The chief executive of a small pharmaceutical company defended hiking the price of an essential antibiotic by more than 400 percent and told the Financial Times that he thinks “it is a moral requirement to make money when you can.”
Nirmal Mulye, CEO of the small Missouri-based drug company Nostrum Laboratories, raised the price of bottle of nitrofurantoin from $474.75 to $2,392 last month. The drug is a decades-old antibiotic used to treat urinary-tract infections caused by Escherichia coli and certain other Gram-negative bacteria. The World Health Organization lists nitrofurantoin as an essential medicine.
In an interview with the FT, Mulye went on to say it was also a “moral requirement” to “sell the product for the highest price,” and he explained that he was in “this business to make money.”
In line with this perspective, Mulye took a moment to defend Martin Shkreli, who gained notoriety for buying exclusive rights to another decades-old drug and ruthlessly raised its price by more than 5,000 percent virtually overnight. (Shkreli was sentenced to seven years in prison in March on unrelated fraud charges.)
I agree with Martin Shkreli that when he raised the price of his drug he was within his rights because he had to reward his shareholders… If he’s the only one selling it then he can make as much money as he can… We have to make money when we can. The price of iPhones goes up, the price of cars goes up, hotel rooms are very expensive.
Mulye also noted that rival pharmaceutical company Casper Pharma raised the price of its brand-name version of nitrofurantoin, called Furadantin. Casper hiked the price by 182 percent over three years—between 2015 and 2018—bringing a bottle’s list price to $2,800.
Nostrum’s version is “still a saving regardless of whether it is a big one or not,” Mulye pointed out.
Last, Mulye attacked the Food and Drug Administration, calling the fees that drug makers pay the regulator “highway robbery” and claiming that the agency was “incompetent and corrupt.”
In a tweeted response, FDA Commissioner Scott Gottlieb hit back at Mulye’s “moral requirement” claim, writing:
[T]here’s no moral imperative to price gouge and take advantage of patients. FDA will continue to promote competition so speculators and those with no regard to public-health consequences can’t take advantage of patients who need medicine.
Both Gottlieb and Mulye noted that Nostrum’s antibiotic had been pulled from the market—as were rivals’ such as Furadantin—to meet new impurity regulations set by the FDA. Nostrum has not yet begun reshipping the drug, and Mulye warned that the price could change again “according to market conditions.”