Currently, 59% of the 36.9 million people across the globe diagnosed with HIV are taking targeted prescription drugs to treat their illness ("Global HIV and AIDS Statistics"). One of these drugs is Daraprim, which is used to treat malaria and prevent parasitic infections in AIDS patients (Smith, L.). In 2015, Turing Pharmaceuticals raised the price of Daraprim from $13.50 to $750 after purchasing its U.S. distribution rights from CorePharma, representing a 5000% increase in price per unit (Smith, L.).
The decision was met with public outrage, and the CEO of Turing Pharmaceuticals, Martin Shkreli, was denounced as "the most hated man in America" (Sidahmed). In 2016, Turing Pharmaceuticals reduced the price to $375 for some hospitals, and Shkreli justified his original price hike by stating that the drug was "woefully underpriced" (Sidahmed). Shkreli was eventually charged with fraud and sentenced to seven years in prison. Yet as of 2018, Daraprim still sits at $750 in most pharmacies (Smith, A.).
The truth is, Turing Pharmaceuticals wasn't the first company to raise the price of Daraprim--the drug only cost $1 per pill back in 2010, before CorePharma increased the price to $13.50, representing a 1350% price increase (Long). Although Daraprim still only costs a dollar per pill internationally, patients in the U.S. have not been so lucky (Long).
There's a fragile balance between encouraging scientific innovation through monetary incentives and controlling drug prices so that vulnerable populations are able to access life-saving medications. In recent years, China has been moving away from centralized price control while the government still maintains regulating power to lower certain prescription drug prices by an average of 44% (Lo). Meanwhile, in both India and South Africa where there is a high prevalence of diseases such as AIDS and malaria, tight pricing policies and mechanisms such as the Single Exit Price have been administered (Lo). The actions of these countries’ governments are drastically different from the U.S. government, which lets companies set drug prices however they see fit. The differences in the attitudes of these governments stems from the nature of the economic systems present in these countries, namely whether or not there exists a centralized health care plan that can cover the costs of various medications for citizens. Most of the prescription drug costs in India are paid out of pocket by the patients themselves, so it's understandable that the government must take a hard stance in pricing policies so the drugs remain affordable (Lo).
In an industry where the pricing of a product can directly influence an individual’s chances of survival, it is important that effective strategies are implemented in order to ensure that life-saving drugs remain available and accessible to everyone. Although Daraprim's price hike controversy is a prime example of companies prioritizing their own financial gain over the health of millions of people, there remains hope in the industry that regulating forces such as government institutions will be able to alleviate such issues by establishing boundaries to prevent the exploitation of human health.
"Global HIV And AIDS Statistics". AVERT, 2018, https://www.avert.org/global-hiv-and-aids-statistics. Accessed 24 Oct 2018.
Lo, Chris. "Cost Control: Drug Pricing Policies Around The World - Pharmaceutical Technology". Pharmaceutical Technology, 2018, https://www.pharmaceutical-technology.com/features/cost-control-drug-pricing-policies-around-world/. Accessed 23 Oct 2018.
Long, Heather. "What Happened To AIDS Drug That Spiked 5,000%". Cnnmoney, 2016, https://money.cnn.com/2016/08/25/news/economy/daraprim-aids-drug-high-price/index.html. Accessed 23 Oct 2018.
Sidahmed, Mazin. "Martin Shkreli: I'm Not Upset About HIV Drug Hike; It Was 'Woefully Underpriced'". The Guardian, 2016, https://www.theguardian.com/business/2016/oct/28/martin-shkreli-daraprim-hiv-drug-price-hike-interview. Accessed 23 Oct 2018.
Smith, Aaron. "Martin Shkreli Fraud Trial Begins Next Week". Cnnmoney, 2017, https://money.cnn.com/2017/06/23/news/companies/martin-shkreli-trial/index.html. Accessed 23 Oct 2018.
Smith, Lydia. "Daraprim: What Is The Drug And How Are Pharmaceuticals Priced?". International Business Times UK, 2015, https://www.ibtimes.co.uk/daraprim-what-drug-how-are-pharmaceuticals-priced-1520870. Accessed 23 Oct 2018.