BioRegnum: The mob is back. And what's to stop them from going after the entire biopharma industry?
Mylan today is at the center of the latest online maelstrom to erupt over drug pricing and access to therapies. And while it hunkers down to see if it can wait out the storm that has erupted over the EpiPen, the one man who can do it the most damage is riding to its rescue.
Enter Martin Shkreli, former biotech CEO and the most widely hated individual in biopharma history. Shkreli specialized in taunting the digital lynch mob that formed after he raised the price of an ancient drug called daraprim by more than 5000% after snatching it up for a song. And he kept the crowd stirred by reneging on a promise to roll back the price.
The Shkreli defense — relax, insurance can pay for most of it — won’t fly. But that didn’t stop him from rolling it back out anyway.
“Mylan’s a good guy,” Shkreli told CBS. “They have one product where they’re finally starting to make a little bit of money and everyone’s going crazy over it….That’s up to insurance to pay for them,” he replied to a question. “It’s $300 a pen. $300. My iPhone is $700…. It’s $300 and 90% of Americans are insured.”
This is something like having a serial killer appear as a character witness at your murder trial.
Mylan got into this position by following the same strategy as Shkreli, buying an old product and jacking up the price, but followed a less risky approach by taking some time to do it. It blew up into a scandal in any case. And now the company is taking the place of Valeant, which followed the same approach and got shredded by the fallout.
Mylan, Valeant and the rest of Big Pharma routinely engaged in price gouging for the simple reason that they can. No law exists that prevents it. But hoping that the mob won’t suddenly appear at its door — along with Shkreli — isn’t a viable strategy any more.
Biopharma needs to swear off this addiction to price gouging and engage in some rollbacks, starting with Mylan. Companies can publicly state that they’re opposed to it and will stop the practice, because it is unethical. And if they don’t take the pledge, they can bear the consequences. Otherwise, everyone can face off against the growing clamor for drug pricing reform in Congress.
This is an industry crisis. And the industry needs to respond. This whole pricing structure for drugs is unsustainable in the US. It’s nice to experiment with new approaches like paying for the right outcomes, but change has to happen now. The alternative is to face controls on pricing for new and important drugs, where companies have a very good argument for charging some very high rates.
Something’s got to give.