourmet Libertarians either silent or
trying a contortionist number on this one. ;)

I mean, if the drug is that expensive just create another one and sell it half
the price!! amiright?

~~~
radmuzom
Off-topic but related, any article which challenge libertarian principles
seems to have suspiciously high number of comments as compared to upvotes on
the article (as far as I am aware, HN drops off these articles from the front
page quicker).

------
makecheck
One issue is that at some point "any profit" ceased to be considered a good
outcome, and companies are now expected to do better and better when this
makes very little sense.

I imagine a simple solution would be a "reasonable profit limit" law.

In other words, if there is evidence that your costs to manufacture are $X,
your sale price ( _especially_ in a monopoly scenario) ought to be strictly
limited to some "reasonable" amount over $X, period. Any desire for more
profit must then come from additional products or by taking additional risks
that incur new expenses.

In a situation like this where there is evidence that "yesterday" your costs
were $X, it can then be clearly said that your costs most certainly did not
increase overnight by over 50x so it shall be illegal to charge over 50x more.

~~~
fluidcruft
I don't know what the answer is, but excess capital always demands more. When
starved, the markets will feed wherever they can.

I will add my two cents, though. I think this is enabled by ACA and the drug
companies are playing a dangerous game if they don't want to end up with
Medicare-negotiated rates. Currently if you're uninsured or on a high-
deductible plan you pay full price for drugs. If you've got a more traditional
plan the insurance company and manufacturer play their typical monopoly money
game. If you want more amo for the fire look into the price increases for
EpiPen over the last few years.

------
sehugg
My favorite scam is when the pharma industry became pro-environment lobbyists
to get the government to ban generic inhalers:

[http://www.motherjones.com/kevin-drum/2013/10/heres-why-
your...](http://www.motherjones.com/kevin-drum/2013/10/heres-why-your-asthma-
inhaler-costs-so-damn-much)

------
ck2
When I see "treating a life-threatening disease" and $750 a pill, formerly
$14, I think people need long prison sentences to solve that.

If we can put food processors who knowingly ship tainted food in prison in
this country for endangering or even killing people, we can certainly imprison
people for endangering lives by preventing the reception of medication.

~~~
arbitrage
It's disheartening, but I think the logic in your first example is that the
manufacturer did not give the consumer a choice; in the second, the consumer
can choose not to pay, and die instead.

It's a horrid way to think about it, and it's a horrid ethical system that
gets developed when it all comes down to money.

~~~
ck2
Oh manufacturer has a choice too. Make a reasonable profit and live an
extremely comfortable life, or make an obscene profit, put people's very lives
in danger, and risk a long prison sentence.

The problem there is ZERO risk for them to make a pill $750, let's give them a
little motivation to do the right thing.

I mean why not even $75, why go directly to $750? Because insurance, that's
why. What about people in the medicaid-gap who cannot get insurance in this
country? There are millions of people who cannot get insurance in the USA to
this very day.

------
oneJob
Unfortunately, this is one of many ways the consumer is being fleeced by the
capitalist in the Rx market. I don't use the term "capitalist" to be
inflammatory or generically as understood when one says American Capitalism,
but rather in the economic sense. Persons who legally own capital and direct
its use. Most drug discovery and research / testing is accomplished by
academics and governments, and then somehow the capitalists take all the
credit and the profits. They have a bunch of different strategies, but they
all accomplish roughly the same thing: maximize the $ that ends up in their
bank accounts.

This is a must read for anyone interested on the subject:
[http://www.nybooks.com/articles/archives/2004/jul/15/the-
tru...](http://www.nybooks.com/articles/archives/2004/jul/15/the-truth-about-
the-drug-companies/)

------
mdesq
It seems like drug manufacturers should be regulated as utilities in some
regard. Sure, you can have competition, but at some point your products become
so important for normal societal life that you are regulated as to how much
you can charge, or how much you can increase costs.

------
rodionos
As much as my compassionate side is siding with hospitals and patients, the
company should be allowed to charge any price it considers reasonable for its
product. Also I didn't like the inconspicuous ad hominem attacks on the
supply-side players. The side-effect is that it leads the reader away from a
subtle observation that the fair market controls to prevent these policies are
simply missing and regulators have done little if nothing to prevent it. For
instance, what does it mean 'controlled' distribution? Why is it difficult for
the FDA to maintain reference formulas and manufacturing blueprints for all
approved drugs past their patent-expiration date?

~~~
ZenoArrow
Should they be able to charge whatever they want when they have no
competition? Isn't that against the whole free market ethos?

The logic being followed by this particular pharmaceutical company is that
because it's a niche market the impact of these large price hikes is minimal.
However, the impact is not minimal for those that depend on the drug, who are
getting stiffed, either left with prices they may not be able to afford or
increased insurance costs (either paid by the individual or their employer).

There should be a cap on behaviour such as this, such as prices cannot
increase 50% above inflation in a single year. Details would need to be worked
out but at least controls such as this would give the market time to respond,
bringing in new competition, etc...

------
DocCat
Seems like just another case of a businessman enjoying a slice of "American
way" pie! We can loathe or love him for it, but he is only guilty of greed.
Last I looked, this crime against our brothers and sisters is not recognized
by our legal system as a violation. Do we want government in the business of
setting prices and controlling such things across the board, or not? I am but
an ob/gyn fighting a losing healthcare battle. Both drugs discussed here
directly impact my women's care; their potential well-being. Thankfully, I
have alternatives in my armamentarium. I don't know about general practice
colleagues.

------
thomasrossi
This is an (at best) attempt to create some bubble, the revenues will go up
for a while -even if we all hope they won't, but they probably will- the
company will look so much better than what actually is. I wonder what for,
it's not that people won't recognize it. In EU it cannot be sold anywhere near
that price so he's looking only at US market. One thing I've noticed in other
companies with out-dated products is the customer care, apparently they are
very prompt in following up prospects, which builds some sort of weird trust.

------
sologoub
This is a bit odd, there are two prior submissions of this same article
(including my own) that didn't get de-dupped: \-
[https://news.ycombinator.com/item?id=10250576](https://news.ycombinator.com/item?id=10250576)
\-
[https://news.ycombinator.com/item?id=10248459](https://news.ycombinator.com/item?id=10248459)

Also, points count differences seem to support the hypothesis that there are
optimal times of the day to submit to HN.

------
wllchng
In an interview with Vox, Bernie Sanders covers how powerful the
pharmaceutical industry are, how they are a source of high medical costs in
US, and how prices should be regulated. He makes an interesting point on how
while many of his colleagues push for free trade (e.g. lettuce and tomatoes
from Mexico), we cannot import name brand drugs from around the world.
[https://youtu.be/S5vOKKMipSA?t=3m20s](https://youtu.be/S5vOKKMipSA?t=3m20s)

------
yumraj
Not directly related to this case, but if anyone is interested in how drug
companies lobby watch this: [http://www.cbsnews.com/news/under-the-
influence/](http://www.cbsnews.com/news/under-the-influence/)

Basically Medicare, despite it's size, is NOT allowed by the US Government to
bargain for favorable prices costing tax payers billions and billions.

------
nepstein
UPDATE: the price increase has been rescinded

[http://www.nytimes.com/2015/09/22/business/big-price-
increas...](http://www.nytimes.com/2015/09/22/business/big-price-increase-for-
tb-drug-is-rescinded.html?hp&action=click&pgtype=Homepage&module=first-column-
region&region=top-news&WT.nav=top-news)

~~~
lxe
This is a different drug. Looks like this isn't a unique case. Sounds like the
entire pharmaceuticals market is not a pleasant place.

~~~
nepstein
Ah, should've given it a closer look! Apologies for the mixup.

------
dogma1138
This is basically the worst case of patent trolling you can think off.
Toxoplasmosis is one of the most common infections out there, it's usually
asymptomatic but it's damn freaking scary (brain (and every other cell) eating
parasite meh, fucking cats). There needs to be some procedure to revoke data
exclusivity/patent protection in cases like this.

------
stephengoodwin
I'm not familiar with pharmaceutical patents. How does a company maintain
exclusive rights to market a drug for 62 years?

~~~
VikingCoder
I believe it's more that most companies keep making minor improvements, and
keep patenting then.

But with something like this, I believe they're just hoping it takes another
company a long time to get approval to ship a generic equivalent.

------
chinathrow
As someone with active Toxoplasmosis (yes, it's very rare) in my very close
vicinity, I say to Martin: F _ck you, you f_ cking scumbag.

His Twitter stream is also full of shitness these days.
[https://twitter.com/martinshkreli](https://twitter.com/martinshkreli)

------
bertil
Serious question, for the occasional lawyer: how likely is it that, based on
this behaviour, that Shkreli be accused of murder, with a US judge finding
grounds to that?

If that is the case, Switzerland would have to extradite him — and I doubt any
accusation of economic misbehaviour would have a similar impact.

~~~
anigbrowl
I'm not a lawyer, but I know enough to tell you that the probability is zero.
You can't be convicted of murder by omission, and you can't even be convicted
of criminal negligence unless you have a clear duty to act, which is not the
case here.

So say we're in the US, and I am walking down the street and discover you in a
hole in the ground that is full of water, and you are obviously about to
drown. There is a ladder next to the hole, and you ask me to put the ladder in
the hole; let's assume that I can do so at absolutely no risk or even
significant effort - all I have to do is press a button. If I don't you will
surely die.

Well in the US, I don't have to do anything. I can stand there and callously
ignore your pleas and watch you die and I won't get in legal trouble for it
(although I will probably become a social outcast). Unless you are a member of
my family or I am some sort of emergency worker or similar person with a
responsibility to render assistance (eg if I invited you into my yard and you
then fell into a hole), I have absolutely no legal obligation to help you - I
can't be charged criminally, and your anguished relatives won't prevail in a
civil lawsuit. There is no law against me being selfish or even sadistic (by
passively enjoying your suffering).

Of course the moral thing for me to do is to help you get out of the hole, and
most people would say that I should be even willing to risk some danger to
myself in order to save your life. But the law is not a moral system, and the
current theory at this point in history is that the limitation on my liberty
by being obliged to incur risk on your behalf is worse than the fact that you
may lose your life. This isn't entirely arbitrary; you read up on tort law
you'll encounter a depressing number of cases where incompetent people made a
good-faith effort to help and ended up making things substantially worse.

I would also like to point out that I personally prefer the risk of helping
out to doing nothing, but have long since given up assuming the same thing
about other people :-/

------
joeyspn
This kind of behaviour will slowly push patient associations and labs to seek
P2P solutions. A platform that connects patients, scientists and independent
labs in countries like Japan or Switzerland would cut all the middle-men
(pharma, FDA, etc) and would prevent these abuses.

------
geomark
I wonder if Martin Shkreli is looking over his shoulder now that this story
has gotten a lot of press.

------
ck2
Wait, big-pharma cured Hep C ? I completely missed that!

 _Gilead was accused of taking advantage of patients with its startling
sticker shock for hep C drugs, and the company had just cured the disease
without all the ugly side effects_

------
danmaz74
What prevents US hospitals from importing the drug, for example from Europe?

~~~
nrr
Anything going that route will lack FDA
approval/indications/contraindications, a Medicare baseline price, and
insurance companies willing to pay for it. This makes the average hospital
less willing to lean in the direction of self-importation.

Granted, this is import restrictions notwithstanding. Some substances can't
even be brought across the border except under penalty of imprisonment for
smuggling in a controlled substance. There are often no permits that one can
acquire, which means that the drugs must be manufactured in the US.

~~~
danmaz74
Thanks; I thought that for corporations, importing drugs was possible. So,
basically, big European pharma needs to produce its drugs for the US market in
the US?

Anyway, how ironic:

> lack ... a Medicare baseline price

------
option_greek
For any one curious about the prices of various drugs in India, try searching
it here: [http://medplusmart.com/](http://medplusmart.com/)

These are retail prices.

------
profinger
Well, they obviously did it so Martin could put together his badass monitor
setup! Can't say I blame them, it looks like he's got at least 4 and 2 are
stacked! </s>

------
ccvannorman
I'm not a socialist for most things (like tech companies), but stories like
this push me farther towards agreeing with nationalizing health care.

------
yeukhon
We need John Oliver to do an episode on this.

------
DocCat
Sadly, this is just another case of the "American way" getting in the way! Do
we want our government dictating business policy, pricing our not? Is there an
in between solution? I'm an ob/gyn and the drugs discussed in these comments
directly impact my patients.I shrieked upon hearing the news of this hike;
Thankfully I have options in my field. Don't know about general medicine,
though.

------
grej
This is a clear violation of the Sherman Antitrust Act (USC 15), and should be
prosecuted as such.

------
datashovel
When you see a cockroach there are probably hundreds behind the walls. I'd
like to see doctors start standing up to the big players when they do similar
things.

------
mnml_
62y old drug still under patent ? isn't it going public after 20 years ?

~~~
detaro
It's not under patent anymore.

------
justinzollars
This is criminal.

------
davidf18
Previous discussion of same article
[https://news.ycombinator.com/item?id=10248459](https://news.ycombinator.com/item?id=10248459)

------
cmiles74
The surprise voiced in this article is suprising. Now that the NY Times has
told me about it, this idea of buying the one company that makes a particular
generic drug and then raising the price ridiculously high makes a lot of
sense. I wonder if they thought they'd lower the price as sales dropped and
were themselves surprised when this didn't happen.

I gotta agree with jug5: "Breaking News: America doesn't understand making
profit in business."

~~~
ninkendo
It's not that America doesn't understand, it's that when you actually take a
step back and look at it, the idea of it is so deplorable it's a harsh
reflection of our society's values that it's legal at all.

I'm thinking about ways to elaborate and explain why it's so awful, but I'm
imagining it's obvious to you. I'd imagine this story is making its rounds
through all the major news outlets because it evokes soul-searching, not
because people didn't know it was possible.

~~~
cmiles74
I'm not so sure. There is the doctor that wonders "What is it that they are
doing differently that has led to this dramatic increase?" And the answer,
clearly, is nothing at all. They are simply raising the price.

I agree the idea is deplorable, but it seems so obvious in retrospect. That
the person who has made this idea a reality is a former hedge fund manager is
just the icing on the cake.

I'm not sure what the best solution to this situation might be, but I think
it's important to recognize that this is _also_ what happens when the only
goal is "make more money." In that regard, it should not be a surprising
development.

