Move Over, Martin Shkreli. This CEO Says It’s His ‘Moral’ Imperative to Raise a Drug’s Price By 400 Percent - http://earlyretireonline.com | how to earn money fastSeptember 12, 2018 12:51 am
Categorised in: Breaking Financial News
Morals are slippery things.
We all claim to have them, but somehow we misplace them at the oddest of times.
We go to work, scheme against our colleagues, lie to the occasional customer and, during a coffee break, wail at the immorality of a politician or college football coach.
Some might mutter, though, that morals are like pornographic movies.
You know ’em when you see ’em.
My moral compass, therefore, enters a troubled magnetic field on hearing the words of Nostrum Laboratories CEO Nirmal Mulye.
You see, last month he raised the price of his company’s antibiotic Nitrofurantoin — it’s extremely helpful for bladder infections — from $474.75 to $2,392. That’s around 400 percent.
These things happen. Actually, they seem to happen quite a bit in the pharmaceutical world.
Is it really such a greedy business?
It seems not. Instead, it’s a business driven by moral imperatives.
Or, rather, former CEO.
Famed Wu-Tang Clan fan Shkreli seemed to relish his image as the “Pharma Bro,” someone who raised the price of a potentially life-saving drug by 5,000 percent and thought this was just good business.
Surely, though, Mulye wouldn’t hold up Shkreli as an effigy of moral rectitude.
Well now. Mulye did offer these words:
I agree with Martin Shkreli that when he raised the price of his drug he was within his rights because he had to reward his shareholders.
Would those be moral rights?
Mulye’s logic is that, in his company’s case, a competitor had raised its price for the equivalent — but branded — drug by enormous amounts over the last three years.
Now it stood at $2,800.
So look, Nostrum’s generic one is $408 cheaper. One could almost describe it as a bargain.
A moral bargain, perhaps.
I contacted Mulye to ask if he felt any moral responsibility toward those who need his company’s drug. I will update, should I hear.
I fear, though, Mulye needs to polish up his analogies. He compared his decision to raise the price to an art dealer who hikes the price of a painting to half a billion dollars.
Another example of his analogical bent:
We have to make money when we can. The price of iPhones goes up, the price of cars goes up, hotel rooms are very expensive.
I’m not sure whether this is a general description of economic realities or an expression of Mulye’s personal need to pay for these particular things.
Oh, I’m sure Mulye’s move is just another day in the life of the pharmaceutical industry, peppered as it is with dubious types and mired as it is in a system that somehow believes the profit motive and keeping people healthy are compatible.
Indeed, Mulye had no kind words for the Federal Drug Adminstration.
The FDA’s commissioner Scott Gottlieb suggested the feelings were mutual.
1/2 Regarding @FT story today @bydavidcrow; there’s no moral imperative to price gouge and take advantage of patients. FDA will continue to promote competition so speculators and those with no regard to public health consequences can’t take advantage of patients who need medicine
— Scott Gottlieb, M.D. (@SGottliebFDA) September 11, 2018
Gottlieb also noted that the drug isn’t in short supply.
I’m very concerned with Mulye’s lurch into a moral defense.
When CEOs invoke morality, you hope it’s got something to do with the basic human condition, rather than the joy of gouging the weak.
When a pharmaceutical company CEO speaks of morality, I fear many believe he might deserve a punitive conviction.