House Committee Democrats Seek Answers on Valeant Drug Price Increases

October 5, 2015

Democrats on the House Oversight and Government Reform Committee are demanding answers on Valeant Pharmaceuticals’ massive price increases on two heart disease drugs.

The Canadian drugmaker bought Nitropress (sodium nitroprusside) and Isuprel (isoproterenol) in February and immediately raised their prices by 525 percent and 212 percent, respectively.

In a letter to committee chairman Jason Chaffetz (R-Utah), the 18 Democrats accuse Valeant of using the same business model that Turing Pharmaceuticals used when it purchased the life-saving drug Daraprim (pyrimethamine) from Impax Laboratories in August, and within a month increased the per tablet price from $13.50 to $750. Turing quickly reversed course due to public backlash, announcing it would drop the price, but not saying by how much.

Turing CEO Martin Shkreli is scheduled to testify before the committee next week, and the lawmakers want Chaffetz to subpoena Valeant CEO Michael Pearson to join him.

“It is critical to hold drug companies to account when they engage in a business strategy of buying old neglected drugs and turning them into high-priced ‘specialty drugs,’” the lawmakers write.

They want Valeant to hand over documents detailing its total revenues for the drugs; the dates, quantities, purchasers and prices paid for the drugs; total expenses relating to sales of the drugs; contracts and purchase agreements for active pharmaceutical ingredients for the drugs; profit projections; prices of the drugs in foreign countries; and the identities of those responsible for setting the prices of the drugs.

News of the potential subpoena caused Valeant’s stock to plummet nearly $50 between Monday morning and close of the market on Tuesday last week. Read the letter here www.fdanews.com/09-30-15-ValeantLetter.pdf. — Kellen Owings