Presidential hopeful Hillary Clinton announced plans Monday to cap monthly out-of-pocket costs for specialty drugs, citing the "outrageous" case of a lifesaving tablet that saw its price go up by 4,000 percent overnight.
She is expected to allude to her plan in remarks on Monday in Baton Rouge, Louisiana, and to spell it out in more detail at a health care forum in Des Moines, Iowa, on Tuesday, her campaign said. It added the proposal aims to reduce profiteering by drug companies.
Biotech stocks tumbled on Monday after Clinton's tweet against "price gouging" in specialty drug markets, citing a New York Times story.
Clinton tweeted, "Price gouging like this in the specialty drug market is outrageous. Tomorrow I'll lay out a plan to take it on."
The Times article referred to drug prices that have skyrocketed, in some cases because of drug shortages. But others have seen their price jump because of a business strategy of buying older drugs and turning them into expensive specialty drugs.
Turing Pharmaceuticals increased the price of Daraprim — a treatment against toxoplasmosis, a parasitic infection — by 4,000 percent in August after it bought the drug earlier in the summer.
The pricing maneuver is a cause of rising concern for patients nationwide, with retail prices for branded prescription drugs increasing by an average of 12.9 percent in 2013 from the year before, according to a study by the AARP’s Public Policy Institute. That year’s jump was the highest since 2006, the report found.
Advocacy organizations the Infectious Diseases Society of America and the HIV Medicines Association sent a letter to Turing last week to demand the company lower its price for Daraprim after reports from hospitals said they could no longer afford the drug.
"This cost is unjustifiable for the medically vulnerable patient population in need of this medication and unsustainable for the health care system," they wrote.
Martin Shkreli, the CEO of Turing, dismissed the criticism and told the Times that he would inject additional profits into research to develop a better drug. “This isn’t the greedy drug company trying to gouge patients. It is us trying to stay in business,” he told the Times.
Stock markets reacted sharply to Clinton’s announcement. After climbing more than 1 percent in the early portion of trading, Wall Street pared gains on the biotech weakness, with the Nasdaq composite in negative territory and the S&P 500 hovering near the unchanged mark.
Al Jazeera and Reuters