FDA changes drug review rules to challenge Martin Shkreli-like medicine monopolies
The Food and Drug Administration (FDA) is now granting an “expedited review” to generic drugs producers that would compete with brand-named treatments, currently produced by only one manufacturer.
The new rule is going to make an approval process faster for off-patent producers, which potentially means that exclusive drug makers will face increased competition sooner and might be toppled from their monopoly position, largely exploited to hike up prices for life-saving drugs.
According to FDA estimates, the change in prioritization could expedite reviews of as many as 125 generic drug applications, Sandy Walsh, an agency spokeswoman, told Bloomberg.
The FDA’s amendment comes amid the nationwide outrage over price gouging, recently exemplified by Martin Shkreli and the company he formerly owned. Under Shkreli as CEO, Turing Pharmaceuticals raised raised the price of Daraprim, a drug essential for HIV treatment 5,500 percent, from $13.50 to $750 per pill in just over a month last fall.
With the price increase, some patients received $16,000 co-pays for a single prescription, according to Ars Technica.
Daraprim’s price increase scandal was not Shkreli’s first time facing controversy. Having earned himself the title of “most hated man in America”, Shkreli was arrested on for securities fraud in December, which was not related to his raising the price of life-saving pills exponentially, but rather to his time at a hedge fund.
Prosecutors accused him of illegally taking stock from Retrophin, Inc. to pay off his personal debts from unrelated business dealings as a hedge fund manager for MSMB Funds. In 2011, he started Retrophin and acquired old drugs in order to raise their price.
Retrophin sued Shkreli in federal court for $65 million, accusing him of misusing the company’s assets, including its stocks and cash, "to enrich himself, and to pay off claims of MSMB investors (who he had defrauded)," the lawsuit said.
The FDA’s new rule may also thwart business of Valeant Pharmaceuticals, another manufacturer upped its blood pressure treatment’s price over 600 percent last year.
The high blood pressure drug Nitropress’ price shot up 625 percent to $1,346.62 per vial. Isuprel, a heart medicine, went up 820 percent, costing $36,811 for 25 pills. Cuprimine, a rheumatoid arthritis capsule, jumped 2,949 percent in price to $26,189 for 100.