Drugmaker Raises The Price Of Vitamins By 800%, Makes Shkreli Blush

Avondale, a secretive Alabama-based drugmaker, has gained unwanted national attention after the company increased the price of a bottle of vitamins to almost $300 that can be bought on the internet for $5.

In the latest example of price-gouging in America’s lightly regulated pharmaceutical industry, records show Avondale inflated the price of Niacor, a prescription-only version of niacin, by “809 percent last month, taking a bottle of 100 tablets from $32.46 to $295”, according to the Financial Times.

Niacor is the prescription form of niacin, a type of vitamin B3 that is used to treat high cholesterol and the increased risk of a heart attack. With one easy search on Google, a generic version of Niacor can be bought for $5.75 on Jet.com - meanwhile, if the consumer wants the prescription brand, well, they might have to sell their Apple Watch.

Avondale’s development of price-gouging is certainly bad timing on management’s behalf when considering Martin Shkreli, who in the past year has become the most hated man in America after he bought the rights to a drug, then raised prices by 5,500 percent. In the world of Big Pharma, buy-and-raise schemes are not limited to just Shkreli, but it’s rampant across the industry, such as Valeant Pharmaceuticals who has been accused of raising drug prices by more than 5,000 percent.

The Financial Times said Avondale acquired the rights to Niacor from Upsher Smith, a division of Japan’s Sawai Pharmaceutical, earlier this year. The buy-and-raise scheme was immediately applied to Niacor, as management faced little or no competition among other drugmakers, along with limited government regulation.

Niacor isn’t the first time the company inflated drug prices, management “increased the price of SSKI by 2,469 percent, taking a 30ml bottle from $11.48 to $295,” according to the Financial Times.

According to the data provider Iqvia, there were almost 19,000 prescriptions written for Niacor in 2016. Niacor has been described as a drug with a fast absorption rate, making it popular with the medical community. Most people are oblivious to the sharp increase of Niacor, because of the secrecy surrounding drug prices are not usually disclosed to the public.

Michael Rea, chief executive of Rx Savings said, “this is the latest example of an inefficient US market where the consumer, payer and doctor don’t have all of the information available to make a financially sound choice, which makes software to help cut what people spend on medicine.”

He warned: “They are caught in a web of inefficiency and are being taken advantage of.”

FT could not get in contact with anyone associated with Avondale, which was started in 2016 by Mark Pugh, an executive behind several pharmaceutical companies. A spokesman from Upsher confirmed the sale of products to Avondale, but could not provide further information on the price increase.

Mr Pugh has held several executive roles in the drugmaking industry, sometimes at companies that have implemented very sharp price increases. A 2014 biography says he has “more than 20 years of industry experience” and a “documented record of success in identifying and capturing new business opportunities to build high-profit, high-growth corporations”.

 

Acrogen did not return a request for comment made through its website. Emails to the company were returned undelivered. Mr Pugh did not respond to a request for comment through LinkedIn.

 

A spokesperson for Upsher confirmed it had sold the two products to Avondale, but declined to make the terms of the deal public and did not explain why it did not announce the transaction at the time.

 

It declined to say whether it continues to manufacture the product on behalf of Avondale, or whether it was aware the new owner planned to raise the price sharply.  

Avondale only has a small window of opportunity to exploit inflated drug prices, as President Trump back in October said, “Prescription drug prices are out of control” (see: Healthcare Stocks Slide After Trump Says “Drug Prices Out Of Control.)

Comments

Mr Hankey Fri, 12/15/2017 - 18:11 Permalink

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Save_America1st RAT005 Fri, 12/15/2017 - 18:33 Permalink

so let 'em raise the price of their vitamins/pills or whatever they make.  It's a free market, right?  Why not make it a 1000 bucks a bottle?  Or 1 million a bottle?  Go for it.  Why should anyone in this entire world give a fuck how much they charge for their products?You wanna open up a hotdog stand and charge 100 bucks a hotdog and 50 bucks extra for the bun?  Hey man...you go right ahead and knock yerself out.Is someone holding a gun to someone else's head forcing them to pay for it????

In reply to by RAT005

HillaryOdor NoDebt Fri, 12/15/2017 - 18:52 Permalink

lightly regulated pharmaceutical industryWtf is this bullshit.  Medicine is one of the most regulated industries, right up there with insurance and finance.  Notice how all the most heavily regulated industries turn into the biggest scams.  It's not a coincidence.  Regulation is not meant to help consumers.  It's meant to form cartels and monopolies.  Free markets help consumers, not government.  But anyway, lack of price controls is not lack of regulation.And yes you are forced to pay for this because you are forced to buy insurance which goes into a black hole from which the money for these drugs comes.  This kind of crap raises premiums. Why the hell does anyone need prescription niacin anyway?  There's nothing special about it.  It's just a B vitamin.  You can get it pretty much anywhere over the counter.

In reply to by NoDebt

RAT005 NoDebt Fri, 12/15/2017 - 18:50 Permalink

I don't buy medicine so my opinion doesn't mean much but there seems to be some suggestion that occasionally a lazy doctor prescribes this by name and somehow the prescription gets filled without a generic substitute for the ridiculous price.  Maybe the company also cobrands a generic for ~$10 a bottle for all of the usual sales.

In reply to by NoDebt

OH10DESERTER Save_America1st Fri, 12/15/2017 - 18:46 Permalink

Yes free market is great.....except the HC sector and vitamins are mostly paid for by taxpayers for taxpayers and/or moochers.  So when some twit bills taxpayers $300 bucks for a bottle of pills worth $3 bucks, b/c its prescribed by some pill loving "licensed practioner" aka licensed taxpayer fleecer, and the end user, who is on  the cusp of diabetes from sucking down Lays and Pepsi purchased w/ their SNAP card never sees the fucking bill, because he don't fucking pay it...and the dumb fuckers overseeing the insurance dgaf b/c they got their pension and dgaf what it costs.....well lets just say free market principles go out the window.  instead we get to spend millions arguing about it, fuck call a special congressional hearing, lets spend a few million a day arguing about how much a bottle of Niacin should be. 

In reply to by Save_America1st

bonin006 Save_America1st Fri, 12/15/2017 - 19:58 Permalink

No, it is not a free market. The FDA routinely grants certain companies patent rights for trivial changes to drugs that should not be patented, or where the patents should have expired. There was a case recently where they were going to that for some natural herb that people had used for thousands of years. In that case there was enough push back and they backed down (at least for now), but many/most go through.Try opening a hot dog stand where the Mafia has decided to eliminate competition, and you are not part of the club. Yes, someone is holding a gun to people's heads

In reply to by Save_America1st

waspwench bonin006 Sat, 12/16/2017 - 01:55 Permalink

And this, folks, is why Big Pharma wants to destroy the Vitamins/Minerals/Supplements business.

If they can make these items unavailable over-the-counter they will quickly convert them into Rx only items, and you will find yourselves paying hundreds of dollars for a few Vitamin C pills.

A lot of people do not understand why many of us are very concerned about Big Pharma's attempts to outlaw the free availability of these items. They think we are health nuts but, for the educated consumer, an in an era when much of our food supply is adulterated or of poor quality, food supplements are of increasing importance. These are substances which occur naturally in our foods, if our foods are of good quality. Unfortunately, they increasingly are not. Supplements are more and more important to our health and must be kept available as cheaply as possible.

Pay attention.

In reply to by bonin006

ali-ali-al-qomfri Save_America1st Fri, 12/15/2017 - 21:01 Permalink

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found this in Webster'sDefinition of Shkreli 1 : a pencil necked weasel with a tenacious ability to screw people . 2 : the act of raising prices without giving a shit. 3 : an excessive or improper charge for something : extortion  

In reply to by Save_America1st

Not Too Important Miffed Microbi… Fri, 12/15/2017 - 18:38 Permalink

Speaking of, somebody just got busted at the Mexican border with a car full of 80 pounds of Fentanyl. It's worth tens of millions of dollars once it's on the street. Dirt cheap from China.

So, what's to say some well-funded Anti-fascist group has their members who work in restaurants start putting it in people's food? Or workers in food processing plants?

Obviously the FBI doesn't give a shit, as long as it kills Trump supporters. Well, they don't give a shit about a lot of collateral damage, either, so...

In reply to by Miffed Microbi…

Mr Hankey Fri, 12/15/2017 - 18:19 Permalink

'Murica!!!!!FUCK YEAH!!!!!!!coming agin,to save the mutherfuckin day YEAH!!!!USA!!!!!USA!!!!!!USA!!!!!$$$$$$$$$$$$$$$$$$$$$$$$$#$$!!!!!!!!$$$$$$NASCAR!!!!!!!!!!!BACON DOUBLE CHEESEBURGERS!!!!!!!!!SLO-MO FLAPPIN' FLAGWANKING!!!!EAGLES!!!!!!!!DIABETES!!!!!!!!!!!!$$$$$$$$$$$!!!!!!!%$$$$$$$$$$$# PUT SOME MORE SUNOCO FUEL IN THAT LILLY DIABETES CAR!!!!!!!!!!!!!!$$$%$$#$$$$%$$$$$$$$#$

Miffed Microbi… Fri, 12/15/2017 - 18:20 Permalink

Vitamins, particularly synthetic ones, are pretty useless to take. I worked at a lab studying the absorbability of many popular brands and they were practically undetectable in the body. Total waste of money.

Miffed

Miffed Microbi… Nobodys Home Fri, 12/15/2017 - 19:13 Permalink

When I worked at that lab I ran vitamin assays on Mr Miffed and myself just to see where we stood. Retinol, alpha and beta carotenes were excellent but we both were low in coQ10 and Mr was severely deficient in lycopene. Our minerals and amino acid profiles were good. We weren't on any supplements but just ate a basic diet. Afterwards I supplemented with Ubiquinol ( reduced form of CoQ10 ) and put a lot of tomato paste and sauce in Mr's diet. His lycopene levels came up.

Today I take liposomal C, D, CoQ10 and curcumin, turmeric with bioperine and multi collagen protein as my main supplements. I do make a daily green smoothie that has He Shou Wu, chlorella, spirulina and reishi mushroom in it. Keeps me mentally sharp imho but Mr says it makes me bounce of the walls.

I had an advantage seeing where we were deficient at the time. I think you can individually supplement but I would be careful if you are dealing with a substance that could be toxic if levels go too high. Many labs do offer amino acid profile tests if you are interested.

Remember above all things food is thy medicine.

Miffed;-)

In reply to by Nobodys Home

Common_Cents22 Fri, 12/15/2017 - 18:34 Permalink

let the free market decide.  if you are too dumb to buy generic you deserve to be fleeced.  what about the doctors who prescribe this to you and don't tell you about generic????  what about the pharmacy who didn't warn you???