NASDAQ Biotechnology Index (Sept. 21, 2015)
In
a scathing new report released over the weekend, the
New York Times detailed how a start-up called Turing Pharmaceuticals recently acquired a 62-year-old specialty drug used to fight parastic infections and promptly raised the price 5,500 percent, from $13.50 a tablet to $750. Even worse, Turing is far from the only malefactor when it comes to hiking the cost of old medications, many of which are generic:
• Cycloserine, used to trade multidrug-resistant tuberculosis: 30 pills now cost $10,800, up from $500 after Rodelis Therapeutics acquired the drug
• Isuprel and Nitropress, heart drugs: price increased 525 percent and 212 percent, respectively, after Valeant Pharmaceuticals acquired them from Marahton Pharmaceuticals; Marathon had bought the drugs in 2013 and quintupled their prices
• Doxycycline, an antibiotic: went from $20 a bottle (Oct. 2013) to $1,849 (April 2014)
Normal Americans reacted with appropriate outrage at this appalling news, but Wall Street issued a collective shrug. Until, that is, Hillary Clinton announced her intention
to tackle the problem:
Then, suddenly, investors took notice. Clinton's announcement came at 10:56 AM ET. In the chart at the top of this post, you can see how NASDAQ's Biotechnology Index immediately trended downward at that point, hitting an intraday drop of 3.4 percent before starting to recover.
Wall Street may not be moved by major stories in the Times, but it definitely takes Hillary Clinton seriously. And while some pharmaceutical companies might see their profits trimmed a bit, if Clinton is successful in taking on these intolerable price hikes, it'll be a huge victory for everyone else.