But the real issue isn’t the cost of chemicals these days
A team of Australian student researchers at Sydney Grammar School has managed to recreate the formula for Daraprim, the drug made (in)famous by the actions of Turing Pharmaceuticals last year when it increased the price substantially per pill. According to Futurism, the undertaking was helped along by an, “online research-sharing platform called Open Source Malaria [OSM], which aims to use publicly available drugs and medical techniques to treat malaria.”
The students’ pill passed a battery of tests for purity, and ultimately cost $2 using different, more readily available components. It shows the potential of the platform, which has said elsewhere there is, “enormous potential to crowdsource new potential medicines efficiently.” Although Daraprim is already around, that it could be synthesized relatively easily without the same materials as usual is a good sign for OSM.
Ex-CEO Martin Shkreli, who oversaw the 2015 price hike, responded to the story by tweeting, “Dumb journalists want a feel good story,” and then groused about the sunk costs in the equipment and the team’s education.
But the issue has never really been that the drug is extremely expensive to produce in terms of the chemicals needed, or even things like the sunk costs that go into the labs and personnel who design and test drugs. The students’ effort is technically impressive, to be sure, in light of their age and ingenuity, but the bigger problem has to do with the distribution, not production, model for Daraprim in the US, where Shkreli’s (former) company has exclusive marketing rights.
This is where OSM comes into conflict with the traditional Big Pharma R&D models that, to recoup those costs, can charge huge sums for live-saving drugs when price controls are absent.
Turning Pharmaceuticals can set Daraprim’s US price (and not the price anywhere else) without much competition or regulatory challenges due to the way the system is structured between the government and the industry players. (Some of Shkreli’s peers even complained he was treating Daraprim like a hedge fund option, rather than a prescription medication.) Drug prices are largely unregulated in the US, notes Health News Review, and as such pharmaceutical companies can charge large sums even for older, niche drugs like Daraprim.
Smaller price hikes are even more common, especially for more widely consumed products, like Viagra or Lyrica. But they often go under-reported. Pfizer, for instance, has been increasing prices annually for some time, citing R&D costs for developing new drugs in-house.
Turning Pharmaceuticals has also said the additional money is needed for new R&D given how old the drug is – more than half a century – but critics question how that breaks down in the meantime. The biggest problem for patients is convincing insurance providers of their financial need to qualify for access, as well as budget-conscious hospitals who have to stock it.
Daraprim, used to treat toxoplasmosis in individuals with immune deficiencies, is readily available in Australia for about the same price as the students’ own mixture, $2 per pill. This is generally the case worldwide, but not the US, where it now costs $375 per unit.
This figure is actually less than it was last year ($750), but is still many times what it used to be before Turning Pharmaceuticals stepped in.
Or, for that matter, the now-usually forgotten CorePharma, whose 2010 price hike increased the pill’s cost to from $1 to $13.50, a sum that seems like a bargain when the Turning price is now 28 times CorePharma’s. These increases were the real opening rounds in what some doctors and consumer groups now deem a salvo of unethical price hikes, like the Mylan EpiPen imbroglio earlier this year where the price rose over 400% for what is, notes Georgetown University’s Pharmed Out project, “a century-old, generic, inexpensive drug in a patented syringe.”
Because Mylan jacked up the EpiPen’s price even as its competitors fell to the wayside, it suffered a serious short-term loss in public and investor trust. However, due to the public’s dependence on these drugs for their life saving capabilities, like in the case of Daraprim, people will continue to begrudgingly buy them.
So what can open source drug R&D do to disrupt these trends? There is real potential for malaria, at the very least, as open source drug discovery testing has achieved promising results to experiment with, “promising compounds for further malaria drug development research.” One of the leading initiatives for this approach, the OSDD, has outlined a blueprint to redress market pressures, stating that, “To ensure affordability, the drugs that come out of the OSDD platform will be made available like a generic drug, without Intellectual Property encumbrances.”
That, though, will be a much taller order than the students’ science project given the vested interests in opposition to such an approach.