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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."
He didn't go on TV to "brag" about it until the Internet got ahold of the story. And I wouldn't call it bragging -- he seemed (to me when I saw the story) to think in his own twisted mind that this was a greatest good argument -- that him making lots of money off of other people's lives would somehow help his business help other people. Bragging would be if he thought he was getting away with evil. He seemed to think he wasn't. He's still evil, but not inside his own head.
The angel company is a new startup that is trying to break into the market, and this is cheap advertising for them, even though they're going to lose money on the pills at that rate. It's a brilliant move, and an example of why you can only push a monopoly position so far before someone will find a way to undercut you.
Long and short of it: I don't think there's any conspiracy here.
No, I don't think it's odd, considering that the price of the pill was originally $13 each. If one person were pulling the strings at both companies, it would be absolutely idiotic to hike the price just so they can eventually *cut* the price to less than a 10th of the original cost.
Which is why generics are typically pretty affordable, except where there are not enough manufacturers competing. The problem is that you want new drugs, that you previously couldn't buy for any price, to be priced similarly to generics once discovered, and drug companies want to segment the market to maximize profits. If they could, I suspect they would have a different price for each individual.
Insurance exacerbates this problem, because patients with it don't see the price where it counts, so they don't pressure doctors to try less expensive/generic drugs first. Insurance companies are evaluated on percent of premiums paid on claims, so they also don't have an incentive to cut costs—the higher he medical costs are, the more they can charge in premiums.
Can you be Even More Awesome?!
And that's why he belongs in the slammer. He had not a single concern for people's lives as long as he could make big bux tap dancing on the line between shrewd investments and fraud.
You'd have a point if there weren't a company making a cheaply available $1 generic (and then pledging to do the same with several other drugs). But don't let that get in the way of your angry screed.
capitalism at work
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