Lately the Internet’s been abuzz about Martin Shkreli, an unrepentant capitalist who raised the price of Daraprim from $13.50 to $750 per tablet.
Daraprim is a toxoplasmosis medication, a disease caused by a virus many of us have but few are affected by. Those who need the medication have compromised immune systems, such as AIDS and cancer patients.
People are aghast someone would actually raise a price like that, particularly against a group of sick and dying individuals. I don’t know if this is true, but I read the average prescription was hundreds of tablets, and if so, that means a typical prescription costs hundreds of thousands of dollars.
But something I kept missing in my reading about this is how it doesn’t affect people directly. Yes, in a sense it effects everyone, but Martin Shkreli’s primarily targeting insurance companies with this move.
For the insured, once you spend a few thousand dollars and meet your annual copay maximum, your insurance company pays all further medical expenses covered by your plan. And thanks to the Affordable Care Act, HIV/AIDS and cancer are covered by Medicaid for even more homeless and low income residents of the United States. The Affordable Care Act wasn’t perfect, but it was a step in the right direction.
So those who need this medication aren’t paying a cent. Instead what’s happening is everyone’s insurance plans will be slightly pricier next year, assuming you pay your own insurance and don’t get all or some through your employer or the government.
There are many issues with what Martin Shkreli did, but he primarily did it because there are no supply competitors within the United States. He certainly knows it will take years for competitors to get through FDA testing. He has his monopoly, and now he’s taxing everyone, primarily insurance companies, your employer, and the government.
Patients could certainly purchase the drug from other countries for cents per tablet, but those expenses won’t be covered by insurance plans, and I’m sure self-medication can be grounds for insurance termination.
The biggest problem, though, isn’t that Martin Shkreli did this. He could have doubled the price from $13.50 to $27 per tablet and no one would have noticed. The biggest problem is that America allows this, and that a lot of people have no interest in changing it.