The Monsters Behind the Medicine Cabinet
It is probably the worst kept secret in our economy that Big Pharma is driven by an almost sociopathic need to make profits. All other ethical or moral considerations are sidelined in favor of the bottom line. The fact that these companies are delivering healing medicine to sick and suffering people makes the greedy nature of Big Pharma even more disturbing. To be clear, this opinion piece is not aimed at all the companies within the pharmaceutical market. However, it absolutely does target the capitalist businesses whose primary objective is to make profits for their shareholders through less than scrupulous tactics.
Taking a trip down memory lane to 2015 may elicit some cringe-worthy memories for the reader, but I encourage all to do it. By remembering 2015, one may recall the outrage most people felt at the actions of the “most hated man in America.” Martin Shkreli, former hedge fund manager and chief executive of Turing Pharmaceuticals, had been the key decision maker in the scandal surrounding Daraprim.
The brief history of the scandal surrounding the life-saving drug can boil down to a singular economic concept: price-gouging. Daraprim is a pill for people that suffer from severely low immune systems, such as HIV/AIDS patients and even people with certain types of cancer. It is inarguable that this drug is necessary for their survival. So, economically speaking, the demand is pretty much inelastic. A drug that previously cost $13.50 was raised to a shocking $750 per tablet, a 5000% increase. The economic burden per patient is $634,500 every year, which is unsustainable at best, and criminal at worst. Especially within the context of the state of the healthcare system in the US, many patients had to choose between two options: bankruptcy or life. What is even worse, nothing was changed about the drug to justify this distressing price hike. The only thing that was altered was that Shkreli had acquired the right to distribute the critical drug.
The original costs were the same. Daraprim still cost $1 to make.
Shkreli, also known as “everything that is wrong with capitalism” and a “morally bankrupt sociopath,” was forced to face an outpouring of public hatred. However, nothing seemed to fluster this smirking and smug CEO. When defending himself on Twitter, he expertly managed to navigate this public backlash, by asserting that, for example, “@JohnCFierce you are such a moron,” and that “no one is reading this… you are irrelevant.”
When explaining the economic decision behind the price hike, Shkreli assured the interviewer that “profits are a great thing.” Yes, so is having economically attainable access to a life-saving drug, but I digress.
As a consequence of our short attention span, interest in the story faded after Turing assured everyone that the price would be lowered to something “affordable.” However, infamous Shkreli returned to the spotlight once again in 2018. Having been convicted of Securities fraud, he was sentenced to 7 years in prison. Smirks turned to sobs as he pleaded with the judge. “Do not feel bad for me,” cried Shkreli. Don’t worry, Martin, nobody does, just like nobody believes your statement that “I was never motivated by money”. However, while Shkreli deserved prison time, he did not get convicted because of his actions in regards to Daraprim. That crime still goes unpunished. Just like all other crimes in this sector that seeks to profit from the sick.
Raising prices to ridiculous extents is not a trend in Big Pharma. It is a driving force.
There are almost too many examples to give, such as the Valiance scandal or when the EpiPen price rose from $100 to $1,300. How is it possible that pharmaceutical companies are able to set prices without any regard for the consequences? That is because, “unlike… nearly every other advanced nation, the US healthcare system allows manufacturers to set their own price.” As a result of Big Pharma acting with complete impunity, Americans pay twice as much for their prescription drugs as any other country on Earth. As such, when analyzing the staggering price escalations in the products of these companies, one is confronted with percentages that range from a 522% increase to an astounding 8281% increase. Consequently, it is a fact of reality that drugs that were previously priced at, for example, $20 now end up costing the customers $1,849, as is the case with Doxycycline Hyclate (used to treat various critical infections).
It appears that Big Pharma possesses the Midas Touch, as they turn seemingly generic drugs into gold. I will leave all ethical and moral considerations to be analyzed by the reader. However, as these companies make millions and CEOs like Martin Shkreli cash in their bonuses, Daraprim continues to be priced at $375, a 2500% increase from its original price. The patients that rely on this drug to stay alive are still suffering, and the drug is still inarguably priced at a level that is unaffordable and criminal.
Comments