Drug makers getting visability over aggressive pricing practices
Drug manufacturers have long defended their pricing by citing the need to recoup ultra-high development costs. Now another price-raising scheme is drawing attention. In a report by the Wall Street Journal, there are a growing number of examples where companies acquire drugs they perceive as undervalued and then significantly raise the prices.
In February, Valeant Pharmaceuticals (VRX -1.5%) purchased the rights to two heart drugs, Isuprel and Nitropress, from privately-held Marathon Pharmaceuticals for an undisclosed sum. It then immediately raised the prices 525% and 212%, respectively, based on the recommendations of a consultant who researched the price/benefit of each. According to Truven Health Analytics, the cost of a 1mL vial of Isuprel went from $215.46 to $1,346.62 while a 2mL vial of Nitropress went from $257.80 to $805.61.
Valeant is apparently leading the price-raising pack. It has boosted list prices by at least 20% about 122 times since early 2011.