The Pros And Cons Of Turing Pharmaceuticals

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In a matter of a few days Martin Shkreli became a villain for many. Samantha Allen a writer at The Daily Beast titled Shkreli the "most-hated man in the United States” (Allen). In September 2015, Turing Pharmaceuticals CEO Martin Shkreli raised the price of Daraprim from $13.50 to $750 per pill. The drug is used in some AIDS and cancer cases but is predominantly utilized to treat life-threatening parasitic infections. Dr. Carlos del Rio, an infectious disease expert and professor at Emory School of Medicine, says that while there are other, second-line drugs that hospitals will likely use instead of Daraprim, they’re not a true substitute (Del Rio). Daraprim was created in the 1960s, Andrew Pollack from The New York Times estimates that between…show more content…
Once that period expires, it can be duplicated under the "generic" label (FDA). This usually lowers the overall price of the medication formulation because it breaks down the monopoly and allows more companies to step into the market, creating competition, and lowering prices. For many medications that have a relatively small number of patients other companies often decide that entering the market is not lucrative enough. Daraprim is the perfect example of this. Though it has been on the market for some time, there are no competetors or generic versions because of the market size. This makes Turing Pharmaceuticals have immense power through a true monopoly with this specific medication’s…show more content…
This topic relates in a multitude of ways to the greater economy, so much so that entire classes are taught on the subject. What I believe to be the most significant is the monopoly structure and what allows that. This is how the prices of medications are determined and why. The seller's market power arises because of a few reasons; because there is a single manufacturer, or there is no exact substitute; and also for some time the “manufacturing exclusivity” is a guarantee that no potential competitor may manufacture an identical drug in the short run. Dr. Rattinger published a paper about the economics in the prescription drug market, “Since the monopolist is the only seller of a particular medicine, the monopolist determines the price and production of the medicine” (Rattinger). This establishes the monopolist as the price setter, permitting prices above the perfectly competitive price by controlling the quantity of medication produced in the marketplace. Prices are then higher in these monopoly situations in comparison to a purely competitive marketplace. These factors create barriers and limit entering market

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