Following yesterday's piece 'Healthcare stinks because Washington is rotten', I received an email from Hugh - a regular reader of this blog and a guy who often sends me useful comments and pieces of information that are helpful in forming my analyses - I enjoy our correspondence.
The one below is a perfect example of the rot that infects Washington, all the ingredients are present:
1. The politicians on the take
2. The regulators on the take
3. The crony capitalists who feed them - creeps who give honest business people a bad name
4. The spineless 'elite' journalists who sit on the truth, either because they never had any integrity in the first place, or because they have become fat and lazy living off their address books
For what its worth, and it's worth nothing to these parasites - I hold them all in contempt.
Anyway - many thanks to Hugh - here he is:
"Just a note about one part of the messed-up US health business. I did a bit of research when the Shkreli incident hit the headlines. The drug that he price-gouged, Daraprim, has name-recognition for me. It was used as an anti-malarial prophylactic, available cheaply & OTC, when I was growing up in Africa in the 60s. So I knew it was cheap & easy to manufacture & likely out of patent. A quick check on Wikipedia shows a tablet is sold for $0.02 in parts of the world. Even in the UK a tablet costs $0.66. Shkreli was selling it for $750 per tablet.
So how was it possible for Shkreli to price-gouge an out-of-patent drug? According to Wikipedia:
In the United States, as of 2015, with Turing Pharmaceuticals' acquisition of the US marketing rights for Daraprim tablets, Daraprim has become a single-source and specialty pharmacy item, and the price of Daraprim has been increased. The cost of a monthly course for a person on 75 mg dose rose to about $75,000/month, or $750 per tablet. Outpatients can no longer obtain Daraprim from their community pharmacy, but only through a single dispensing pharmacy, Walgreens Specialty Pharmacy, and institutions can no longer order from their general wholesaler, but have to set up an account with the Daraprim Direct program. Presentations from Retrophin, a company formerly headed by Martin Shkreli, CEO of Turing, from which Turing acquired the rights to Daraprim, suggest that a closed distribution system could prevent generic competitors from legally obtaining the drugs for the bioequivalence studies required for FDA approval of a generic drug.
So the real issue is with the FDA. Why was there no outcry about this? The Shkreli incident was a perfect time to investigate something that's wrong with the system. This is just an example. It's happening with many out-of-patent drugs for which generics should be available. The other strange thing I found is that US doctors often prescribe the name-brand drug even when a generic is available & the insurance companies are fine with this. Why? Surely that's not in the interest of anyone except drug companies. Lastly, it seems the American consumer has been conditioned not to trust generics.