A final rant about pharmaceutical companies

Sorry—I can’t stop ranting about drug companies. (Look at the Topics menu for more rants on the subject.) Lately, there’s been a brouhaha about the increase in the cost of a Daraprim, a 62-year-old infectious disease drug that was recently acquired by Turing Pharmaceuticals. Turing immediately raised the price from $13.50 a tablet to $750 a tablet. (The CEO, Martin Shkreli, was arrested December 19^th last year on securities fraud charges—essentially for a Ponzi-like scheme.)

Pharmaceutical companies want you to think their prices are high because they spend so much on research and development. That’s hogwash. Their prices are high because they’re trying to make the biggest profits they can get away with. Like Turing, their strategy is to buy companies and/or drugs, after which they jack up the drug prices. Here's another example: Valeant Pharmaceuticals International spends just 3 percent of sales on R and D, which they consider to be “inefficient” and “risky”. Valeant bought the rights to Isuprel, a heart medication, and immediately raised the price of 25 pills from $4,489 to $36,811. Similarly, 100 capsules of Cuprimine, a drug for Wilson’s disease, rose from $888 to $26,189. (In some foreign countries that same drug sells for $1.00 a capsule.) In all, Valeant has raised the prices of its brand-name drugs an average of 66 percent.

Executive pay, by the way, is tied to shareholder returns. Last year, Valeant spent $123 million on the five highest-paid executives. Its president, J. Michael Pearson has become a billionaire. Although Pearson operates out of an office in New Jersey, the company has relocated to Canada for its tax advantages. 

While their profits have generated wealth for shareholders, it’s not been so great for the employees who worked for the companies acquired by Valeant. Many, if not most, have lost their jobs. For example, after acquiring Bausch & Lomb, Valeant fired 3,000 of the original 4,103 workers. 

Valeant and Turing may be extreme examples, but I think many if not most of these companies are immoral, if not downright evil. For my part, I just say no to drugs. I’m glad I can do that.

Next week: Inflammation I: My accident

For an introduction to this blog, see I Just Say No; for a list of blog topics, click the Topics tab.