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Drug Firm Offers $1 Version of $750 Daraprim Pill (chicagotribune.com)
An anonymous reader writes: We recently read about a U.S. company that bought the rights to a drug called Daraprim and then boosted the price over 5,000%. There was widespread outrage over this blatant price gouging, most of it focused on hedge fund manager Martin Shkreli. Now, a San Diego-based drug company called Imprimis has stepped in to fill the void. They announced that they'll be supplying capsules containing the same active ingredients in Daraprim for $1 per dose. Their CEO, Mark Baum, said they'll also start making alternative versions of other generic medicines that have skyrocketed in price lately. "Imprimis, which primarily makes compounded drugs to treat cataracts and urological conditions, will work with health insurers and prescription benefit managers in each state to make its new capsules and other compounded generic medicines widely available, Baum said."
This guy is a multiple-time asshole
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
Wow So there are drug companies out there who /aren't/ out to gouge every last penny out of the sick, disabled and dying...
My faith in humanity just increased somewhat -.o
Just hope Imprimis can actually afford to supply everyone at that rate, they're probably taking a loss doing that.
European Anarchists! Trying to destroy a healthy American monopoly!
Wait, sorry, let me take of this top hat and monocle. I don't even know where they came from.
How can I believe you when you tell me what I don't want to hear?
a good, healthy profit by helping those who are ill, but not an outrageous one on the back of gouging the sick.
But this whole story just seems... odd. Just to rehash it - a billionaire deuce canoe "with much evil" buys a company and hikes a drug price, and goes on TV to brag about it. Anyone not mentally retarded knows what happens here, it generates such outcry against the canoe captain that he gets 24x7 news coverage for a few weeks. Nobody is naive enough to think they would be immune to backlash here. Before the price hike can have any real long-term impact, angel company #2 comes out and says they'll supply our little angels with this miracle for $1, because think of the children.
Does anyone not find this odd? I mean, I don't know what the world has done to me, but it sounds like a setup from the very beginning. Either a bid to kill off the original company, to drive up stock in angel company #2, or some other motive that I just can't fathom.
I don't have a chronic or terminal disease, but if I had money lying around I'd invest it in this guy's company, just to encourge them to continue being one of the few anti-assholes of the world. More power to 'em.
Are YOU using the TOOL, or is the TOOL using YOU? Think about it!
But pulling stuff like buying the rights to a drug and hiking the price by 5,000% because you can, sure as hell should be.
It's also instances like that which make me laugh whenever I hear some industry rallying to have regulations backed off.
They'll probably lose money. But the good publicity might make up for it.
This story is like, so last week! Don't you have anything exciting to talk about? I mean, Hitler's taking over Europe again and nobody is noticing. What's up with you people?
The Hedge Fund Managers(tm) complete with ivy league MBA and a greed the grand canyon can't accommodate if it was filled from floor to rim with $100 dollar bills, look at the sick and dying as a revenue stream. They need it. They are willing to mortgage their house to have it. Its wrong for them to use a shotgun on our board of directors, but A-number-1 for our team to blackmail their life savings out of them. We can even lie and say "oh, research, look the research". And they are doing research. They research caviar, Bordeaux wine, 20,000 square foot 'getaway villas' mere steps from the sun washed beach complete with full staff, gold plated marble everything, parquet floors, and the 180 meter yacht complete with two little 45 foot skiffs to tour the inshore islands. They research how they can get more of the same. Why call in to work and then have to 'take calls' from potential angry investors when you can prey on the dying? As an antedote, there are many countries with 'public pharma' policies who don't won't state treasuries raided by their games, so there is open speculation that any drug costing more than $5 per pill will face a 'patent exemption' law, followed by local manufacturing labs filling the void for pennies per pill. Get greedy and they will override your monopoly and kill your market. Free market is one thing, but every company I've ever seen has wanted to 'game' the market. They cry when government stomps on their game, but they forget that their entire monopoly is man-made.
They've been losing money for four years, about 10M a year. It's a startup. All in all, this is pretty cheap advertising for them. But be aware that this is an advertisement. When Chevy says that they're truck will get 50MPG, get you to Colorado, and get you laid by the model onscreen you don't take them at their word.
Don't assume Imprimis is amazing because they put out an ad for their services.
"I will trust Google to 'do no evil' until the founders no longer run it." Hello Alphabet.
It's great to see the market correct itself without the need for government intervention.
"they'll be supplying capsules containing the same active ingredients in Daraprim for $1 per dose."
But you need 750 doses per day. Dammit Big Pharma, I think I'm out and you pull me back in.
Pretending this is my office full of bitter coworkers..
Really. This is a (rare) sighting of Capitalism doing good. There is an inefficiency (high price), and somebody comes in to fill in the void to make money.
(I hope there are no ulterior motives, though).
Are you trying to say Chevy trucks aren't able to go to Colorado?
How are we going to exploit this to divide people and get them to hate each other? And if problems get solved without government, how can we sell the idea that only government can solve problems?
all medical patents will become public domain immediately upon being granted.
And before you ask.. medical research will continue to be paid for with govt grants, just as it always has been.
Also, capitalizing the word "i" will no longer be required or encouraged.
Looking at their income statement, this loss it look like fiscal optimization.
TOTAL REVENUE 1,660k$
COST OF REVENUE 1,007k$
SELLING GENERAL AND ADMINISTRATIVE COSTS 10,477k$
TOTAL ASSETS 10,242k$
CURRENT LIABILITIES
ACCOUNTS PAYABLE 787k$
SHORT/CURRENT LONG TERM DEBT 24k$
OTHER CURRENT LIABILITIES 1,466k$
TOTAL CURRENT LIABILITIES 1,560k$
Something does not add up 1m of debt, 10m of assets and 660k$ of sales profits but operating loss of 10m
The two drug combo tablet, Pyrimethamine 25mg + Sulfadoxine 500mg, has many generic suppliers in India, for under 4 cents a tablet, with a lot more sulfa drug added in. The aseptic pilling and blister packaging probably cost more than the pyrimethamine at 1 cent.
$13.50 per tablet of 25 mg pyrimethamine was a joke and an utter ripoff. The $750 makes the French Revolution more understandable when they started shortening corrupt financiers and government royalists after a short trial...Sort of a closer shave with that super sized Gillete thing.
No he's not, LEARN TO READ ffs.
When Chevy says that they're truck
He's saying that you shouldn't believe someone who says they are a truck. They are LYING to you, they are actually just a person in a truck outfit.
If it's in you sig, it's in your post.
OK, Shkreli "bought the rights" to Diaprim and raised the price...now Imprimis starts making a generic for it. So what the hell did Shkreli actually buy? It sounds as if he didn't get any kind of exclusive rights for his money. Did he just get the rights to the name? Is he just banking on doctors refusing to check "Generic OK" on the prescription form?
I'm quite shocked that he didn't quintuple his revenue at $5/dose. He could have and still been lauded as a hero.
No matter; if it hurts Martin Shkreli I'm in favor of it. He still hasn't reduced his price, as he promised to 'after some research'.
The compound is basic organic chemistry. OK it is not that what you get in your kitchen, but they should be able to fabricate it for far less than the 1$ per pill (baring extremely exoctic and costly catalyzed reaction) most of it will be excipient anyway by weight. Packaging and advertising will be the highest cost. Packaging they will probably make it as cheap as possible, and advertising they got all that for free. So They may not earn a lot, but like all other which fabricate generics, they will not lose on price per pill. But they won't get ultra rich on it either.
C. Sagan : A demon haunted world:
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visit randi.org
Someone will spend $1B or so and invent a drug that cures cancer completely in 999,999 of 1M people, but gives horrible acne to 5 of them in the process. Those five and the family the one who was not cured will sue and win hundreds of millions of dollars for the lawyers involved.
They don't gouge the sick. No sick person can pay those costs. They gouge the insurance companies, who now get your money at gunpoint. Anyone who expects prices and costs to go down under those circumstances is nuts.
Part of the problem here is that the FDA requires generics do need to undergo testing similar to the original product (instead of merely proving that the ingredients in the generic are the same as in the original product), which can take years and millions of dollars. These FDA requirements make generics expensive to produce -- meaning that generic versions of many drugs do not exist. Without the FDA requirements, the market would take care of ridiculous price bumps by bringing in competitors.
Now, I just claimed that the FDA makes it hard to bring generics to the market, so how did a competitor spring up so quickly in this case? The answer is that the new manufacture seriously bent FDA rules: the product mentioned in the description is _not_ FDA approved. The company making the product is not a standard drug manufacturer; it is a "compounding pharmacy" -- meaning that it can skirt FDA rules by making batches of drugs for one individual at a time (not making huge batches and selling them to Wallgreen's, CVS, etc.) Since this drug is not widely used, this approach may work. However, the FDA regulations are still a burden in general (and the FDA still has some power to put the kibosh on compounding pharmacy).
See http://marginalrevolution.com/... for more information
any other requests?
Capitalism is directly or indirectly responsible for most of the technical and medical advances that exist in the world. The alternative to capitalism is that there is no reward for innovation, and thus no innovation.
Any chance for 1 of 3? I can fly to Colorado and fill up more often if need be.
This shows that the mega charities pulling in millions should not just invest in research but also owning patents on critical drugs. Stop with the retarded profits and get more life saving medicine to people who really need it.
Why are you mixing up the income statement and balance sheet? If you want to make a point, you might want to take Accounting 101... so you don't look like a moron asking moronic questions.
The income statement clearly shows that the product sells for slightly more than the cost of producing it, generating a very small gross profit. Then deduct the $10 million in fixed costs and you've got the $10 million loss you were looking for.
Is this some kind of robot in disguise?
What if it's a transformer? Robots in the skies and all that.
The formulation is part of the patent, thus public.
They don't need to reverse engineer anything.
Fucking moron
Rainbows are doable, but the GM for the unicorns may run into problems.
I've been working in the prescription benefits industry for a few years... I am not making any of the following up.
Pharmacy negotiates drug price with manufacturer/wholesaler (Price A)
Pharmacy negotiates drug price with prescription benefits co (ie Express Scripts) (Price B)
Member enters pharmacy with script, buys drug, pays copay (Price C)
Pharmacy submits a claim to the prescription benefits company for Price B.
Pharmacy pays drug manufacturer Price A.
That should be the end of it, right?
Wrong.
Prescription benefits company negotiates drug price directly with manufacturer. (Price D)
Prescription benefits company submits rebate claim with manufacturer for difference between Price B and Price D.
So that's the end, right?
Wrong.
Most large employers have contracts with prescription benefits managers for Administrative Services Only (ASO).
In short, this means that the employer pays the benefit manager for all benefits actually paid out.
Employer pays PBM for drug (Price E)
And finally, we're done.
the sky? How did those countries get to be wealthy?
Wasn't what he did known as insider trading?
Manufacturer's cost $1
Pharmacy pays manufacturer $3
Insurance pays contract price $4
Consumer pays copay $0.50
Insurance collects rebate form manufacturer -$1
Manufacturer profit: 100%
Pharmacy profit: 50%
Insurance profit: 3,000%
The market works. When permitted to. What a surprise. (To some.)
For those that think "gouging" is awful, I recommend the EconTalk podcast on the subject. http://www.econtalk.org/archiv...
There's no time like the present. Well, the past used to be.