Valeant execs testify at Congressional hearing on drug prices
Last week, executives from Valeant Pharmaceuticals testified before the Senate’s Special Committee on Aging during the third in a series of hearings investigating sudden price spikes in drugs that have been around for decades.
During the three-hour hearing, Senate committee members took turns admonishing the execs for an unethical business model that put profits before patients. The committee’s investigation uncovered that after Valeant bought the drugs Syprine and Cuprimine, they jacked the drug’s prices 3200 percent and 6000 percent, respectively.
These drugs are the primary treatments for Wilson’s Disease, a rare and life-threatening but treatable disease where copper accumulates in vital organs. Berna Heyman, a patient with Wilson Disease, testified before the committee regarding her experience with Valeant’s drug Syprine. “Syprine has been around for more than 30 years. It is an old drug,” said Heyman. “As I understand it, Valeant did not spend a cent on research and development for this drug.”
Heyman said her co-pay for Syprine was less than $700 per year until 2013. By 2014, her projected co-pay was more than $10,000 a year with her insurance responsible for upwards of $260,000. Because she was on Medicare, Heyman didn’t qualify for patient assistance programs. She was forced to switch to an inferior drug simply due to cost.
“This kind of price manipulation and abuse of pricing has real consequences,” said Senator Susan Collins (R-ME). “It has consequences for patients who can’t take the drug of their choice. It has consequences for doctors who are treating individuals who need these drugs. It has consequences for our hospitals at a time when they are trying to lower health care costs. That is why we are determined to come up with solutions to solve this problem.”
Outgoing CEO Michael Pearson admitted Valeant’s price hikes were too aggressive. He expressed regret for “pursuing transactions where a central premise was a planned increase in the price of medicines.”
Pearson later suggested that the despite these price hikes, the market was working, pointing out the company’s stock plummeted after all the bad press the company received. Valeant shares were $34.32 on May 3. Last year at this time, they were $222.86.
Senator Richard Blumenthal (D-CT) expressed concern for future price hikes. He urged Valeant to develop policy to prevent their profit motive from “eclipsing social responsibility.”
Senator Collins spoke of Valeant’s exploitation of the system and the need for preventative measures. Senators Collins and Claire McCaskill (D-MO), the chairman and ranking member of the Senate Special Committee on Aging, recently introduced the “Increasing Competition in Pharmaceuticals Act” (S. 2615) to help address the problem by fast-tracking the approval of generics with only one manufacturer or those in short supply.
We’re pleased the drug pricing issue continues to demand attention. But we hope Congress plans to probe beyond the handful of companies like Valeant and Turing with blatant and egregious price hikes. The pharmaceutical industry has a long history of underhanded tactics, such as “pay for delay” deals that block consumer access to cheaper generic drugs. We’re all paying more than ever before for medications, in part because of such profit-centered strategies.
You can watch a recording of the hearing at on the Senate Special Committee on Aging website.