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If he wasn't famous before this week, Turing CEO Martin Shkreli is certainly infamous now. Shkreli caught the wrath of the Internet and AIDS and cancer patients when his company, Turing Pharmaceuticals, jacked up the price for a life-saving medication about 5,000 percent.
While reports now suggest Shkreli has reversed course and will lower the price of Daraprim, the price hike left many wondering whether there are regulations in place to ensure the affordability of essential medication. Sadly, many drug price controls don't exist yet.
Antitrust, Not Necessarily Anti-Price Inflation
There are some antitrust laws that can affect drug pricing, but they generally apply to collusion between drug manufacturers and suppliers. For instance, a federal court recently struck down an agreement between two pharmaceutical firms that would've delayed the sale of a generic drug, meaning the price for the name-brand drug would've stayed higher.
Antitrust laws are designed to foster competition between companies, in the hope that prices won't be artificially inflated and therefore protecting consumers by ensuring fair and reasonable prices. Unfortunately, antitrust laws are only designed to prevent illegal price fixing agreements between two or more companies; they can't address what one pharmaceutical company decides to charge for its drugs.
Turing a Blind Eye to Price Gouging
The issue exploded when Turing took the price of pyrimethamine from $13.50 per tablet to $750 per tablet. Turing could do this because it purchased the rights to Daraprim, which contains pyrimethamine. Though the drug is 62-years-old, Shkreli's company has exclusive rights to its production and sale.
Pyrimethamine is an important component in battling toxoplasmosis, which can occur in patients with weakened immune systems. With the price hike, it could cost a person over $600,000 a year, just for the pyrimethamine component alone. (It should be noted that Shkreli is not just a price-gouger, but also a stalker and fighter of people on the Internet.)
So is there any way to rein in pharmaceutical companies like Turing and CEOs like Shkreli? Maybe not yet, but some politicians are looking to tighten controls on research and price and loosen restrictions on generic drugs. That can't happen soon enough for patients whose lives depend on these drugs.