The political pressure on the drug industry’s pricing practices intensified this week with the Senate launching a formal investigation into four companies that have been under fire in recent months for hiking up the prices of their products.The Senate’s Special Committee on Aging, which is led by Sens. Susan Collins (R-Maine) and Claire McCaskill (D-Mo.), said the probe will include Turing Pharmaceuticals AG, Valeant Pharmaceuticals, Retrophin and Rodelis Therapeutics and seeks to understand the “causes, impacts, and potential solutions” related to the issue.
In September, Martin Shkreli, the 32-year-old former hedge fund manager who is CEO of Turing, became the face of the industry’s greed when he insisted on national television that the $750-a-pill price on the formerly $18-a-pill drug Daraprim – a more than 4000 percent increase – was justified and called a journalist a “moron” on Twitter for asking why.
The outcry also prompted scrutiny of other companies that had taken similar actions. Valeant, in the summer, quadrupled the price of its drug Cuprimine which treats an inherited disorder that can cause liver and nerve damage.
Retrophin, a public company where Shkreli served as an officer and director before being ousted, has been criticized for hiking the price of an old drug called Thiola more than 20-fold. The drug is used almost exclusively for patients suffering from cystinuria, a particularly nasty disease affecting the kidneys.
Separately, the United States Attorney’s Office for the Eastern District of New York is investigating Shkreli for his actions during his time there. The allegations are complex, and the details of the case haven’t been made public, but Newsweek has reported that “the inquiry, according to court records and people with knowledge of the inquiry, involves such a vast number of suspected crimes it is difficult to know where to start.”
In October, Rodelis Therapeutics, which specializes in a drug for a rare disease, found itself in the spotlight after its plans to raise the drug’s price more than 20-fold were revealed. Only a few weeks after purchasing the rights to the medicine, it agreed to return it to the nonprofit that previously had the rights.