Piggish Pharmas Give Free Markets a Bad Name

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The notebook computer I use while ‘resting’ is acting up: I cannot grab the URLs I needed to source this story. However since they consist of two Wikipedia links, one on the miscreant’s name and the other on the drug he is using to rob the world…those links are easy to find.
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The many regulatory agencies within the permanent federal bureaucracy are past their sell-by date if they continue to refuse to rein in the robber barons in Big Pharma.

Here’s the latest one, a thirty-two year-old evil force. The FBI got him the same way they used to grab organized crime mobsters, that is, by finding something he’d done wrong in other areas and arrest him for that. Just for starters.

Thus, Mr. Shkreli has been arrested, charged,appeared before the judge and posted the five million dollar bail required to get out of jail until his trial.

Martin Shkreli (born April 1, 1983) is an American entrepreneur and financial and pharmaceutical executive. He is co-founder of the hedge fund MSMB Capital Management, co-founder and former chief executive officer (CEO) of the biotechnology firm Retrophin LLC and founder and CEO of Turing Pharmaceuticals AG. In September 2015, Shkreli received widespread criticism when Turing obtained the manufacturing license for Daraprim and raised its price by 5,500 percent (from $13.50 to $750 per tablet).

On December 17, 2015, Shkreli was arrested by the Federal Bureau of Investigation on charges of securities fraud.

Here’s a snip from the wiki on Daraprim:

Pyrimethamine (trade name Daraprim) is a medication used for protozoal infections. It is commonly used as an antimalarial drug (for both treatment and prevention of malaria), and to treat Toxoplasma gondii infections, particularly when combined with the sulfonamide antibiotic sulfadiazine when treating HIV-positive individuals.

It is on the World Health Organization’s List of Essential Medicines, the most important medications needed in a basic health system.

The wiki on this criminal says he’s an Albanian-American:

As of 2008, Shkreli served as the Chairman of the board of directors of the National Albanian American Council, a nonprofit organization that advocates for Albanians and promotes peace and economic development for human rights in the Balkans. Shkreli continues in this role as of 2014.

Price-gouging by Pig Pharma greed has no justification, and anyone who buys stock in such companies – or more likely, their 401-K investment groups buy in – ought to be held to account. Their excuse – his words for this move – is that his stockholders think he didn’t charge enough and anyway the patient is only responsible for a small co-pay. In other words, they stick it to the insurance companies.

Before you claim your government’s socialist health care doesn’t do this, check it out. Either your government health care simply opts out of purchasing what the UN has called an “essential drug” and you’ll have to pay full price at a chemists’ shop, first finding a doctor who’ll write a prescription. There’s no room for moralizing on this one because if you need the drug and you can get it on the cheap, you may be certain someone is paying for it instead of you – most likely other taxpayers. In addition, someone else – many, many someone elses – are going without due to the obscene raise in price.

Like all the other greedy mega corporations, they pay the politicians so they can continue to rob the rest of us.

Disgusting? Yeah: in every single direction you can name. If you wonder why Donald Trump is soaring in popularity, it’s because of our broken system. I won’t even mention the huge, unpayable debt raise our feckless crony capitalist politicians just laid on the backs of the unborn.

16 thoughts on “Piggish Pharmas Give Free Markets a Bad Name”

  1. What’s broken about the system is the artificial government-imposed monopoly misleadingly characterized as ‘intellectual property’. There is no such thing as ‘intellectual property’. Property is something that, when I have it, you can’t have it. If both you and I can have the same thing at the same time, it’s not property, because exclusivity is of the essence of the concept.

    In this case, there is a medical compound that anyone who had the necessary equipment and knowledge could make, but the government has decided that it will only allow one entity to determine who gets to make it. When, in cases like this, that works an obvious injustice, the temptation is to use the political process to invade the fake property right that government originally invented, which solves the problem but encourages government to invade other *true* property rights for the same ‘social welfare’ reasons.

    Government creates a monopoly and calls it a species of ‘property’, that works harm, popular pressure is brought to bear to fix the harm, government uses that as justification to invade the ‘property’ right, everybody’s happy, and then on down the road government says ‘Hey, we got away with invading that property right, let’s go ahead and invade other property rights using the same justification’, and off we go down the road to All Property Belongs To The Government Except That Which They Graciously Allow You To Use For The Time Being.

  2. Is there any truth in the story that this, er, gentleman’s lawyer has multiplied his fees for acting for him from his usual $1200 per hour to $60,000?

    • He’d have to raise his fees into the millions for it to make any difference to this creep. He just paid his $5,000,000.00 bail

  3. The best defense against Big Pharma is to live a healthy lifestyle and get informed about nutritional and herbal therapies, which can often be as effective or more effective than chemical drugs from a lab, with fewer side effects.
    If you don’t give them any money, they can run all the Ponzi schemes and billion-dollar frauds they want, without you……

    • In most cases that is true. This is a drug for, among other things, malaria. That’s why the UN considers it essential. Instead of using low-level DDT eradication like they did throughout the South in the 50s. I remember running behind those trucks in the evening as they sprayed…but now that we’ve eradicated ours, Africa, et al, will just have to get more of Bill Gates’ mosquito netting

    • Being healthy, what suggestions do you have for herbal therapies for my Type One diabetic son? Without insulin he dies. He is 6’3″ and when they finally tested his blood sugar, it was 600. He weighed 139 pounds and was starving to death as his body consumed itself. The endocrinologist said his beta cells died off – ALL of them – probably within the course of a week and perhaps from a virus.

      Insulin ought to be dirt cheap but it’s not.

      • Type 1 is evil, poor kid.
        Here’s some books I have found extremely useful:
        Prescription for Nutritional Healing by Phyllis A. Balch
        The Green Pharmacy by James A. Duke
        The Green Pharmacy Herbal Handbook (same author)
        Herbal Antibiotics by Stephen H. Buhner

        Keep in mind that I’m not a doctor, you should definitely clear anything you give your son with his physician. Hopefully, he has a doctor who isn’t completely chained to the kickbacks he gets from the drug companies and open to traditional (‘alternative’) treatments.
        I’ve heard of Astragalus, Cinnamon and Nopal (cactus) in connection with diabetes, asking in a Chinese pharmacy couldn’t hurt, either.
        Good luck!

  4. From your comments it appears that drug-pushers are all the same. Some do business with prescription drugs, others do business with non-prescription drugs. Both seek to get the best price they can for what they sell as the addict has a limited life span.

    • Not all drugs are addictive. Let’s use a scalpel here rather than a sledge hammer. For example, I make elderberry syrup for a relative with a chronic inflammation of his throat. Not addictive.

      I use Flonase for my nasal allergies but limit it: not because of addiction but because of the phenomenon of rebound problems with over-use.

      Once all they had for asthma was laudnam. Though addicting, it was better than dying.

      With medicines of all sorts the keys are education and discernment.

  5. Yes, Big Pharma is not particularly ethical nor moral.

    But I have very real doubts about the cynical media-driven efforts to stage a 5-minute hate.

    The reporting on his company was abysmal. No mention of rates of return, debt structure, and the other factors that influence prices.

    Is it possible to get such a level of journalistic incompetence without management directives?

  6. If I remember correctly, similar price-gouging was going on in the past with AIDS medicines, and they were unaffordable in poor countries.

    Then the Indian government decided to give the world the finger and allow the manufacture of generics of these medicines, patents be damned. The eventual compromise of sorts is that these have been allowed for use in poor countries.

    Now, lower-mid income countries such as Botswana are able to afford government-funded anti-AIDS drugs for everyone, and life expectancy there has been going up, the number of babies born with AIDS down, and they’re generally making serious progress against the disease.

    If I were running North Korea, I’d get out of the business of making drugs of abuse like crystal meth and into malaria medicines and similar, and sell them out the back doors of the consulates of their disgusting outfit, for greater profit and at least some public good. I’d find them slightly less disgusting as a result.

  7. You have absolutely no idea about what you have just written. Big Pharma spends billions digging dry holes before it comes up with a gusher. Do some homework please.

    • I have indeed done my homework, and done it for years now.

      You obviously have zero knowledge on the development of this drug, who created it, who developed it, and how it has been sold down the line. The current owner is a hedge fund manager who spent zero on any research and development. He bought the rights to the drug and then jacked up the price. As I said in my post, they arrested him for fraud. That is why I compared his arrest to the ones they used to make against organized crime. Often the mobs covered their tracks so well they couldn’t be gotten at for their strong-arm murderous practices, so they’d be gotten at via their tax dodges.

      This man is no different. They can’t get him for price-gouging – which is the basis of his real criminal activity – so they built their case around his Ponzi schemes.

      You, sir, badly need to do your own homework into what this industry has become.

      http://www.bloomberg.com/features/2015-martin-shkreli-securities-fraud/

      Martin Shkreli, a boastful pharmaceutical executive who came under withering criticism for price gouging vital drugs, denied securities fraud charges on Thursday following an early morning arrest, and was freed on a $5 million bond.

      While the 32-year-old has earned a rare level of infamy for his brazenness in business and his personal life, what he was charged with had nothing to do with skyrocketing drug prices. He is accused of repeatedly losing money for investors and lying to them about it, illegally taking assets from one of his companies to pay off debtors in another.

      “Shkreli essentially ran his company like a Ponzi scheme where he used each subsequent company to pay off defrauded investors from the prior company,” Brooklyn U.S. Attorney Robert Capers said at a press conference.

      Agents of the Federal Bureau of Investigation arrested Shkreli at his Midtown Manhattan apartment at about 6:30 a.m. and forced him to walk through a gaggle of photographers outside FBI headquarters.

      Evan Greebel, a New York lawyer, who is alleged in the federal indictment to have helped Shkreli in his schemes, was also arrested and charged. Like Shkreli, he pleaded not guilty, and he was freed on a $1 million bond. Both men and their lawyers declined to comment after their court appearance.

      A spokeswoman for Katten Muchin Rosenman LLP where Greebel worked during the time in question, declined comment. A spokeswoman for Kaye Scholer where he works now, said the firm has launched an internal investigation.

      Read the full text of the indictment here [link is at the original URL, above – D]

      In the federal indictment and a complaint by the Securities and Exchange Commission, authorities say Shkreli began losing money and lying to investors from the time he began managing money. In his mid-20s, he got nine investors to place $3 million with him and at one point he had only $331.

      Securities fraud is hardly unheard of on Wall Street and the amounts involved here are nowhere near on the scale of Bernie Madoff. But Shkreli’s case has drawn such attention because of his defiant price-gouging and his own up-by-the-bootstraps history.

      The son of immigrants from Albania and Croatia who did janitorial work and raised him and his brothers in working-class Brooklyn, Shkreli seemed at first to embody the American dream and then to mock it. After dropping out of an elite Manhattan high school, he worked as an intern for Jim Cramer’s hedge fund as a 17-year-old and quickly impressed with his ability to call stocks. He created hedge funds, taught himself biology and, after earning a BA at Baruch College in New York City, began hedge funds investing in biotech.

      He became famous within a certain world but entered public consciousness after he raised the price more than 55-fold for Daraprim in September from $13.50 per pill to $750. It is the preferred treatment for a parasitic condition known as toxoplasmosis, which can be deadly for unborn babies and patients with compromised immune systems including those with HIV or cancer. His company, Turing Pharmaceuticals AG, bought the drug, moved it to a closed distribution system and instantly drove the price into the stratosphere.

      He drew shocked rebukes from Congress, doctors and presidential candidates, and brought public attention to the rising prices of older drugs. Donald Trump called Shkreli a “spoiled brat,” and the BBC dubbed him the “most hated man in America.” Bernie Sanders, the Democratic presidential candidate, rejected a $2,700 campaign donation from him, directing it to an HIV clinic. A spokesman said the campaign would not keep money “from this poster boy for drug company greed.”

      Cephalon is another greedy member of Big Pharma. Here is a very small piece of its decades of obscene behavior:

      http://www.forbes.com/sites/matthewherper/2015/05/28/with-a-1-2-billion-hammer-the-ftc-closes-loophole-to-prevent-generic-drugs/

      …Teva Pharmaceuticals will pay $1.2 billion to reimburse insurers, drug wholesalers, and pharmacies who paid full price for the Provigil, produced by Cephalon, a company Teva bought in 2011, because Cephalon had paid generic drugmakers to delay launching cheaper versions of the blockbuster drug.

      That comes after a $512 million settlement Teva reached with plaintiffs who said they’d been forced to overpay for Provigil as a result, and a second settlement, the value of which is undisclosed. Some of that money will be credited to the new amount.* By point of comparison, Teva spent $6.8 billion to purchase Cephalon in 2011, so these settlements effectively increase the cost of the deal by 18%. Petach Tikva, Israel-based Teva, the world’s largest generic drugmaker, will also enter into a legally binding agreement with the U.S. government that will prevent it from making agreements that the FTC deems anticompetitive.

      “This is the largest settlement in FTC history for this type of case,” said Edith Ramirez, the FTC’s Chairwoman. “That’s a big sum and I think that will send a very strong signal to any company that is contemplating entering into any type of deal that is anticompetitive.”

      The size of the penalty is probably big enough to make drug makers think twice about crafting deals that delay generics. It also should help clarify the convoluted process through which drugs go generic in the U.S. It builds on a Supreme Court ruling against Actavis that opened the door for the FTC to bring such cases.

      Companies like these will destroy the free-market system. Not satisfied with re-couping the costs of R&D ten times over, they stiff-armed the generic manufacturers and annually paid hundreds of millions in fines to keep Provigil its private property long past the date the laws allowed. These greedy people are cut from the same cloth as the banksters, etc. Crony capitalists, paying off doctors, Congressmen, insurance companies, and foreign governments in order to keep the scam going.

      Not all pharmacy companies are like Cephalon. But enough are that they’re endangering the system which created the environment making their work possible. Competition is the life-blood of free-market capitalism. Anti-competitive criminal behavior deserves to be penalized to the extent that it is no longer profitable to be an outlaw. Period.

    • The Albanian mafia runs the black market tobacco “industry” all along the East Coast. Every time an economically ignorant state legislature in the Northeast decides tobacco taxes are low-hanging fruit and jack up the tax bite yet again for a pack of cigarettes, the 18 wheeler trucks full of cartons of lightly-taxed cigarettes marketed in the South begin their lucrative trip up to NY and Connecticut to sell their product at 20% of the cost of tobacco sold via the regular market.

      In California the Albanian mafia made a killing on thousands of those “unaccompanied children” recruited by Obama from Central America. They were brought here, held in “asylum” centers where many quickly escaped – right into the arms of the sex slavers. When they are finally used up and tossed away, our cities will be full of feral adults incapable of ever living normal lives after their captivity.

  9. Really? Businesses whose whole business model, even when it is not being abused, depends on government-granted monopolies give free markets a bad name? Anti-capitalist propagandists who blame the abuse of government-granted monopolies on free markets (which are the antithesis of government-granted monopolies) give the free market a bad name. Big Pharma gives government-granted monopolies a bad name and liars transfer that bad name to the free market.

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