One pharmaceutical CEO is driven by ethical and moral outrage -- and opportunity.
With prices on certain drugs skyrocketing overnight, it’s no wonder that some consumers and lawmakers are outraged. Now, it seems, the trend has also pushed one pharmaceutical company CEO into their camp.
When Turing Pharmaceuticals jacked up the price of Daraprim, a generic drug used primarily by cancer and AIDS patients, by a shocking 5,000 percent overnight, from $13.50 to $750 per pill, Imprimis Pharmaceuticals CEO Mark Baum decided enough was enough.
In an effort to provide patients with an affordable option to the $750 per pill Daraprim, Imprimis developed a compounded alternative to Daraprim that sells for $1 per pill.
“I reached an ethical and moral boiling point. I didn’t want to stand by any longer,” Baum, 43, explained in an interview with CNN Money.
Baum said the response to his company’s $1 Daraprim alternative has been overwhelming.
Turing is one of the four companies targeted by a recently launched U.S. Senate investigation into dramatic drug price increases.
Even by selling a low-cost alternative to Daraprim for $1 per pill, Imprimis is making a profit, Forbes reports. Turing CEO and former hedge fund manager Martin Shkreli maintains that his company can’t make a profit on Daraprim even if it sells it for its original $13.50 a pill.
Baum said the base chemical in Daraprim is incredibly inexpensive.
“[Shkreli’s] issue is not the cost of the drug or even the cost of the labor,” Baum explained to Forbes. “His issue is the cost of capital. He paid $55 million for that formulation. He’s gotta cover that cost. So, based on his input, he’s gotta sell it for a lot more than we do.”
As the CEO and a stakeholder in Imprimis, Baum is hardly an impartial observer to drug price hikes. But he maintains that he’ll continue to fight for affordable drugs because exorbitant hikes in prescription prices are not sustainable.
“I like to practice ethical capitalism. It’s good business to be empathetic towards customers. It makes financial sense in the long run to behave like this,” Baum said.
What do you think of Baum’s reaction to the Daraprim price hike? Share your comments below or on our Facebook page.