We Are All Pharma-Bro Suckers
"Pharma Bro" Martin Shkreli became one of the most notorious people in America for hiking the price of a rarely used life-saving drug by 4,000 percent in September of 2015.
And nearly a year later, dozens of reports are now coming out about how Mylan Pharmaceuticals hiked the price of the very common life-saving EpiPen by over 450% since Mylan bought EpiPen in 2007.
You've probably heard of EpiPens, and you probably know someone who needs to carry two around with them at all times, just in case they have a severe allergic reaction as a result of some everyday occurrence: for example, encountering a food product with peanuts or being stung by a bee.
ABC News reports that "The website Good Rx, … currently lists EpiPens as costing around $600 at multiple drug stores. In 2007, when Mylan Pharmaceuticals took over producing the drug from Merck, the cash price of the pens was about $50.".
And Bloomberg reports that the device only contains about $1 - ONE DOLLAR - worth of epinephrine.
But it's not the epinephrine that makes EpiPens unique, it’s the precision delivery system, the "Pen," that makes the product special.
And that delivery system really hasn't changed since 1977 when the EpiPen hit the market.
So why did the price jump up from $57 in 2007? Why are patients paying over $600 for two pens less than a decade later?
Because of the greed at Mylan Pharmaceuticals, plain and simple.
Cynthia Koons and Robert Langreth at Bloomberg wrote last year about "How Marketing Turned the EpiPen Into A Billion-Dollar Business."
The report details how Mylan bought EpiPen from Merck and then aggressively marketed the drug to concerned parents while increasing prices annually.
That strategy boosted the revenues from EpiPens by more than $1 BILLION, from $200 million in revenues in 2007, up to $1.2 BILLION in 2015.
That strategy worked so well for Mylan that by 2015, EpiPen represented 40% of Mylan's operating profits, according to ABR/Healthco estimates.
A report from NBC News shows that during that same period Mylan CEO Heather Bresch's total compensation increased from $2.5 million dollars to nearly $19 million dollars - a 671% increase!
The stock price also more than tripled from $13.29 in 2007 to $47.59 in 2015, and according to OpenSecrets, the company's lobbying efforts spiked from $270,000 to $1.2 million dollars in 2008, resulting in changes in FDA guidelines that directly benefited the company's bottom line - while patients still saw annual price increases.
That strategy of aggressive marketing, price hikes, and intense lobbying efforts also feeds the problem that Senator Bernie Sanders spotlighted on the campaign trail last year: Americans pay the highest prices for prescription drugs in the entire world, because the pharmaceutical companies take Americans for suckers.