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Health and Wellness

Big Pharma Puts a Price Gouge on Greed

Hedgefund buys the rights and bumps up the price to medication

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Big Pharma Puts a Price Gouge on Greed

Daraprim, the brand name for pyrimethamine, is used for fighting off malaria and toxoplasmosis infections patients with weakened immune systems, usually due to HIV and certain cancers, are susceptible to since the drug's creation over 60 years ago. Medical breakthroughs are not the reason for warranting the medication's recent appearances in news discussions. A drug that affects a comparably low population of Americans is making headlines for its prices being raised an astounding 5,000 percent.

Turing Pharmaceuticals, headed by former hedgefund manager Martin Shkreli, purchased the rights to Daraprim and, within the last week, has raised the price from $13.50 to $750, per pill. Only a few years ago, when another company held the patent, pills sold for only a dollar. Speaking with CBS's Don Dahler, Shkreli stated: "The drug was unprofitable at the former profit...any company selling it would be losing money and at this price it's a reasonable profit. Not excessive at all." Dahler pointed out that Daraprim users are "...a small, but vulnerable group of patients," asking Shkreil, "You see how greedy this looks?"

Shkreli's retort: "...there's a lot of altruistic properties to it."

Altruism, the concern of the well-being or welfare of our fellow man. Dahler cited, that along with the price per pill, annual Daraprim treatment ran up from $1,130 to $63,000. Staying true to the fiscal outrage, the Huffington Post cites the Infectious Disease Society of America and the HIV Medicine association in that: "...treatment for toxoplasmosis will now cost $336,000 for those who weight less than 132 pounds, and $634,000 for those who weigh more than that." Treatment usually goes on for a year, especially longer for patients left defenseless by their compromised health.

Turing bought Daraprim for $55 million after Shkreli received funding of $90 million from his investors.

ABC's Linsey Davis got her own chance to take a crack at Shkreli. The young entrepreneur shifts the outrage directed towards him into the public's "...fundamental misunderstanding of the way pharmaceutical companies operate." True, it comes off as no surprise Big Pharma has an ulterior motive in researching and developing their drugs: profit. Shkreli continues, "At this price Daraprim is not a substantially profitable drug."

In the previous source article, the Huffington Post approximated American Daraprim users to around 2,000 people; take into account the total US population, thanks to the Census Bureau, the quotient equals a single 161,000th of the entire United States. There was no necessary demand for the drug's price to be raised as the supply was relatively low, manufactured to aid the low percentage of Americans who fall victim to toxoplasmosis. Instinctively, there was a demand for Daraprim's use, according to the user's fighting off near fatal infections to survive. Economically, there was no justification for it.


Days after issuing the price gouge on Daraprim, Shkreli took a step back and eased his position on the matter of his drug. "We've agreed to lower the price of Daraprim, to a point that is more affordable...allows the company to make a profit...a very small profit," he told ABC. The supposed economist's attempt at being more considerate comes off as a clear public relations strategy. To NBC, Shkreli stated: "

"Yes it is absolutely a reaction — there were mistakes made with respect to helping people understand why we took this action, I think that it makes sense to lower the price in response to the anger that was felt by people."

The Infectious Disease Society of America commented: "...this cost is unjustifiable for the medically vulnerable patient population in need of this medication." Dr. Carlos del Rio told the Huffington Post: "It’s clearly the best drug. If I had toxo, I’d want to get Daraprim." The New York Times noted this incident of price gouging is not brought on by a shortage for Daraprim, but a "business strategy of buying old neglected drugs and turning them into high-priced 'specialty drugs.'" Lastly, Politifact quoted University of Iowa's health policy professor Amir Attaran, "No one needs a new drug for toxoplasmosis anyways. It works so well bloody well."

The rush to design a new drug with fewer side effects is not there. Daraprim has been prescribed since the 1950's by medical practitioners, the middlemen in the game played by the insurance companies. Since then, Daraprim has not needed to change. A hefty price tag slapped onto the drug is only incentive to drive up profits, not healthcare efficiency.

Shkreli's flaw in his design is his ambition. He asked for too much when there was nothing to be given to him. Which is why he has to settle, lowering his prices just to be decent. The dollar signs and numbers are just dividers between the people receiving treatment and those gaining off of it. One cannot put a price on human suffering, no matter how small the group of people. You should not have to.

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This article has not been reviewed by Odyssey HQ and solely reflects the ideas and opinions of the creator.
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