A drug used to treat tuberculosis underwent a massive price hike that has caused an outrage among medical professionals, members of the public and even government officials. Because of the massive negative response it garnered, the said overnight drug price inflation was rescinded shortly.
On Aug 19, 2015, Rodelis Therapeutics was able to acquire the rights of Cycloserine from The Chao Center, which is a non-profit organization connected with Purdue University.
After the acquisition, Rodelis increased the price of Cycloserine by more than 5,000 percent, such that the $500 price of 30 capsules was raised to a whopping $10,800. The organization found the action that Rodelis has done, said Dan Hasler, the president of the Purdue Research Foundation. The foundation said that it was not their intention to turn up this way, he added.
The organization was shocked and demanded the return of the drug's rights to them, as announced by the organization. Rodelis Therapeutics responded immediately and made a statement on their website that they will be returning the rights of Cycloserine to the outraged organization.
Now that Cycloserine has returned back to its founding home, the organization will also increase its price by 100 percent, which is still far lesser than the skyrocket values set by Rodelis. Cycloserine will now retail at $1,050 for a pack of 30 capsules. According to Hasler, the updated price of the drug was necessary to shoulder stem losses.
Cycloserine a drug treatment for multidrug-resistant tuberculosis, which is said to be used by only about 40 individuals in the US every year.
The outrage of the massive price hike reached the political world, resulting in the significant decline of biotechnology stocks due to investors' fears that government actions may soon control drug prices.
"Price-gouging like this in the specialty drug market is outrageous," tweeted Hillary Clinton on Monday, Sept. 21. Included in the tweet is her plan of laying out something on Tuesday, Sept. 22 to tackle this issue.
Turing Pharmaceuticals also faced a similar issue recently when it acquired Daraprim, which is an old medicine for severe parasitic infections. After getting its rights, the company increased its price from $13.50 per tablet to $750.
The inflation of Cycloserine and Daraprim are just some of the examples of pharmaceutical companies' new business approach, which entails buying the rights of rarely used, old drugs and transforming it into "specialty drugs" to amp up the price.
Photo: Day Donaldson | Flickr