Every so often, there is somebody in the news who stirs up almost universal outrage. In late 2015, that person would almost certainly be Martin Shkreli.
Mr. Shkreli has emerged as a symbol of pharmaceutical greed for acquiring a decades-old drug used to treat an infection that can be devastating for babies and people with AIDS and, overnight, raising the price to $750 a pill from $13.50. His only mistake, he later conceded, was not raising the price more.
When Shkreli was shown after being arrested, it brought cheers to many even though his arrest for securities fraud had nothing to do with his controversial drug pricing.
You would think that someone so reviled would provide a great business opportunity for somebody to sell dartboards with his likeness on them. And you would be right.
Shkreli defends himself by saying that he was only doing what any good CEO would do which is to make as much profit for his company as possible. True enough. But at what cost to others?
And while Shkreli enraged many because of the blatant cockiness behind his pricing tactics, is this any worse than what so-called Big Pharma is doing to the American people?
...in some ways, Mr. Shkreli, chief executive of Turing Pharmaceuticals, has taken the heat off other drug companies.
Most drug companies do not increase prices fiftyfold overnight, as Mr. Shkreli did.
But they often increase prices 10 percent or more a year, far faster than inflation. And those 10 percent increases — on drugs for common diseases like diabetes, high cholesterol and cancer — have a far bigger impact on health care spending than the 5,000 percent increase on Turing’s drug, Daraprim, which might be used by about 2,000 people a year facing possible brain damage from a parasitic infection called toxoplasmosis.
So you may ask, how much does this drug Opdivo (in combination with another drug, Yervoy) cost?
The cost of cancer treatments has drawn scrutiny from doctors such as Leonard Saltz of Memorial Sloan Kettering Cancer Center, who estimated earlier this year that the Opdivo-Yervoy combination would cost the average patient $295,000 for a little less than a year of treatment. If all advanced cancer patients in the U.S. received drugs at that estimated price, he projected, the total cost would reach $174 billion per year.
There are a number of very difficult ethical and practical considerations here. In addition to the astronomical cost is the knowledge that the drug will likely only extend life by a few months. According to the video, "half of the Opdivo patients were alive 9.2 months versus 6 months for chemotherapy". And on top of that, the proposed drug combination according to the article has a much higher toxicity rate.
Decisions on how or whether to use drugs like these can only be done by the specialist. But here is a drug being marketed directly to patients who are in a fight against end-stage cancer which really comes across as preying on their desperation. This is another (albeit an extreme) example of why it is unwise to have prescription drugs marketed directly to consumers. As another example of 'American Exceptionalism', America is the only country in the world (other than New Zealand) that allows this!
Presumably one of the rationales behind giving pharmaceutical companies a free reign on pricing is to be assured that there will be enough profits for research to find future drugs. But these companies spend far more on marketing than research.
In addition, the lack of a universal health insurance system in America creates a system with higher drug prices.
The US is an outlier among industrialized nations: it’s the only rich country that does not offer a publicly funded health system, relying instead largely on private insurance. This affects the pricing of drugs in several ways that are independent from the actual regulations imposed on pharmaceutical companies.
First, and perhaps most importantly, the power in setting the price for drugs is skewed toward drug manufacturers. Unlike countries where universal health coverage is in place, the negotiating is left to individual care providers rather than being in the hand of a large, publicly funded buyer that’s able to negotiate since it purchases most (if not all) of the drugs.
Just to add insult to injury, the US does have its own universal health coverage but only for those over 65 in the way of Medicare. But at Republican insistence, Medicare is barred from negotiating for lower drug prices!
So while the issue of drug pricing in the US is a complex one, there is much that can and should be done to improve the situation for Americans. Drug pricing has become an issue in the upcoming presidential election (at least for the Democratic candidates). It is up to us voters to make our voices heard on this issue!