6 ms·

He raised the price of Daraprim for insurers, and allows patients to receive it for free if they can't afford it

by lionyo 10y ago

maxerickson 10y ago
Insurers get their money from premiums. Charging them more drives up medical costs for everyone.
- Arizhel 10y ago
  That's correct, which proves that the system is fundamentally broken.
  - zimpenfish 10y ago
    It might prove the system fundamentally broken but it does it at the expense of people's health and lives. Not a tradeoff I'd care to make, personally.
    - Arizhel 10y ago
      Sure, but why should anyone care about what you personally think or what tradeoff you'd make? Are you the CEO of a pharma company? Or a politician who has some power over the healthcare industry? No? Then you don't matter. The people who DO make these decisions think very differently from you. They're all part of the system, and the system is obviously fundamentally broken. Us sitting around and whining about sociopaths doing sociopathic things is not going to make them stop being sociopathic and making decisions that negatively affect peoples' health and lives.
  - maxerickson 10y ago
    It demonstrates a problem with the system, I'm not sure it is fundamental. There's lots of more widely used generic drugs that are available for a nominal fee.
  - rudolf0 10y ago
    Just because he's pointing out a flawed system doesn't mean he isn't exploiting it and personally profiting off of it as well.
    - Arizhel 10y ago
      We can sit around and whine about some guy exploiting a broken system, but that's not going to fix the problem. Everyone's focusing on one guy who exploited the system, while ignoring both tons of other people who exploited it just as much (and probably a lot more, as he pointed out on his website), as well as the brokenness of the system itself.
      - rudolf0 10y ago
        That's true, they should all be treated with the same amount of contempt. I think making this website is one of the few good things he's done in a while. Shkreli is somewhat unique in terms of how much of an attention hog and braggart he is, though. Plus his stock fraud and general asshole persona.
AbrahamParangi 10y ago
It's a zero sum game though. Raising the price of the drug literally just pulls money out of the system and puts it in his pocket at the expense of everyone else. It's easy to argue the action is parasitic and adds no value.
- BoorishBears 10y ago
  To me it seems like a tragedy of the commons, the issue is who will be first to stop extracting value this way. Since no one can be expected to, we need to fix the system that allows it, rather than expecting some altruistic behavior from outfits built to generate profit
  - inopinatus 10y ago
    There is no tragedy of the commons here. This is not a shared resource being depleted. The proper descriptor here is rent-seeking[1] and the Turing/Daraprim case lines up with Shiller's "river chain" analogy. [1] https://en.wikipedia.org/wiki/Rent-seeking https://en.wikipedia.org/wiki/Rent-seeking
    - BoorishBears 10y ago
      Again, this isn't anywhere near my wheelhouse, but I think of money the insurance companies allocate from premiums for drugs as being a shared resource that's being depleted. When the margins that insurance companies have set as targets are brushed up upon, premiums go up and we repeat the process again, except the premiums can't go up forever (right? I wonder if an expert on the subject could confirm) and the system will collapse
      - inopinatus 10y ago
        What you've described is definitely not a commons but a simple pricing outcome for a financial product. In a competitive market you'd expect that price to find an equilibrium, not to rise without bound. Notwithstanding which, this case exhibits none of those characteristics. It is rent-seeking, pure and simple.
filoleg 10y ago
Yes. And to people saying "well, but premiums will increase", the number of people who use Daraprim is so small, it won't affect insurance companies or premiums in any meaningful way whatsoever. And that's not even accounting that anyone who has no insurance can just get the drug for free.
- maxerickson 10y ago
  Dismiss enough $0.50 costs and your annual costs will go up in a meaningful way.
  - juliangoldsmith 10y ago
    Daraprim is used for the treatment of toxoplasmic encephalitis, which can happen when someone has both AIDS and toxoplasmosis. There were 39,513 AIDS patients in the United States in 2015. About 23% of Americans have toxoplasmosis, so that would be 9087 people who could get toxoplasmic encephalitis. Around 10% of people with toxoplasmosis develop toxoplasmic encephalitis [0], which would be 909 people who need Daraprim. A course of Daraprim costs $75,000. For 909 people, that would be a total of $68,175,000. Approximately 100M people in the United States have insurance, so that would raise your insurance cost by about $0.68. [0] 10.2% seroprevalence of toxoplasmosis, and 1.2% incidence of toxoplasmic encephalitis in the study at http://journals.sagepub.com/doi/pdf/10.1258/0956462053654230 http://journals.sagepub.com/doi/pdf/10.1258/0956462053654230

He raised the price of Daraprim for insurers, and allows patients to receive it for free if they can't afford it

by lionyo 10y ago

He raised the price of Daraprim for insurers, and allows patients to receive it for free if they can't afford it

maxerickson 10y ago

Insurers get their money from premiums. Charging them more drives up medical costs for everyone.

Arizhel 10y ago
That's correct, which proves that the system is fundamentally broken.
- zimpenfish 10y ago
  It might prove the system fundamentally broken but it does it at the expense of people's health and lives. Not a tradeoff I'd care to make, personally.
  - Arizhel 10y ago
    Sure, but why should anyone care about what you personally think or what tradeoff you'd make? Are you the CEO of a pharma company? Or a politician who has some power over the healthcare industry? No? Then you don't matter. The people who DO make these decisions think very differently from you. They're all part of the system, and the system is obviously fundamentally broken. Us sitting around and whining about sociopaths doing sociopathic things is not going to make them stop being sociopathic and making decisions that negatively affect peoples' health and lives.
- maxerickson 10y ago
  It demonstrates a problem with the system, I'm not sure it is fundamental. There's lots of more widely used generic drugs that are available for a nominal fee.
- rudolf0 10y ago
  Just because he's pointing out a flawed system doesn't mean he isn't exploiting it and personally profiting off of it as well.
  - Arizhel 10y ago
    We can sit around and whine about some guy exploiting a broken system, but that's not going to fix the problem. Everyone's focusing on one guy who exploited the system, while ignoring both tons of other people who exploited it just as much (and probably a lot more, as he pointed out on his website), as well as the brokenness of the system itself.
    - rudolf0 10y ago
      That's true, they should all be treated with the same amount of contempt. I think making this website is one of the few good things he's done in a while. Shkreli is somewhat unique in terms of how much of an attention hog and braggart he is, though. Plus his stock fraud and general asshole persona.

AbrahamParangi 10y ago

It's a zero sum game though. Raising the price of the drug literally just pulls money out of the system and puts it in his pocket at the expense of everyone else. It's easy to argue the action is parasitic and adds no value.

BoorishBears 10y ago
To me it seems like a tragedy of the commons, the issue is who will be first to stop extracting value this way. Since no one can be expected to, we need to fix the system that allows it, rather than expecting some altruistic behavior from outfits built to generate profit
- inopinatus 10y ago
  There is no tragedy of the commons here. This is not a shared resource being depleted. The proper descriptor here is rent-seeking[1] and the Turing/Daraprim case lines up with Shiller's "river chain" analogy. [1] https://en.wikipedia.org/wiki/Rent-seeking https://en.wikipedia.org/wiki/Rent-seeking
  - BoorishBears 10y ago
    Again, this isn't anywhere near my wheelhouse, but I think of money the insurance companies allocate from premiums for drugs as being a shared resource that's being depleted. When the margins that insurance companies have set as targets are brushed up upon, premiums go up and we repeat the process again, except the premiums can't go up forever (right? I wonder if an expert on the subject could confirm) and the system will collapse
    - inopinatus 10y ago
      What you've described is definitely not a commons but a simple pricing outcome for a financial product. In a competitive market you'd expect that price to find an equilibrium, not to rise without bound. Notwithstanding which, this case exhibits none of those characteristics. It is rent-seeking, pure and simple.

filoleg 10y ago

Yes. And to people saying "well, but premiums will increase", the number of people who use Daraprim is so small, it won't affect insurance companies or premiums in any meaningful way whatsoever. And that's not even accounting that anyone who has no insurance can just get the drug for free.

maxerickson 10y ago
Dismiss enough $0.50 costs and your annual costs will go up in a meaningful way.
- juliangoldsmith 10y ago
  Daraprim is used for the treatment of toxoplasmic encephalitis, which can happen when someone has both AIDS and toxoplasmosis. There were 39,513 AIDS patients in the United States in 2015. About 23% of Americans have toxoplasmosis, so that would be 9087 people who could get toxoplasmic encephalitis. Around 10% of people with toxoplasmosis develop toxoplasmic encephalitis [0], which would be 909 people who need Daraprim. A course of Daraprim costs $75,000. For 909 people, that would be a total of $68,175,000. Approximately 100M people in the United States have insurance, so that would raise your insurance cost by about $0.68. [0] 10.2% seroprevalence of toxoplasmosis, and 1.2% incidence of toxoplasmic encephalitis in the study at http://journals.sagepub.com/doi/pdf/10.1258/0956462053654230 http://journals.sagepub.com/doi/pdf/10.1258/0956462053654230