People are outraged that a former hedge fund hack raised the price of a 62 year old drug that costs about a dollar to manufacture, from $13,50 to $750/pill. He has now relented and will “decrease” the price–to an undisclosed cost. Imagine that, arbitrarily pricing a drug to maximize profit? Actually that is nothing new in the era of $100,000-$200,000/year for new drugs.
It’s difficult to conceive of a drug costing more than a luxury auto (a BMW or Mercedes for example) or perhaps over a few years more than the cost of an average person’s home or even a multiple of the average yearly incomes of families. But that’s what has happened in the U.S. We have created a pricing monster that’s arbitrary and that’s bankrupting individuals and the system.
Medicynical Note: This hedge fund refugee is not unique. Drug company pricing is simply what they sense the market will bear. Some of that is market economics but other aspects are the seriousness of the illness and the desperation of the patient. It’s your money or you life.
But at it’s heart we’re simple getting grifted by good ole capitalism. Remember the goal of every capitalist no matter what they say about competition, is to eliminate it and have a monopoly. That’s nirvana. In pharmaceuticals this goal is facilitated by our patent law, aggressive often deceptive marketing practices and the need for safe drugs.
Big Pharma has been pricing arbitrarily without regard for cost or value for years. This clown simply said look here! the emperor has no clothes. Gouge when you can.
Our drug costs have predictably spiraled. As to what would be a fair price for a drug costing $1 to manufacture and which has long established indications? I’d say under $5. But don’t bet on that!