Company that raised AIDS drug price by 5500% ‘under investigation’
The New York Attorney General has launched an investigation into a company that raised the price of an AIDS drug by 5500%.
Martin Shkreli, the 32-year-old founder and chief executive of Turing Pharmaceuticals, came under fire last month after buying the rights to 62-year-old drug Daraprim.
The drug costs less than $1 per tablet to make, and is used to treat conditions including AIDS-related toxoplasmosis.
However, Shkreli last month attempted to dramatically increaser the price of the drug from $13.50 per tablet to $750 – an increase of 5500%.
He later publicly pledged “to lower the price of Daraprim to a point that is more affordable” – though the drug has since remained at the high price point.
New York’s attorney general this week launched a probe into Turing Pharmaceuticals over the move, which may have violated the law.
Attorney General Eric Schneiderman is investigating whether the company broke antitrust rules, by attempting to hamper competition from generic competitor drugs.
The New York Times reports that a letter says: “While competition might ordinarily be expected to deter such a massive price increase, it appears that Turing may have taken steps to prevent that competition from arising.”
As Daraprim is 62 years old, it is not protected by patents and can be freely made by competitors – but given the small market, generic drug makers have not deemed it necessary until now.
In a free market, the dramatic price hike from Turing would be expected to see a generic competitor emerge – but the drug was removed from wholesalers and retails stores.
The New York Times notes: “Such restricted distribution can make it more difficult for generics manufacturers to get the samples of a brand-name product they need to do the required testing to show that their generic copy is equivalent to the original.”