Martin Shkreli wants you to swallow his bitter pill — and to thank him for making you pay $750 for it.
For 62 years, the drug Daraprim has been the standard method to treat parasitic infections that are particularly life-threatening to AIDS and cancer patients. It was relatively affordable — though low-income patients might take issue with calling an $18 pill “affordable” — and highly effective in treating these infections.
Then last month, Shkreli and his company, Turing Pharmaceuticals, came along and acquired rights to the drug. Their contribution to better the lives of these patients?
Jacking up the price 4,000 percent.
It will now cost a patient battling AIDS or cancer $750 for a single life-saving treatment. Even those with good insurance still need to cover 20 percent of the cost, which can amount to $150 per pill. And it will assuredly result in treatment delays as insurers increase scrutiny on approving the use of the drug.
Shkreli, a 32-year-old former hedge fund manager, has been indignant in defending his action. He says the move was a matter of “us trying to stay in business,” and that he’s just trying to help. “I can see how it looks greedy but I think there’s a lot of altruistic properties to it,” he says.
That’s right. Shkreli is actually making the case that his price gouging does us all a favor.
If this is altruism, Mr. Shkreli, I’d hate to see what greedy looks like.
He has even taken to Twitter to antagonize people seeking answers.
@zoninoz you know, ambien
— Martin Shkreli (@MartinShkreli) September 21, 2015
While it appears Shkreli isn’t having problems sleeping at night, his customers sure are. This price-gouging will drive many more into the red, exacerbating an already-serious debt crisis. Medical debt is the No. 1 cause of personal bankruptcy, and many have lost their homes because of an illness. I have personally been sued for medical debt accrued from chemotherapy treatments. No one should go through this simply because they got sick. Health care should be a basic human right.
But that’s not how Shkreli sees it. Rather, he sees an opportunity to maximize return on investment for his investors. And he basically says as much:
Besides the sticker shock of a $750 pill, to truly understand why we should be outraged, we need to take a step back and look at the broader systems at play.
The price jump is the byproduct of a system designed to maximize the amount a company can extract from someone who is in desperate need of a product. That is the very definition of price gouging.
This is what happens when a public good — health care — is a for-profit enterprise.
It is a system we all perpetuate by not demanding a patient-centric system. But it is also a system that entrenched special interests have heavily invested in maintaining.
Big Pharma has gotten away with artificially inflated drug prices for years because the industry has purchased significant influence over Congress, as outlined in the Alliance’s report, “Bad Medicine: Pharmaceuticals’ Prescription for Profits over People.”
The industry’s stranglehold over Congress is remarkable. Big Pharma employs two lobbyists for every member of Congress. From 1998 through 2013, the industry spent nearly $2.7 billion on lobbying expenses, more than any other industry, and 42 percent more than the next-biggest spender, insurers.
The optics of this inequity in action are stunning. But ultimately, we shouldn’t be surprised by Shkreli’s gouging and mind-boggling defense of his actions. This is coming from a CEO who made a name for himself as a hedge fund manager urging the Food and Drug Administration to deny drugs produced by companies not in his portfolio.
If you will recall, the top 25 hedge fund managers make more than all of America’s kindergarten teachers COMBINED. In fact, here’s a little movie that will tell you more about this glaring inequity:
Unfortunately, there are hedge fund managers and pharmaceutical CEOs who have a world view of profit maximization rather than putting patients first. If only we demanded a system where people who need the help can get it, perhaps we wouldn’t see egregious examples of exploitation like this.
Ben Henry is Senior Policy Associate for the Alliance for a Just Society.