Former Hedge Fund Manager Buys Rights To Drug For Pregnant Women, Increases Price 5500 Percent
by TARA CULP-RESSLER –
A decades-old drug that’s used to treat a common parasite has jumped in price by more than $700, after a pharmaceutical company purchased it and raised the price tag practically overnight — triggering protests from members of the medical community, who say that the treatment may now be out of reach even for patients with insurance coverage.
Daraprim helps treat toxoplasmosis, a parasite that mainly affects pregnant women and other people with compromised immune systems. According to the Centers for Disease Control and Prevention, toxoplasmosis is “a leading cause of death attributed to foodborne illness in the United States,” though it’s typically not dangerous for healthy people.
A start-up company named Turing Pharmaceuticals bought Derapim last month and now has exclusive rights to market the name brand drug, which has been on the market since 1953. Turing, which is run by a former hedge fund manager named Martin Shkreli, quickly upped the drug’s price from $13.50 per pill to $750 per pill.
“This is a tremendous increase,” Judith Aberg, a spokesperson for the HIV Medicine Association,told USA Today. She pointed out that patients could now struggle to afford Derapim even if they already have health coverage; because of the way that insurers currently classify drugs, patients are often left on the hook for 20 percent of a medication’s out-of-pocket cost.
“Every week, I’m learning about another drug that has increased in price because of a change in marketing or the distributor,” Aberg added.
Indeed, the news about Daraprim comes at a time when there’s increasing public scrutiny on the price tags for medication. As drug costs have been steadily rising, studies have found that more Americans are cutting back in other areas because they’re having a hard time paying for their prescriptions. Prices for generic, HIV, and Hepatitis C medication have all landed in the spotlight as consumer advocates argue the current system is untenable.
Last week, the Center for American Progress released a new report suggesting several policy changes to address the issue (disclosure: ThinkProgress is an editorially independent site housed at the Center for American Progress). The proposed policies include requiring pharmaceutical companies to disclose how much they’re spending on research and development — versus how much they’re spending on marketing — and creating a new public rating system to allow patients to easily compare drugs.
The high cost of prescription drugs is shaping up to be an issue in the 2016 presidential election. Democratic candidates Hillary Clinton and Bernie Sanders have both criticized the rising price of medication. Sanders linked to the most recent news about Daraprim on his campaign website, along with a link to his plan to lower drug costs, and Clinton used the story as a hook to announce that she’ll release a plan of her own this week.
For now, major medical associations are hoping that public pressure might convince Turing to reconsider its pricing. “This cost is unjustifiable for the medically vulnerable patient population in need of this medication and unsustainable for the health care system,” the Infectious Diseases Society of America (IDSA) and the HIV Medicine Association (HIVMA) wrote in an open letter to the company this week.