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Tags: turing | ceo | smirks | imbeciles

Drug Co. CEO Calls Lawmakers 'Imbeciles,' Takes Fifth on Jacked-Up Pricing

Drug Co. CEO Calls Lawmakers 'Imbeciles,' Takes Fifth on Jacked-Up Pricing

Thursday, 04 February 2016 10:55 AM EST

Members of Congress opened a hearing into the price of prescription drugs with strong criticism of Valeant Pharmaceuticals International Inc. and Turing Pharmaceuticals AG, accusing the companies of dramatically increasing up the price of old drugs.

“They bought them, jacked up the prices, took as much money as they could out of the pockets of patients, hospitals, and others, and then put those funds into their own coffers,” said Representative Elijah Cummings of Maryland, the top Democrat on the House Committee on Oversight and Government Reform.

Much of the hearing is expected to focus on Martin Shkreli, Turing’s outspoken former Chief Executive Officer, who promised to invoke the Fifth Amendment and not testify further.

After smirking and posing for pictures during his appearance, Shkreli tweeted after leaving: “Hard to accept that these imbeciles represent the people in our government.”

He said earlier this week that he wished he could tangle with Congress. Shkreli cracked a smile midway through Cummings’s remarks about how the company’s price hikes hurt patients.

“It’s not funny, Mr. Shkreli, people are dying,” Cummings said at the packed hearing room in Washington. Shkreli is facing federal fraud charges unrelated to Turing. He has maintained his innocence.

Shkreli declined to make any comments to the committee. “On the advice of counsel, I invoke my Fifth Amendment.”

Representative Trey Gowdy, a South Carolina Republican, tried to lure Shkreli into speaking by asking him how to pronounce his name, which Shkreli provided.

Invokes Fifth

“See there, you can answer!" Gowdy said. Shkreli then turned to his lawyer, who was sitting behind him, and turned back to the congressmen.

"I intend to follow the advice of my counsel, not yours,” Shkreli said to Gowdy. Gowdy kept pressing Shkreli, saying that the hearing wasn’t focused on the charges against Shkreli. Shkreli repeatedly invoked his Fifth Amendment rights.

At one point, Shkreli’s lawyer, Ben Brafman, asked, “May I interject, Mr. Chairman?”

“You are not recognized, and you will be seated,” Chaffetz said.

Turing and Valeant have become the poster companies for an industry that has been increasingly in the spotlight in Washington for raising some prices so high that they’re out of reach for many patients and straining state and federal budgets.

As Cummings spoke, Shkreli smiled and toyed with a wooden pencil.

“I know you’re smiling but I’m very serous, sir,” Cummings said. “You have a spotlight and you have a platform. You could use that attention to come clean, to right your wrongs and to become one of the most effective patients’ advocates in the country and one that can make a big difference in so many peoples lives”

Valeant Testimony

Valeant interim CEO Howard Schiller, in prepared testimony released yesterday, explained why the company decided to increase the prices of two cardiac drugs by 525 percent and 212 percent, and promised to end an era of sharp hikes. Valeant’s CEO Mike Pearson is out on medical leave.

“While, like most other pharmaceutical companies, we will from time to time raise prices, I expect those price increases to be within industry norms and much more modest than the ones that drew this Committee’s legitimate concern,” Schiller said in his prepared remarks.

“Where we’re made mistakes, we’re listening and we’re changing,” he told the committee at the hearing.

Cummings said that his constituents were being hurt by the companies’ actions, making a reference to Pearson’s wealth and Shkreli’s purchase of an expensive single-copy rap album.

“The people in my district aren’t on the Forbes billionaire list,” Cummings said. “They don’t buy $2 million Wu-Tang albums. They can’t liquidate assets to free up millions of dollars.”

FDA Issues

Committee Chairman Jason Chaffetz, a Republican from Utah, blamed the Food and Drug Administration for not working fast enough to approve generic drugs, saying the agency was "drowning in a backlog" of applications. 

"I believe that the FDA has failed to meet its statutory responsibilities," Chaffetz said. “If somebody increases the price of a prescription drug that’s going to invite more competition but if that competition can’t get approval from the FDA there will be no competition.”

Janet Woodcook, an FDA official, said the agency was working quickly through the list of applications and that the backlog wasn’t as bad as Chaffetz made it seem.

“The generic backlog was a big problem,” she said. “This was ultimately fixed” but takes time to implement.

Valeant had come under fire last year after boosting the prices of the two drugs, Isuprel and Nitropress, shortly after buying them. During the acquisition process from Marathon Pharmaceuticals, Valeant commissioned a review from a pricing consultant, who found that there was still “considerable room” to increase their prices because hospitals using them were reimbursed at rates that were higher than the cost of the drugs. Valeant has since instituted a program that offers rebates to hospitals that use large volumes of the drugs, said Schiller, who was appointed interim chief last month while CEO Michael Pearson is on medical leave.

Both Turing and Valeant say pricing is complex in their industry, and that list prices don’t reflect discounts and rebates.

© Copyright 2023 Bloomberg News. All rights reserved.

Members of Congress opened a hearing into the price of prescription drugs with strong criticism of Valeant Pharmaceuticals International Inc. and Turing Pharmaceuticals AG, accusing the companies of dramatically increasing up the price of old drugs."They bought them, jacked...
turing, ceo, smirks, imbeciles
Thursday, 04 February 2016 10:55 AM
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