The former hedge fund manager who ignited a firestorm of criticism over drug prices after hiking the price of a specialized drug from $13.50 a tablet to $750 a tablet said in an interview Tuesday his company will substantially lower the price.
Martin Shkreli, CEO of Turing Pharmaceuticals, told ABC News his company will lower the price of Daraprim after several days of making headlines and receiving complaints from medical groups, however he did not specify the new cost.
"We've agreed to lower the price on Daraprim to a point that is more affordable and is able to allow the company to make a profit, but a very small profit," he said.
Shkreli also defended the price hike his start-up company recently instituted after it acquired the drug, telling ABC that critics don't understand how companies like his work. Shkreli said that his company already gives away half of the supply of Daraprim for "free or for $1."
ORIGINAL REPORT BELOW:
(AP) - Drugmaker Turing Pharmaceuticals has hiked the price of a 53-year-old drug for a potentially deadly parasitic infection from $13.50 per pill to $750.
Because the drug, Daraprim, treats patients with compromised immune systems, the price hike of more than 5,000 percent sparked outrage from medical groups representing doctors who care for patients with HIV and other infectious diseases.
One drugmaker, Mallinckrodt Pharmaceuticals PLC, saw shares drop 10.02 percent. The top 20 drugmakers whose products include biologic or specialty drugs posted share drops of more than 2 percent. And the Nasdaq Biotechnology Index dropped 4.4 percent.
Biologic drugs are produced in living cells and specialty drugs treat complex, chronic conditions, usually need to be injected and sometimes refrigerated, and also are very expensive.
Many new drugs for cancer, hepatitis C, rare disorders and even a new class of cholesterol drugs have prices in the range of $80,000 or more for a year or course of treatment. Some are major medical advances, saving lives and other medical costs. Others are minor improvements, such as cancer drugs that add a few months' survival over existing medicines.
So while the Turing price hike was getting the blame Monday for the stock slump, it's only the latest - though perhaps most outrageous - example of price hikes, or sky-high prices for newly launched drugs. Insurance companies, politicians, advocates for patients and other critics have been blasting those prices as outrageous and unsustainable for the health care system, not to mention patients who sometimes must pay up to 30 percent of the cost.
In the case of Turing's Daraprim, the company obtained rights to sell the drug, the only U.S.-approved treatment for toxoplasmosis, in August and hiked the price overnight. The company, run by a former hedge fund manager named Martin Shkreli, on Monday repeated comments meant to justify the increase, saying that Turing hopes to improve the drug's formulation and develop new, better drugs for the infection. It also stressed that some patients can get financial aid from the company to obtain the drug.
Biotech analyst Steve Brozak, president of WBB Securities, said that because of the furor over Turing's action, pharmaceutical and biotech drugmakers will have to defend themselves "against the coming onslaught."
"I don't think Turing has a defense," Brozak said, adding, "As long as this is debated, nothing good for the biotech industry and biotech investors can happen."