I know capitalism works...but

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Max Peck
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Re: I know capitalism works...but

Post by Max Peck »

So, essentially Turing turns a profit by gouging everyone, since the insurance companies will just adjust their premiums as necessary to maintain their profit margins (assuming there is just a single source)? It sounds like Imprimis is out to do some good for everyone then. More profit to 'em. :)

The way it works up here, my supplementary health insurance (prescription drugs aren't covered by OHIP) would switch me to whatever the cheapest generic equivalent happens to be unless my doctor specified no substitions in the prescription. In my case, I was taking Diovan HCT when the patent expired and generics became an option. On my next refill, I was switched to generic Valsartan HCT, but it was manufactured by the same company (Sandoz). The only difference was that it now came in bulk packaging instead of boxes of blister cards containing an individual pill in each little plastic bubble.

One of my friends wasn't so lucky -- she got switched from a prescribed brand name drug to a generic and had an adverse reaction to the generic. Her doctor had to intervene with the insurance company to get them to approve the brand name drug that was actually prescribed. I remember her being really mad at her pharmacist instead of the insurance company for some reason.
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Re: I know capitalism works...but

Post by LawBeefaroni »

Max Peck wrote:So, essentially Turing turns a profit by gouging everyone, since the insurance companies will just adjust their premiums as necessary to maintain their profit margins (assuming there is just a single source)?
More or less. Insurance companies will pay because they have that kind of money. Most people don't.

Max Peck wrote: It sounds like Imprimis is out to do some good for everyone then. More profit to 'em. :)
That's what's supposed to happen in a free market. Unfortunately pharma is usually anything but a free market.
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Re: I know capitalism works...but

Post by Rip »

Insurance pay because in the end they can't lose. If it cost too much they just pass it on in premium hikes. So it makes the morons think "who cares insurance companies have lots of money".

The reality is just like people who screw the government over for money, the little guy is the one that actually ends up paying for it in the end.
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Re: I know capitalism works...but

Post by malchior »

hepcat wrote:Not criminal per se, but definitely morally repugnant.
I don't get how this doesn't run afoul of antitrust. If it doesn't the law should be updated to disallow a single company to vertically control any generic drug via acquisition.
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Re: I know capitalism works...but

Post by stessier »

Good news - they decided not to lower the drug price at all.

I wonder if the media can get wound up into a frenzy a second time now that so much time has passed. I'm guessing Turing is betting the answer is no.
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Re: I know capitalism works...but

Post by Grifman »

Here's our real drug cost problem:

http://www.wsj.com/articles/why-the-u-s ... 1448939481
What it found, in the case of Norway, was that U.S. prices were higher for 93% of 40 top branded drugs available in both countries in the third quarter. Similar patterns appeared when U.S. prices were compared with those in England and Canada’s Ontario province. Throughout the developed world, branded prescription drugs are generally cheaper than in the U.S.
More Reading

The upshot is Americans fund much of the global drug industry’s earnings, and its efforts to find new medicines. “The U.S. is responsible for the majority of profits for most large pharmaceutical companies,” said Richard Evans, a health-care analyst at SSR LLC and a former pricing official at drug maker Roche Holding AG .
Since drugs are generally bought by govts in the rest of the world at regulated prices, the US basically funds drug research for the rest of the world.
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Re: I know capitalism works...but

Post by stessier »

I mean, there are worse things we spend our money on.
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Re: I know capitalism works...but

Post by GreenGoo »

In case you're feeling unappreciated, I just want to say thanks for your hard work. We're all counting on you.
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Re: I know capitalism works...but

Post by LawBeefaroni »

Grifman wrote:Here's our real drug cost problem:

http://www.wsj.com/articles/why-the-u-s ... 1448939481
What it found, in the case of Norway, was that U.S. prices were higher for 93% of 40 top branded drugs available in both countries in the third quarter. Similar patterns appeared when U.S. prices were compared with those in England and Canada’s Ontario province. Throughout the developed world, branded prescription drugs are generally cheaper than in the U.S.
More Reading

The upshot is Americans fund much of the global drug industry’s earnings, and its efforts to find new medicines. “The U.S. is responsible for the majority of profits for most large pharmaceutical companies,” said Richard Evans, a health-care analyst at SSR LLC and a former pricing official at drug maker Roche Holding AG .
Since drugs are generally bought by govts in the rest of the world at regulated prices, the US basically funds drug research for the rest of the world.
That's one way to put it. The other is that the US basically funds drug company profits.

Merck, for example, spent $1.5B on R&D in 3Q 2015. Their profit, after taxes and expenses including R&D, was $1.8B.

Yes, we do fund their R&D but it's not like they wouldn't be able to do any R&D without fleecing US customers.
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Re: I know capitalism works...but

Post by malchior »

And we pay for it twice since the drug companies are often building on basic R&D paid for the Federal Government in the first place. :)

To be honest, the beggaring your neighbor argument is true but probably incomplete. Patent Law, FDA practices, unwillingness of the government to attack anti-competitive practices in this particular marketplace, direct advertising to consumers, and drug company incentives to doctors all play a part to name some. Plus that guy is a complete douchebag - their investment was basically nil - they just saw a chance to exploit the market and sick people. Fuck him.
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Re: I know capitalism works...but

Post by LawBeefaroni »

malchior wrote:And we pay for it twice since the drug companies are often building on basic R&D paid for the Federal Government in the first place. :)
Thrice when they move out of the country to avoid paying US taxes, like Pfizer.

NYP wrote:This merger, which would create the world’s largest drug company, will move Pfizer-Allergan’s headquarters to Ireland, where it expects to enjoy a corporate tax rate of just 18 percent in the US, whereas Pfizer now pays an effective rate of 25 percent through existing off-shore revenue — already whittled down from the US’s corporate rate of 35 percent.
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Re: I know capitalism works...but

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malchior wrote:And we pay for it twice since the drug companies are often building on basic R&D paid for the Federal Government in the first place. :)
Thrice when they move out of the country to avoid paying US taxes, like Pfizer.

NYP wrote:This merger, which would create the world’s largest drug company, will move Pfizer-Allergan’s headquarters to Ireland, where it expects to enjoy a corporate tax rate of just 18 percent in the US, whereas Pfizer now pays an effective rate of 25 percent through existing off-shore revenue — already whittled down from the US’s corporate rate of 35 percent.
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Re: I know capitalism works...but

Post by Isgrimnur »

So that's sextuply, then?
It's almost as if people are the problem.
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Re: I know capitalism works...but

Post by LawBeefaroni »

Ugh. Server issues here. :oops:
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Re: I know capitalism works...but

Post by Isgrimnur »

No worries. :D
It's almost as if people are the problem.
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Re: I know capitalism works...but

Post by Grifman »

LawBeefaroni wrote:That's one way to put it. The other is that the US basically funds drug company profits.
'

Uh, that's exactly what the link I quoted from says:
The upshot is Americans fund much of the global drug industry’s earnings, and its efforts to find new medicines.
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Re: I know capitalism works...but

Post by LawBeefaroni »

Grifman wrote:
LawBeefaroni wrote:That's one way to put it. The other is that the US basically funds drug company profits.
'

Uh, that's exactly what the link I quoted from says:
The upshot is Americans fund much of the global drug industry’s earnings, and its efforts to find new medicines.
I glossed over the article quote and just read yours where you stress R&D.
Since drugs are generally bought by govts in the rest of the world at regulated prices, the US basically funds drug research for the rest of the world.
Point is, their profits are almost always equal to or greater than their R&D spending.


One could say that these companies wouldn't exist to do the R&D if they didn't make healthy profits for investors, and it's true. But they also won't bother doing R&D on an effective drug if they can't profit from it (patent or otherwise monopolize it).

If you can patent a drug that reduces breast cancer recurrence by say 10%, you'd pour hundreds of millions, even billions, into R&D. But when there is early evidence that aspirin may reduce it by 50% plus, no one funds a study because there's no profit in it. Well, or they have to scrap and fight for government crumbs.

(Where does all that Breast Cancer Awareness money go? To marketing of Breast Cancer Awareness, retailers, and maybe R&D into profitable drugs.)
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Re: I know capitalism works...but

Post by Pyperkub »

Grifman wrote:Here's our real drug cost problem:

http://www.wsj.com/articles/why-the-u-s ... 1448939481
What it found, in the case of Norway, was that U.S. prices were higher for 93% of 40 top branded drugs available in both countries in the third quarter. Similar patterns appeared when U.S. prices were compared with those in England and Canada’s Ontario province. Throughout the developed world, branded prescription drugs are generally cheaper than in the U.S.
More Reading

The upshot is Americans fund much of the global drug industry’s earnings, and its efforts to find new medicines. “The U.S. is responsible for the majority of profits for most large pharmaceutical companies,” said Richard Evans, a health-care analyst at SSR LLC and a former pricing official at drug maker Roche Holding AG .
Since drugs are generally bought by govts in the rest of the world at regulated prices, the US basically funds drug research for the rest of the world.
This is a bit silly (and behind a paywall), but a better, more adequate comparison would be generics, not brand name drugs.
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Re: I know capitalism works...but

Post by stessier »

And now Express Scripts has added a compounder to it's network and is getting the word about so people can get the drug for around $1/pill again.
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Re: I know capitalism works...but

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Re: I know capitalism works...but

Post by GreenGoo »

Shrug. Outside of his business dealings (which I do have a problem with) I don't care how he spends his money. He could burn it and snort it up his nose for all I care.
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Re: I know capitalism works...but

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GreenGoo wrote:
Shrug. Outside of his business dealings (which I do have a problem with) I don't care how he spends his money. He could burn it and snort it up his nose for all I care.
So, you don't care that the cocky little sociopath spent about $2,000,000 (which translates to a measly 2,667 pills of his drug) on this one-of-many vanity items? Cool, thanks for sharing.

Would you care more if you knew that he laughed at some bad Jewish Grinch jokes while listening to it? ;)

P.S. Noting when people care enough to comment that they don't care about something is one of my (many) hobbies.
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Re: I know capitalism works...but

Post by LawBeefaroni »

Max Peck wrote:
GreenGoo wrote:
Shrug. Outside of his business dealings (which I do have a problem with) I don't care how he spends his money. He could burn it and snort it up his nose for all I care.
So, you don't care that the cocky little sociopath spent about $2,000,000 (which translates to a measly 2,667 pills of his drug) on this one-of-many vanity items? Cool, thanks for sharing.

Would you care more if you knew that he laughed at some bad Jewish Grinch jokes while listening to it? ;)

P.S. Noting when people care enough to comment that they don't care about something is one of my (many) hobbies.
Aww, come on now, he's just a lonely guy trying to pay for friends.
Shkreli, who describes himself as a bit of a recluse, recalls Gilkes telling him that if he bought the record, he would have the opportunity to rub shoulders with celebrities and rappers who would want to hear it. “Then I really became convinced that I should be the buyer,” Shkreli says.

...
Shkreli told Bloomberg, “I could be convinced to listen to it earlier if Taylor Swift wants to hear it or something like that. But for now, I think I’m going to kind of save it for a rainy day.”
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Re: I know capitalism works...but

Post by hepcat »

I hope he saved the receipt.
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Re: I know capitalism works...but

Post by GreenGoo »

Max Peck wrote:
GreenGoo wrote:
Shrug. Outside of his business dealings (which I do have a problem with) I don't care how he spends his money. He could burn it and snort it up his nose for all I care.
So, you don't care that the cocky little sociopath spent about $2,000,000 (which translates to a measly 2,667 pills of his drug) on this one-of-many vanity items? Cool, thanks for sharing.

Would you care more if you knew that he laughed at some bad Jewish Grinch jokes while listening to it? ;)

P.S. Noting when people care enough to comment that they don't care about something is one of my (many) hobbies.
Nope. Not caring how people spend there money is one of my hobbies. Commenting on OO, whether I feel strongly or not about the subject is also one. Responding that I don't care to a post explicitly suggesting that I should care about something is not unusual.

*I* am not the poster of this information. If I'd come out of the blue and said "look at this little douchebag spending his money like a fool. I don't care what he does with it", that might be noteworthy. Responding to hitbyambulance is just me responding to hitbyambulance. It's not hypocritical to have an opinion of apathy on a topic, even if that topic is that I should have a strong opinion about it (self referential).

Let's see if I can be clearer, since I'm struggling lately.

Jeff V will jump into a thread to let everyone know that he doesn't care.

Hitbyambulance's post includes an implied "doesn't this make you mad?". Me saying "no, not really" is not the same thing as Bombing a thread with a negative opinion nor is it the same thing as protesting too much.

I do care how he made his money. I don't care what he does with it after he's got it. Certainly not in the way it was implied in the post anyway. You can "rub my nose" in how he spends his money all you want. It's just not important to me.

And to be clear, my lengthy response here is because I would like to clarify my viewpoint. Which I do care very much about.
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Re: I know capitalism works...but

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We already knew he was the poster boy of capitalist assholes. Should we really be surprised that he overachieved?
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Re: I know capitalism works...but

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I'm a firm believer in karma.

This son of a bitch will get his. We might not ever see, hear, or know about it. But this bastard has his coming to him.
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Re: I know capitalism works...but

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The Atlantic
[T]he pharmaceutical executive Martin Shkreli has found a new project: making an essential treatment unaffordable for poor immigrants from Latin America.
...
He’s now the CEO of KaloBios Pharmaceuticals, which recently announced its plans to submit benznidazole, a treatment for Chagas disease purchased earlier this month, for Food and Drug Administration approval next year. The Centers for Disease Control and Prevention estimates that about 300,000 people in the United States have the deadly disease. Most of them are immigrants from Latin America, where as many as 8 million people are infected.

The third most common parasite disease in the world, Chagas, also known as the “kissing bug disease,” is transmitted via the painless bites of Triatomine insects. Untreated, it can lead to heart failure and death. Last year, researchers at the Baylor College of Medicine identified Chagas in several patients who hadn’t traveled outside of the country, positing that they may have come into contact with the bugs through camping and hunting. That said, the risk of contracting the parasite in the U.S. remains small; most people who have the disease in the United States already had it when they arrived.

Right now, doctors in the U.S. obtain benznidazole free of charge through the CDC. According to Rachel Cohen, the regional executive director of the Drugs for Neglected Disease Initiative in North America, the drug sells in Latin America for somewhere between $60 and $100 for each course of treatment. Both of these would change the moment the FDA approved benznidazole from any company—and Shkreli, in particular, seems determined to price this drug out of reach of the people who need it. In filings with the Securities and Exchange Commission, KaloBios wrote that it expects to price the Chagas drug similarly to antivirals for Hepatitis C, which can cost almost $100,000 for a single course of treatment in the United States.
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Re: I know capitalism works...but

Post by LordMortis »

So he paid two million for the right rights to a $100 drug that millions of people use so he can charge $100,000 for it? That sounds like the stuff fictional TV detective show assassination of villains that put away a desperate working class father are made of.

It also sounds like me trying really hard not not to R&P this with talk of single payer systems and the ACA and failing.

This should be a central topic of every congressional and presidential discussion.
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Re: I know capitalism works...but

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I don't understand how the CDC can distribute a drug that isn't FDA approved. I also don't understand how FDA approval can grant exclusive distribution rights to a drug outside of a patent, especially outside of the country. Especially when a Brazilian company already supplies the drug.

Of course, he's already paid for his Wu Tang album with KaloBios:
Image

And speculation from back then that he was making a long bet on cancer drugs is laughable now knowing his plans.


LordMortis wrote:That sounds like the stuff fictional TV detective show assassination of villains that put away a desperate working class father are made of.
He should probably take the Olympics off his 2016 travel itinerary.
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Re: I know capitalism works...but

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Good news, but it shows how slow to act the SEC is. Some of this has been obvious since 2012 but they are only moving on it now that he is so reviled. That's 3+ years of raking in millions.
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Re: I know capitalism works...but

Post by El Guapo »

LawBeefaroni wrote:
Good news, but it shows how slow to act the SEC is. Some of this has been obvious since 2012 but they are only moving on it now that he is so reviled. That's 3+ years of raking in millions.
That's not really accurate. If you look at the timeline, Shkreli was only fired from the company he's accused of defrauding (Retrophin) in 2014, which tells you a lot about when the relevant alleged misconduct came to light - it's not like they found out about the alleged fraud in 2012 but decided to keep him around for two years out of the kindness of their hearts. And Retrophin only sued him as of a few months ago, and they're the ones with actual money at stake here.
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Re: I know capitalism works...but

Post by El Guapo »

Honestly, I think Shkreli's long-term business plan might be to ultimately offer everyone in America the chance to punch him in the face one time for $100 apiece.
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Re: I know capitalism works...but

Post by LawBeefaroni »

El Guapo wrote:
LawBeefaroni wrote:
Good news, but it shows how slow to act the SEC is. Some of this has been obvious since 2012 but they are only moving on it now that he is so reviled. That's 3+ years of raking in millions.
That's not really accurate. If you look at the timeline, Shkreli was only fired from the company he's accused of defrauding (Retrophin) in 2014, which tells you a lot about when the relevant alleged misconduct came to light - it's not like they found out about the alleged fraud in 2012 but decided to keep him around for two years out of the kindness of their hearts. And Retrophin only sued him as of a few months ago, and they're the ones with actual money at stake here.
The Securities and Exchange Commission, which according to court documents opened an investigation into Shkreli in 2012, is expected to file a parallel civil complaint against him, according to people familiar with the matter.
I was going on that, he was on their radar at least as early as 2012. One of the trades in the Reterophin complaint dates back to 2011. And he started his career shorting stocks he bashed in chat rooms. He's like the reverse Jonathan Lebed. But nothing until now?

I know they have to be cautious, but it always seems like the SEC waits for news and public opinion to back punitive actions rather than trying to root out and prevent fraud earlier.


EDIT: Oh, and on the Retrophin firing, he was the founder, CEO, and largest share holder. I takes a lot to fire that guy. I don't put much stake in the timing of his firing, except that it must have been pretty bad by that point to be able to oust him.
Last edited by LawBeefaroni on Thu Dec 17, 2015 10:19 am, edited 1 time in total.
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Re: I know capitalism works...but

Post by El Guapo »

LawBeefaroni wrote:
El Guapo wrote:
LawBeefaroni wrote:
Good news, but it shows how slow to act the SEC is. Some of this has been obvious since 2012 but they are only moving on it now that he is so reviled. That's 3+ years of raking in millions.
That's not really accurate. If you look at the timeline, Shkreli was only fired from the company he's accused of defrauding (Retrophin) in 2014, which tells you a lot about when the relevant alleged misconduct came to light - it's not like they found out about the alleged fraud in 2012 but decided to keep him around for two years out of the kindness of their hearts. And Retrophin only sued him as of a few months ago, and they're the ones with actual money at stake here.
The Securities and Exchange Commission, which according to court documents opened an investigation into Shkreli in 2012, is expected to file a parallel civil complaint against him, according to people familiar with the matter.
I was going on that, he was on their radar at least as early as 2012. One of the trades in the Reterophin complaint dates back to 2011. And he started his career shorting stocks he bashed in chat rooms. He's like the reverse Jonathan Lebed. But nothing until now?

I know they have to be cautious, but it always seems like the SEC waits for news and public opinion to back punitive actions rather than trying to root out and prevent fraud earlier.
About 2009: Founds MSMB Capital Management, which later suffers losses on a bad trade with Merrill Lynch.
He's a busy boy. But not every issue turns into a case. On top of that, you have to factor in that building a complex securities case that will hold up, especially when you are dealing with high priced defense attorneys, is something that takes a year, minimum.

More to the point, to think that the SEC and other federal authorities have been sitting on the case for three years would require believing that the company that he allegedly defrauded sat on this for two years.
EDIT: Oh, and on the Retrophin firing, he was the founder, CEO, and largest share holder. I takes a lot to fire that guy. I don't put much stake in the timing of his firing, except that it must have been pretty bad by that point to be able to oust him.
Not really that hard for a board to fire a CEO who has defrauded the company.
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JSHAW
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Re: I know capitalism works...but

Post by JSHAW »

Karma bites rich douche in the ass.
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Max Peck
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Re: I know capitalism works...but

Post by Max Peck »

LordMortis wrote:So he paid two million for the right rights to a $100 drug that millions of people use so he can charge $100,000 for it? That sounds like the stuff fictional TV detective show assassination of villains that put away a desperate working class father are made of.

It also sounds like me trying really hard not not to R&P this with talk of single payer systems and the ACA and failing.

This should be a central topic of every congressional and presidential discussion.
It has not gone completely unnoticed.
At least two separate Congressional probes have been launched since September on the pricing issues of Daraprim, which had long been available as a generic drug used to treat toxoplasmosis in AIDS patients. Turing is under investigation by the New York state attorney general for antitrust concerns.

At a Senate hearing on drug pricing last week, a doctor who treats babies with life-threatening toxoplasmosis testified that a course of treatment with Daraprim went from about $1,200 to no less than $69,000.
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LawBeefaroni
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Re: I know capitalism works...but

Post by LawBeefaroni »

El Guapo wrote:
About 2009: Founds MSMB Capital Management, which later suffers losses on a bad trade with Merrill Lynch.
And in 2011 he inappropriately uses Retrohpin capital to pay back some of those losses, as brought to the attention of the SEC in 2012.
El Guapo wrote: He's a busy boy. But not every issue turns into a case. On top of that, you have to factor in that building a complex securities case that will hold up, especially when you are dealing with high priced defense attorneys, is something that takes a year, minimum.
I'll grant that. But why is it they always seem to finish building their case built right when public opinion is the most in their favor? I also get that a lot of things that sway public opinion come from the SEC investigation but it always seems like, "Well, the money has seemingly evaporated while the subject has continued to defraud but everyone is on our ass to do something so we'll come up with some pittance of a fine and be on our way." I have to think that pressure from various congressmen and possibly the executive have been on the SEC for the last month or so to make this happen.
El Guapo wrote: More to the point, to think that the SEC and other federal authorities have been sitting on the case for three years would require believing that the company that he allegedly defrauded sat on this for two years.
My edit above:
EDIT: Oh, and on the Retrophin firing, he was the founder, CEO, and largest share holder. I takes a lot to fire that guy. I don't put much stake in the timing of his firing, except that it must have been pretty bad by that point to be able to oust him.

Bottom line, this guy has been able to continue along with no resistance for years and is so emboldened that he's tweeting LOLs about pricing people out of life saving drugs. He started his career doing reverse pump and dumps what, more than 10 years ago, and has moved on to owning drug companies and price gouging. Yes, he's a shitbag but there's also a problem with the regulatory system.
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Re: I know capitalism works...but

Post by El Guapo »

LawBeefaroni wrote:
Bottom line, this guy has been able to continue along with no resistance for years and is so emboldened that he's tweeting LOLs about pricing people out of life saving drugs. He started his career doing reverse pump and dumps what, more than 10 years ago, and has moved on to owning drug companies and price gouging. Yes, he's a shitbag but there's also a problem with the regulatory system.
It's worth noting that only one thing there (the pump and dumps) is even plausibly a securities law violation. Being a horrible douchebag is not a securities law violation - at their core securities laws primarily punish lying, and he's been pretty open about being a horrible douchebag for the most part.

I haven't been involved in the SEC's Shkreli investigations so I can't really say whether they've taken longer than they should've or what have you. As I said, putting together a complex securities law case from start to litigation when you're dealing with expensive defense attorneys is a year minimum, and two years is honestly not all that unreasonable. Maybe this was done poorly, I don't know, but the article doesn't really raise all that much in the way of concerns for me.
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