Mister S. Goes To Washington

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Shkrely   —   Gordon Gekko / Michael Doughlas   —    John Martin, CEO Gilead

Let’s just assume that Mr. Martin Shkrely had provided full testimony at the Congressional hearing, this is what it might have said: Read my lips: NO MORE REBATES !

It’s time to give Shkrely a break – he has been maligned too much. The media already made him into the new Gordon Gekko of “Wall Street”: the impersonification of corporate greed and a poster boy of narcisistic behavior. I think we can expect a movie version starring Mr. S. shortly, and it will be a blockbuster. He has the charisma, the chutzpah, the money; he portrays an aura of invincibility and behaves like an American cowboy in King Arthur’s court. All the ingredients of great entertainment. Remember, you read it here first.

Okay, okay – the guy is flamboyant and has the affluenza virus. He is a Wall Street product and knows how to irritate the bourgeoisie, the self-righteous, the Bernie Sanders followers, and all those who believe in playing by the rules. We can all agree on that. However, he may have gone too far by irritating those who love to hike up drug prices in a less conspicuous fashion and who hate to have the limelight cast on drug pricing. The public may ultimately benefit from his appalling lack of solidarity with industry behavior.

Daraprim (pyrimethoprim) is an old drug with few indications nowadays. In its hey days, it was used for malaria, and in the early AIDS days, it was a back-up drug for PCP, now called PJP. It is also still used for toxoplasmosis. Does this make it an “AIDS” drug? Is it a drug with a special status justifying a revolt in the HIV community when the price rises? By that wide definition, pretty much every antibiotic could be considered an “AIDS” drug.

PCP/PJP is fairly rare these days; it is seen infrequently and only in late stage HIV when the CD4 count falls below 200, eg, in non-responders to HAART. Most ID fellows never encounter a patient with PCP anymore; at the SFGH the number of cases has dropped by a factor of 10 compared to the pre-HAART era.

Clearly, with Turing (Mr.Shkrely’s company) charging USD 750 per pill, they are doing more than jacking up the price, they are breaking customary pricing standards. Only sofosbuvir / Sovaldi, a break-through HCV drug, comes close (it is in the $ 1000 / pill category). Antibiotics are usually sold at much lower prices; no antibiotics are among the top 10 most expensive medicines. This group comprises treatments for rare genetic diseases for which these drugs are truly life-saving. For a long time Zyvox (linezolid) was the most expensive antibacterial with a cost per pill around $150. You have to warn patients when you hand them a 7-day 7-pill prescription for Zyvox before they go to the pharmacy otherwise they get sticker-shock right there. Again, Zyvox was a true new MoA drug and deserved a premium price. Daraprim is not in this category.

Still, you could argue that Mr. Shkrely’s behavior is not so atypical after all. He is just imitating established pharma industry practices. Because of his antics, he has become the whipping boy for grandstanding politicians who want to set an example and show that the public outrage with drug pricing is being heard in Washington. But the action is – somewhere else.

Senators Grassley and Wyden just reviewed Gilead’s marketing documents dealing with Sovaldi and Harvoni pricing, drugs with a price tag of $85-94k per treatment course. Then they gave a press conference about their findings, complaining about unrestrained corporate greed [2]. There was no call for regulatory action, no congressional hearing is planned. Gilead’s revenue last year of USD 19 billion from Harvoni and Sovaldi alone tells the story [1]. It is highly unlikely that daraprim will create a similar windfall for Turing, far from it. Mr. Shkrely is being used as a lightning rod, diverting attention from where the really BIG money is made.

Alex Gorski, CEO of J&J, likes to say about the Ethical Pharma Industry that “Doing Well” is the reward for “Doing Good”. Mr. Shkrely couldn”t have said it better.

References:
[1] http://www.fiercepharma.com/story/gileads-hep-c-juggernaut-continues-q4-even-us-sales-fall/2016-02-02
[2] http://www.finance.senate.gov/ranking-members-news/wyden-grassley-sovaldi-investigation-finds-revenue-driven-pricing-strategy-behind-84-000-hepatitis-drug

Abbreviations
PCP / PJP   Pneumocystis carinii (jiroveci) pneumonia
SFGH   San Francisco General Hospital

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