Pharma CEO Martin Shkreli is easy to hate, but that doesn’t mean he’s wrong.
Shkreli is infamous for jacking up the price of a 62-year-old drug by 5,000%, and then defending the move as the innevitable product of capitalism.
His company, Turing Pharmaceuticals, is small, and the drug, Daraprim, is rarely used. Nevertheless, the move grabbed national attention.
For months, Shkreli has been doing something the pharmaceutical industry at large has neglected to do: Exposing the critical need for balance between the interests of shareholders and patients.
Often that need plays out in the pricing of new, innovative drugs. This is why it shocked no one when the Senate recently released a report on how Gilead Sciences put its profits first when pricing its new hepatitis C cure at about $1,000 per pill, or $84,000 for a treatment.
The drug industry says there’s a big difference between Gilead’s drug and Daraprim: Gilead’s is a new development and the price reflects the innovation and risk that went into that, and encourages more of the same. Daraprim is a 62-year old drug that Turing acquired earlier this year.
When Shkreli speaks bluntly about the needs of shareholders, without the buzzwords and public relations scripts, he makes big pharma very uncomfortable.
Because he’s telling the truth.
“It’s a business; we’re supposed to make as much money as possible,” Shkreli said at the Forbes Healthcare Summit last week, where his attendance was the buzz of the conference.
If anything, he said, he would have raised the price of Daraprim higher.
After a lunch filled with healthcare leaders shaking their heads, muttering unkind words or sharing bewildered expressions over iced tea and baked fish, CEOs from some of the biggest drugmakers companies took to the stage to put as much distance between themselves and Shkreli as they could.
“He is not us,” Merck CEO Kenneth Frazier said, while GlaxoSmithKline CEO Andrew Witty called the Daraprim price hike “disturbing.”
Shkreli is the villain we need to get our healthcare system in action.
When Business Insider spoke to Shkreli back in October, he told us that one of his biggest priorities was being himself.
“Most of the drug CEOs I know, they’re not themselves — they’re what people want them to be,” he said at the time. “It’s pretty obvious of the different drug executives. They’re old white men, very buttoned up. They’re appropriate, so to speak. I’m a little bit more irreverent, and I’m not going to change just because I have this job.”
At the same conference where everyone’s feathers got ruffled by Shkreli’s comments, the theme of the day seemed to be about how the healthcare industry — not just pharmaceutical companies, but all parts — need to innovate and catch up to other industries that have made it so easy for consumers to have a transparent picture of how much they’re paying and what they’re getting into.
In other words, consumers deserve a better understanding of what goes into the price of the drug they are picking up at the pharmacy and why it’s so high, or entirely out of reach for some.
They also deserve to know why this is a uniquely American problem. GSK CEO Witty made the point at the conference that his company owns the global rights to Daraprim (they sold the US rights to the drug in 2009), and it’s sold at $20 a month in England.
It’s not unique to Daraprim, of course and there’s many factors. But a key one is that, unlike in England, the US government isn’t able to negotiate the price of drugs.
Shkreli is an easy scapegoat, and he seems to like playing the villain. When he punctuates his statements with that incredible eye roll of his, he surely gets under Big Pharma’s skin the way he does with many casual observers.
But we can’t write him off. He doesn’t exist in a vacuum. And he might be the spark that gets us talking about how we can fix the problem.
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