
Drug made famous by Shkreli’s price hike is still $750 a pill - rbanffy
https://arstechnica.com/tech-policy/2018/05/drug-made-famous-by-shkrelis-5000-price-hike-is-still-750-a-pill/
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Clubber
Sure, while everyone was feeling smug about Shkreli being thrown in jail, we
ignored the actual problem. It was a huge distraction and I would guess
manufactured.

~~~
simula67
He was not convicted for raising prices

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A2017U1
His punishment seems quite unique compared to similar corporate crimes.

~~~
lainga
He was convicted more as an example to other people who might be inclined to
disrespect the courts as he did.

~~~
gameswithgo
Yes, now white collar criminals will be reminded to be polite in court so they
can get their free pass in the future.

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rb808
> It’s an off-patent, decades old drug ... It costs pennies to make and
> generates little profit. Only a few thousand patients need it each year.

Sounds like the old price of $13 was way too cheap. Given that its off patent
and still no one else wants to make it I'd think the new $750 prices is
probably not crazy.

~~~
chimeracoder
> Sounds like the old price of $13 was way too cheap. Given that its off
> patent and still no one else wants to make it I'd think the new $750 prices
> is probably not crazy.

On top of that, there was an investigative article a while back that tried to
measure the actual effects on patients.

Turns out, they weren't able to find any patients who themselves had to pay
anything close to $750/pill for the drug. It's not prescribed that commonly in
the US, and the only patients who needed it were all on insurance plans that
covered it, subject to standard copays and deductibles. Many of the patients
already meet their annual maximum deductible anyway, due to the other medical
care they already have to receive, so the marginal cost to them was $0. In
other words, raising the price of the drug literally did not increase the
price that those patients had to pay by one cent.

I'm aware that this has a complicated and implicit impact on prices elsewhere,
but that's the real problem: medical billing is _ridiculously_ convoluted, and
focusing on the price of a single drug - especially the price that isn't
actually paid by any consumer - is missing the real problem that needs to be
fixed.

~~~
monocasa
But they are still paying it, it's just obfuscated.

Since the ACA capped profit percentages, the insurance companies have been
looking for ways to increase pay outs, os they can increase total revenue, and
then total profit. That perverse incentive is one of the reasons why insurance
premiums have been going up so much the past few years.

~~~
hristov
Insurance premiums have been going up long before the ACA was passed into law.

~~~
chimeracoder
> Insurance premiums have been going up long before the ACA was passed into
> law.

They've gone up _much_ faster after the ACA has gone into effect.

~~~
zzzeek
please cite your sources.

Here's one that contradicts this directly:

[https://www.forbes.com/sites/robbmandelbaum/2017/02/24/no-
ob...](https://www.forbes.com/sites/robbmandelbaum/2017/02/24/no-obamacare-
hasnt-jacked-up-your-companys-insurance-rates/#4f22443a3a01)

> Except that it doesn't seem to be true. Health insurance premiums have been
> rising for decades, almost (though not quite) as stubbornly reliable as an
> eastern sunrise. And it turns out that these increases actually slowed after
> the Affordable Care Act became law in 2010. That's according to data
> collected by the U.S. Department of Health and Human Services, which tracks
> a range of topics around spending on health care in its Medical Expenditure
> Panel Survey. The survey tracks the health insurance offered by private
> firms big and small, and in all cases, the average rate of premium growth
> from the time the law passed in 2010 through 2015 was actually lower than
> from 2004 to 2010. And premium growth was lowest for firms with fewer than
> 50 employees.

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chollida1
Interesting side note, one of hte companies that Shkreli tried to buy was
KBIO. This became exhibit #1 for people to point to whenever someone ask them
why they don't short a stock if they are so sure of their convictions.

The stock went from $0.90/share to as high as $45/share overnight. If you were
short you were very screwed as your broker bought you in at h igh prices that
dropped pretty quickly after that.

Never hold a short overnight unless you are really really sure and even then
never hold a short overnight no matter what if its a penny stock. They are
just too volatile and can see 500% + price spikes.

[https://www.thestreet.com/story/13374131/1/kalobios-
pharmace...](https://www.thestreet.com/story/13374131/1/kalobios-
pharmaceuticals-kbio-stock-soars-after-naming-shkreli-ceo.html)

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swarnie_
At this price point can't a company from India knock out a few million pills
for cents a unit and undercut the market?

~~~
pg_bot
This has already happened. Daraprim (Pyrimethamine) is available today in
India for pennies.[1] You can't import it into the United States without
breaking the law. The American public should be outraged at the FDA for
disallowing drug importation and their overwhelmingly onerous ANDA policy.

[0]
[https://en.wikipedia.org/wiki/Pyrimethamine](https://en.wikipedia.org/wiki/Pyrimethamine)

[1] [https://www.ibtimes.co.uk/daraprim-like-drug-costs-
less-0-07...](https://www.ibtimes.co.uk/daraprim-like-drug-costs-
less-0-07-india-1521144)

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notyourday
> It costs pennies to make and generates little profit. Only a few thousand
> patients need it each year.

And it is covered by _insurance_. This is exactly how one leverages
inefficiencies of the insurance market place - insurance companies cover it
and they are charged that rate.

~~~
arcticbull
Not for the uninsured, or the underinsured (with enormous deductibles) -- and
that's the real problem. With a national socialized program, they could
negotiate the prices while ensuring everyone who needs it can get it.

~~~
notyourday
So far, all the investigations failed to find uninsured people who got hit
with this charge. They have found people lamenting that _if such people had no
insurance, then it would have been very expensive for them_

~~~
simonh
Of curse you can't find people who directly paid such an outrageous cost,
we're talking about people who by definition can't afford medical insurance.
What on earth makes you think any of them can afford $750 a pill? That's the
whole point of this issue, it's not that people get gouged which is bad
enough, it prices people out of getting the vital treatment they need even
though the true economic cost of the treatment is trivial.

