Ex-Hedge Fund Manager Who Jacked Up Price of Drug by 5,000 Percent Gets Lesson in Free-Market Capitalism
Oct. 23, 2015 10:56am Dave Urbanski
If you don’t know his name, you probably know his face — not to mention his drug company’s recent 5,000 percent price increase for a generic medication used to treat cancer and AIDS patients.
Martin Shkreli was widely criticized late last month after his Turing Pharmaceuticals announced an increase in the price of Daraprim — the only approved treatment for a life-threatening parasitic infection — from $13.50 to $750 per capsule after buying rights to sell the drug.
But now the former hedge fund manager has competition.
A San Diego biomedical company on Thursday announced it’s selling an alternate medication to Daraprim for $1 a capsule, the San Diego Union-Tribune reported.
Mark L. Baum, CEO of Imprimis Pharmaceuticals, told the paper that one catch is that its formula isn’t FDA-approved and may be sold only through a doctor’s prescription to a specific person. He added that the process of getting FDA approval would take years and cost millions, while not filing keeps prices low and profits higher.
Shkreli initially said the price increase of Daraprim was needed to fund future research on the 60-year-old drug, which some doctors said wasn’t needed. Then Shkreli backed off and said he would reduce the price. A Turing spokesman last week told The Associated Press that the company is still determining the “most appropriate price for Daraprim” but has capped per-prescription co-payments at $10 for patients with commercial insurance and $1 for Medicaid beneficiaries. It’s also offering Daraprim free for patients who can’t afford it, according to Edward Painter, head of communications and investor relations.