In the world of healthcare, it's been a rough past week. With the full repeal of Obamacare without a replacement looming, the cost of healthcare in America will inevitably jump. If that's not enough to get you clutching your purse strings, then the mention of yet another pharmaceutical company hiking up the price of a needed drug will, especially if that price inflated 85,000% from its original price. Yes you read that right: 85,000%.
The drug is H.P. Athcar Gel, a product used to treat seizures and multiple sclerosis in babies and infants, most often in lifesaving cases. In 2001, one vile of the medication cost around $40, before the rights to manufacture it were purchased by a subsidiary of Mallinckrodt. Over the past decade and a half, the price of one vile of the medication has steadily increased from its original price of $40 to over $34,000. A lifesaving medication goes from being cheaper than the average person's phone bill to more expensive than most cars in the course of more than 15 years.
Mallinckrodt's subsidiary company not only raised the price of the lifesaving medication but also monopolized it in the process, furthering their power as a supplier over the needs of their consumers. In 2013, the subsidiary outbid competitors and bought Synacthem, a company producing a similar product to the H.P. Athcar Gel, thus giving Mallinckrodt full control over the market.
Thankfully the price hike, as obvious as it may seem, did not go unnoticed by the Federal Trade Commission, which charged the company with anti-competitive practices, ultimately settling for a $100 million fine, selling the company Synacthem, and allowing other companies to produce the drug. Although justice was served in the end, why did it take so long for the Federal Trade Commission to recognize the unjustified price hike of the medication, considering it's not the first of it's kind to happen in recent years.
Whether it's EpiPen, tuberculosis medications, or aids treatments, a growing trend of big pharmaceutical companies suddenly raising the price of their products overnight has spread like an infectious disease over the past few years. Why does it take so long for companies to be reprimanded for their price hikes? Why is a 100% increase enough to set off alarm bells? Granted there are inflation rates and fluctuation within the economy as well as the commodity prices of creating the drugs that affect the pharmaceutical manufacturing pricing, but hiking the price of a drug by 500% is more than just "adjusting for inflation."
