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Ex-hedge funder buys rights to AIDS drug and raises price from $13.50 to $750 per pill

CocoLoco said:
This.

And I'm guessing he's banking on the gubmint getting involved and subsidizing the cost to patients. I would prefer the gubmint subsidize competition by paying another firm to produce it.
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If we're lucky the gubmint will slap some retroactive pricing regulations on his ass and fine the crap out of his company. But that's wishful thinking.
 
CoorsLight said:
20 years is barely enough as it is, though. The clock starts ticking on the patent years before commercial launch. A drug company is lucky to get 7 years in the market with patent protection.
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No true, or at least not that common. The key patents for the typical drug compound that receives an NDA typically have substantially more life left in them than seven years. And that's before considering patent extensions or exclusivity for things like Orphan drug status.

All moot in this case though, because the patient population is too small to attract any investment in a competitive compound.
 
This seems like a good example of an abusive monopoly? The only difference is the market in question is very small and narrow.
 
Archimedes said:
No true, or at least not that common. The key patents for the typical drug compound that receives an NDA typically have substantially more life left in them than seven years. And that's before considering patent extensions or exclusivity for things like Orphan drug status.

All moot in this case though, because the patient population is too small to attract any investment in a competitive compound.
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Hmmm, not to my knowledge, but I've never been involved in a commercial launch or orphan drugs.

Abacinator said:
If we're lucky the gubmint will slap some retroactive pricing regulations on his ass and fine the crap out of his company. But that's wishful thinking.
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Could be a slippery slope. While what has been done is unquestionably wrong, it's not illegal. Maybe the regulatory and legal conditions that make this situation a legitimate business opportunity need to be revisited.
 
CoorsLight said:
I don't think he has a patent. This compound can be a generic. It's just that the anti-parasitics market is so small and specialized, there is no other company that has made the investment to market a generic alternative.

His company just bought the rights and manufacturing line time from the one company that had the commercial version of the compound. It's quite apparent that this purchase was made with the intent to extort patients and healthcare providers. Even for a generic, it takes years for a company to get a product on the market. This guy knows he's got a couple of years to rob folks until another company decides to make a generic.
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Well to be fair, we don't know the details of the sale deal. The seller may have pushed the pricing into very high levels that demanded a significant increase in product pricing. We're not really sure who the "bad guy" is here, just the guy left without a chair when the music stops. Ultimately, all deals have to make sense for both parties.

I'd bet the seller took a large chunk out of the increase as did the new purchaser. These things tend to operate on an annuity type basis when HF's are involved.
 
Holeshot said:
Well to be fair, we don't know the details of the sale deal. The seller may have pushed the pricing into very high levels that demanded a significant increase in product pricing. We're not really sure who the "bad guy" is here, just the guy left without a chair when the music stops. Ultimately, all deals have to make sense for both parties.

I'd bet the seller took a large chunk out of the increase as did the new purchaser. These things tend to operate on an annuity type basis when HF's are involved.
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They paid $55 million for the drug, which had annual revenues of $5 million at the old pricing. The seller obviously got a premium that assumed a price increase, but not from $13.50 to $750.
 
CoorsLight said:
Hmmm, not to my knowledge, but I've never been involved in a commercial launch or orphan drugs.
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I've valued dozens of drugs over the last 20 years and I've never seen one that had less than 12-15 years of protection from the date of ANDA.
 
Archimedes said:
I've valued dozens of drugs over the last 20 years and I've never seen one that had less than 12-15 years of protection from the date of ANDA.
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In your experience, NDA to commercial launch is how long? PAI and approval is a year or a little more if you're really lucky.
 
Everywhere on Facebook (and the OP title) today I'm seeing headlines about the "AIDS drug" that has had its price jacked up by the rich jackass. While I'm pretty sure the jackass part is true, I find all of the manipulative headlines disturbing; media sites are spinning the truth to make the headlines more emotionally charged, trying to create some clickbait (I know, I know, big surprise).

This drug is not an AIDS treatment drug, but an anti-parasitic to combat toxoplasma infection. This infection, like any other, is more dangerous for those folks who are immunocompromised (e.g.those with HIV/AIDS), thus the importance of the drug for that population.

I'm not sure if I'm more annoyed by the rich jackass, the clickbait headlines, or the people who are reacting to the clickbait headlines. FYI many human toxoplasma infections come from contact with cat poop, so pregnant women and immunocompromised folks should not clean the litterbox! :afm199
 
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Lots to sift through here but I'm equally as pissed. He's very arrogant implying a 5000% hike is nothing to fret and doesnt understand why people are up in arms.

Also read that it's a goverment funder/created drug SO the increase in costs will be absorbed via tax payers. Not sure the truth on that.

Pic of the guy says it all. My niece can probably do more push up than him.

Typical unregulated hedge fun practices. They are vultures.
 
He definitely bought the company with the intention of hiking prices.

“When you bought this company did you buy it because you knew you could raise the price?” Sullivan asked.

“We definitely planned on raising the price, that’s for sure,” Shkreli admitted. “We’ve took it to a price where we can make a comfortable profit, but not any kind of ridiculous profit.”
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He feels he is doing nothing wrong because the drug is still "undervalued" compared to other drugs.

Noting that the pill sold for $13.50 and the course of treatment “to save your life was only a $1,000,” Shrkeli said he had to make a change.

“We know, these days, in modern pharmaceuticals, cancer drugs can cost $100,000 or more, whereas these drugs can cost a half of a million dollars,” he explained. “Daraprim is still under-priced relative to its peers.”
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All the internet out rage isn't going to change his mind.

Tirrell concluded by asking if Shkreli would consider lowering the price because “doctors and patient groups are saying they can’t access this drug.”

Shkreli responded with one word: “No.”
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Yup, this isn't the first time he does such operation.

In September 2014 Retrophin acquired the rights to thiola, a drug used to treat the rare disease cystinuria. It was with Shkreli as CEO that Retrophin introduced a 20-fold price increase for Thiola, despite no additional research and development costs incurred by obtaining these rights.[9][10]
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https://en.wikipedia.org/wiki/Martin_Shkreli
 
There is a very good reason by Greed is considered one of the worst of the 10 deadly sins.
 
Ah...muricah
Climber said:
There is a very good reason by Greed is considered one of the worst of the 10 deadly sins.
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I'll bite... I knew of 7 deadly sins; which are the other 3?
 
Dude is a pillar of the community


The news service also disclosed the Shkreli, who is a founder and managing partner of hedge fund MSMB Capital Management, has been involved in a criminal investigation into harassing a former employee. In a January 2014 affidavit for the case, the former employee, Timothy Pierotti, quoted from a letter sent to his wife by Shkreli, in which the then-CEO said: “I hope to see you and your four children homeless and will do whatever I can to assure this.”

- See more at: http://www.biospace.com/News/ex-ret...-urging-investors/356208#sthash.GyMGbmUZ.dpuf
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