Martin Shkreli. (photo: Joshua Roberts/Reuters)
08 February 16
They throw lavish boat parties while marking up life-saving medication 5,000 percent.
ancy
Retzlaff is not Martin Shkreli. She won’t inspire hundreds of news
articles nor will she become the subject of any Internet memes. She
won’t threaten Ghostface Killah and it seems unlikely that she will ever
flirt with a minor on a YouTube livestream.
But the chief commercial officer for Turing Pharma is
just as responsible for keeping the price of the life-saving drug
Daraprim 5,000 percent higher than it used to be. And as long as the
public eye is still trained on the Shkreli sideshow, she’ll get away
with it.
During last Thursday’s congressional hearing on
prescription-drug pricing, Retzlaff sat next to her smirking ex-CEO,
calmly defending her company’s choice to keep charging $750 per pill for
Daraprim, which is used to help pregnant women, HIV patients, and other
immunocompromised individuals fight off toxoplasmosis infection.
She even admitted that Turing handed out large salary
increases and held a lavish boat party while the year-old pharmaceutical
company was still reportedly in the red.
“Do you know who Metro Yacht Charters is?” Rep. Jason Chaffetz asked her.
“Uh, yes, I do,” she admitted after a pause.
“Why would you know them?”
“I believe we rented Metro Yacht Charters for a sales force meeting,” Retzlaff replied.
“Yeah, for a party. Twenty-three thousand dollars”
Chaffetz said, consulting Turing documents. “Did you spend money on
fireworks?”
“Yes.”
“Did you spend money on a cigar roller for a yacht night?” he persisted. “Eight hundred bucks?”
“Yes, we did,” was Retzlaff’s response.
It should have been the story of the hearing: Turing
Pharma partying on the dime of the hospitals and insurers who are now
paying exorbitant amounts for Daraprim, which used to cost $13.50 per
pill. Instead, Martin Shkreli stole the show by repeatedly pleading the
Fifth Amendment during his own questioning before leaving the room and
calling Congress “imbeciles” on Twitter.
Shkreli’s stunts have been effective in drawing public
attention to the problem price gouging in the pharmaceutical industry.
But now that he’s at the center of that conversation, he’s threatening
to suck all the air out of the room. And if the Pharma Bro has been
telling the truth about one thing, it’s this: This problem is so much
bigger than him.
For one prominent example, all you have to do is
follow his trail. In 2014, Shkreli, then the CEO of Retrophin bought
Thiola, used to treat the rare kidney disease cystinuria, and raised its
price from $1.50 to $30 per pill. Shkreli was then fired from the
company but his price hike lived on. A single 100-milligram tablet of
Thiola at a New York City pharmacy costs around $36.
The current CEO of Retrophin is Stephen J. Aselage and
his name is not on the front page of any newspapers. He doesn’t tweet.
He didn’t buy a Wu-Tang Clan album. But he still hasn’t reversed
Shkreli’s decision.
Outside of Shkreli’s sphere of influence, there are still more cases of extreme price hikes.
As Bloomberg reported, a recent DRX survey of around
3,000 brand-name prescription drugs found that prices had been at least
quadrupled in 20 cases and doubled for 60 since December 2014. The most
dramatic increases—of 500 percent or over—include a heart disease
treatment, a beta blocker, and an antidiabetic drug.
“The data shows that price increases are an integral
part of the business plan,” Jim Yocum, executive vice president at DRX,
told Bloomberg of the survey.
It’s disappointing that it took Shkreli’s antics to
bring this problem to the attention of Congress. Now, at least, some of
these companies are being asked to account for their price hikes even if
they don’t have notoriously mouthy leaders.
Valeant Pharmaceuticals, the company behind two of the
most egregious increases of recent years, was also present during last
week’s hearing at the House Committee on Oversight and Government Reform
but their representative, at least, had the good sense to act contrite.
“Where we’ve made mistakes, we’re listening and we’re
changing,” Howard Schiller, interim CEO of Valeant, said before the
committee, adding that “our price increases in the future will be well
within industry norms and much more modest than the ones that drew your
legitimate concerns.”
In February of last year, Valeant had raised the
prices of two heart medications, Nitropress and Isuprel, by 525 percent
and 212 percent.
Retzlaff, on the other hand, was unrepentant, saying
that she was “comfortable” with the decision to raise the price of
Daraprim under Shkreli’s tenure. In her prepared statement, she trotted
out the same excuses that the former CEO once used to defend the price
hike: some revenue was used on research and development, hospitals were
given a “discount”?which only reduces the price of a 100-count bottle to
a $35,000?and patients were given access to an assistance program.
“I believe the decisions made by the company have been
appropriate and strike the right balance between patient access,
innovation, and shareholder value,” she concluded.
She said this even while sitting next to the smug
32-year-old ex-hedge fund investor who wrote “$1 [billion] here we come”
in an email to the Turing board when they were about to close the deal
on Daraprim.
Under questioning from Chaffetz, Retzlaff noted that
Turing’s first-year net sales were $20 million, largely resulting from
sales of Daraprim, which she estimated is only used to treat about 3,000
people.
And under fire from Rep. Elijah Cummings, she claimed
that Turing’s attempts to secure a meeting with the president of the
Human Rights Campaign was not PR maneuvering but an attempt to “engage
all important stakeholders to make sure they were aware that the most
vulnerable patients suffering from toxoplasmosis … can access that
product at a penny per pill.”
Martin Shkreli became the public face of price gouging
because he was so transparent. But Retzlaff’s cool, calm, and collected
attempt to spin the same exorbitant price increase for an HIV drug as a
net good is arguably more dangerous because it is less obvious. Hate
the man who raised the price but beware the executive who cleans up his
mess and answers questions about the cost of a cigar roller with a
straight face.
There are more Martin Shkrelis out there, and not all
of them are acting like assholes on Twitter. And if the Shkreli Show
overshadows the people who still need easy access to a once affordable
treatment, everyone loses. The Pharma Bro started out as a poster child
for a pressing problem. He may end up being a red herring.
Martin Shkreli can go to jail. But that won’t change the price of Daraprim.
Comments
+11
#
2016-02-08 11:12
"Martin Shkreli can go to jail. But that won’t change the price of Daraprim."
No, but it will make me feel better, like maybe there IS some justice to be had in this world...
No, but it will make me feel better, like maybe there IS some justice to be had in this world...
+13
#
2016-02-08 11:29
Haven't even read the
article, too early in the morning to be nauseous. But Shkreli-Boy is
the logical dialectical outcome of psychopath capitalism. Throw the book
at the little prick, although acc. "market practices" he hasn't done
anything wrong. Punishment seems unjust? So what? Socialized medicine,
folks. Say, is tarring and feathering illegal?
+16
#
2016-02-08 11:42
OK, read it. Throw
the book at Nancy and Howard too. Then again, maybe Nancy should be made
president - we DO need a woman, and she exemplifies the virtuous
aspects of uh, "healthy business practice." Don't these assholes know
that this is the kind of thing that provoked revolutions, French,
American and Russian?
"“our price increases in the future will be well within industry norms and much more modest than the ones that drew your legitimate concerns."
Well now, that is exactly the problem - "industry norms" - norms of usury, cruelty and de facto homicide.
"“our price increases in the future will be well within industry norms and much more modest than the ones that drew your legitimate concerns."
Well now, that is exactly the problem - "industry norms" - norms of usury, cruelty and de facto homicide.
+5
#
2016-02-08 13:12
"our price increases
in the future will be well within industry norms and much more modest
than the ones that drew your legitimate concerns."
--Well now, that is exactly the problem - "industry norms" - norms of usury, cruelty and de facto homicide.--
Thank you, brilliantly said. Dead or suffering people come in second, at best (third or worse also seems likely) to "shareholders", even when that "shareholder" is a large hedge fund or private equity group.
--Well now, that is exactly the problem - "industry norms" - norms of usury, cruelty and de facto homicide.--
Thank you, brilliantly said. Dead or suffering people come in second, at best (third or worse also seems likely) to "shareholders", even when that "shareholder" is a large hedge fund or private equity group.
+7
#
2016-02-08 13:09
Wonder why your doc
is behind in his schedule? Ever changing drug prices and formulary
changes are a large part of it. Coverage for this or that drug is
changed arbitrarily and this applies to older, generic medications as
well. It is frustrating to use my time addressing problems that were
stable and now are urgent because of some non-medical desk person. A
trend I've noticed lately is renaming old, cheap medications and
charging big bucks for them.
The health care crisis is far from fixed. The ACA has some important provisions, but still caters to insurance companies and pharmaceutical giants.
I'm buried in the damn computer screen instead of practicing the thoughtful and compassionate medicine that I learned from many excellent Preceptors.
The health care crisis is far from fixed. The ACA has some important provisions, but still caters to insurance companies and pharmaceutical giants.
I'm buried in the damn computer screen instead of practicing the thoughtful and compassionate medicine that I learned from many excellent Preceptors.
