Martin Shkreli and the Imbeciles

 

martin shkreliIt’s not often that I say, “Thank God the New Yorker cut right through all this leftist cant,” but let’s give them credit where it’s due. On this one, they’re exactly right. Everyone hates Martin Shkreli and everyone’s missing the point:

But was Shkreli’s performance actually more objectionable than that of the legislators who were performing alongside him? Elijah Cummings, of Maryland, is the ranking Democrat on the committee, and he used his allotted time to deliver a scolding. … Cummings acted as if Shkreli were the only thing preventing a broken system from being fixed. “I know you’re smiling, but I’m very serious, sir,” he said. “The way I see it, you can go down in history as the poster boy for greedy drug-company executives, or you can change the system—yeah, you.” Cummings has been in Congress since 1996, and he is a firm believer in the power of government to improve industry through regulation. And yet now he was begging the former C.E.O. of a relatively minor pharmaceutical company to “change the system”? …

The Republican-led committee was no more impressive. As if to establish that Turing was unnecessarily profitable, the committee released documents showing that the company had thrown a lavish party—fireworks included—and given some executives six-figure raises. (If this now counts as corporate behavior worthy of oversight and reform, the committee may soon find its schedule overbooked.) And then there was John Mica, a Republican from Florida, who has vowed to “keep the government out of patients’ sick beds.” Notwithstanding his skepticism of government intervention, he expressed alarm that some drug prices have “skyrocketed.” Even more than his colleagues, he seemed taken aback by the star witness’s recalcitrance, as if he couldn’t fathom why a private citizen wouldn’t be more deferential to his government—at one point, he threatened to move to hold Shkreli in contempt.

The Daraprim saga has as much to do with the Food and Drug Administration as with Shkreli: although the drug’s patent expired in the nineteen-fifties, the F.D.A. certification process for generic drugs is gruelling enough that, for the moment, whoever owns Daraprim has a virtual monopoly in America. (Overseas, it is much cheaper.) [My emphasis] …

Most of our Presidential candidates claim to disdain Washington politicians, but, on Thursday, Shkreli put that disdain into practice—and helped illustrate, to anyone paying attention, why it is so richly deserved.

The New Yorker’s conclusion is, I assume, meant ironically:

He is the American Dream, a rude reminder of the spirit that makes this country great, or at any rate exceptional. Shkreli for President! If voters in New Hampshire are truly intent on sending a message to the Washington establishment they claim to hate, they could—and probably will—do a lot worse.

Nah. You can view Shkreli’s performance as intellectually more consistent, morally more defensible, and less contemptuously disdainful of our intelligence than Congress’s and see Shkreli as a distasteful personality. But on the merits of it, anyone who sees Shkreli as the problem — as opposed to the F.D.A. certification process — is indeed an imbecile. Anyone who blames Shkreli for the high price of this drug instead of blaming those with the power to rein in the FDA and change this situation — to wit, Congress — is indeed an imbecile.

Shkreli scandalized America by saying it was hard to accept that these imbeciles represent the people in our government. No, it’s easy to accept that. What’s hard to accept is that these imbeciles do indeed represent the people.

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  1. Capt. Aubrey Inactive
    Capt. Aubrey
    @CaptAubrey

    The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli. It behooves them to go on TeeVee and engage in this imbecile bombast much more than to actually take action and reform the FDA. The financial crisis could be looked at the same way.

    • #1
  2. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    • #2
  3. EJHill Podcaster
    EJHill
    @EJHill

    Claire – C-SPAN is as much as a curse as it is a blessing. There is no such thing as “reality television.” Once you introduce cameras into anything the process changes.

    These committee hearings become a peacock fight. Politicians and witnesses alike fan the tail feathers, preen and prance and try to woo the world. Stop the show. There is no evidence that government is more honest or transparent in the era of C-SPAN than it was before.

    • #3
  4. Adriana Harris Inactive
    Adriana Harris
    @AdrianaHarris

    Claire Berlinski, Ed.:

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    We fire them and send them home to live in the system they created.

    • #4
  5. St. Salieri Member
    St. Salieri
    @

    Adriana Harris:

    Claire Berlinski, Ed.:

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    We fire them and send them home to live in the system they created.

    But they don’t have to live in our system, and we are beginning to realize how true that is … hence Trump/Sanders (who wouldn’t in my opinion do anything but make it worse).

    As this shows, the guys on “our side” are just as happy with the posturing, non-reforming, nonsense as theirs.  They both come out of congress to enjoy the post-Congressional lifestyle, and that is the problem.

    There is no incentive for them to change themselves or the system as represented by Congress/FDA at present.

    • #5
  6. St. Salieri Member
    St. Salieri
    @

    You know, here is one of those things a candidate could glam onto – a Cruz, Rubio, some other than Trump – a real reform that people could understand in their daily life.  A nonpartisan moment, a real moment, oh so teachable, about the corruption of Government power and how it enables the sort of corporate behavior (which is rational if distasteful) that so many Americans see as hateful.

    Claire has laid it out with the aid of The New Yorker for Heaven’s sake, and we’ll just hear the crickets in Maracaibo instead.

    • #6
  7. dittoheadadt Inactive
    dittoheadadt
    @dittoheadadt

    Claire Berlinski, Ed.:

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    Term limits constitutional amendment?

    • #7
  8. Western Chauvinist Member
    Western Chauvinist
    @WesternChauvinist

    Pee Wee Herman runs a drug company?

    • #8
  9. Songwriter Inactive
    Songwriter
    @user_19450

    Adriana Harris:

    Claire Berlinski, Ed.:

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    We fire them and send them home to live in the system they created.

    Term limits. No more career politicians.

    • #9
  10. RightAngles Member
    RightAngles
    @RightAngles

    Songwriter:

    Adriana Harris:

    Claire Berlinski, Ed.:

    Capt. Aubrey: The Congressmen are acting in a system with incentives as perverse as those that the FDA has created for Shkrelli.

    Yes. Good point. How do we change their incentives?

    We fire them and send them home to live in the system they created.

    Term limits. No more career politicians.

    Send every last one of them home and start over. New Broom. Sweep clean.

    • #10
  11. MarciN Member
    MarciN
    @MarciN

    EJHill:Claire – C-SPAN is as much as a curse as it is a blessing. There is no such thing as “reality television.” Once you introduce cameras into anything the process changes.

    These committee hearings become a peacock fight. Politicians and witnesses alike fan the tail feathers, preen and prance and try to woo the world. Stop the show. There is no evidence that government is more honest or transparent in the era of C-SPAN than it was before.

    When our town decided to televise our school committee meetings, I witnessed the funniest transformation of people I had known well for many years.

    I think televising all levels of government is a good thing though. Even when no one is watching, the people on camera feel watched. If nothing else, it helps committees maintain some decorum. And there is this vague sense among the participants that there is a permanent record, so that adds some seriousness to the proceedings, in and of itself.

    Although it attracts grandstanding, I think that is a price worth paying to see people take what they are doing seriously, prepare better, and think before they speak.

    • #11
  12. David Sussman Podcaster
    David Sussman
    @DaveSussman

    Shkreli achieved the impossible: he made congress look like the good guys.

    • #12
  13. RightAngles Member
    RightAngles
    @RightAngles

    David Sussman:Shkreli achieved the impossible: he made congress look like the good guys.

    And now he’ll be the poster boy for single payer health care. We just might be seeing his face in Bernie/Hillary campaign commercials. sigh

    • #13
  14. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    RightAngles: And now he’ll be the poster boy for single payer health care. We just might be seeing his face in Bernie/Hillary campaign commercials. sigh

    How could anyone in possession of the information in this story conclude that what we need is more government involvement in this? There is no shortage of inexpensive Daraprim on this planet! All the FDA has to do is say, “Import as much as you need, at your own risk.” Cheap Daraprim would flood to patients via FedEx the very next day. I can’t believe that no one in Congress understands this — or that they pretend not to understand this — and I can’t grasp how the public doesn’t understand it. What’s the cognitive problem? There is no shortage of Daraprim, they’re just not letting it into the country. 

    • #14
  15. Crow's Nest Inactive
    Crow's Nest
    @CrowsNest

    Claire Berlinski, Ed.:

    RightAngles: And now he’ll be the poster boy for single payer health care. We just might be seeing his face in Bernie/Hillary campaign commercials. sigh

    How could anyone in possession of the information in this story conclude that what we need is more government involvement in this?

    Silly Claire. If there was single-payer healthcare, there’d be no profit motive–so he couldn’t jack up the price and swindle the poor sick people.

    Scarcity you say? Long lines you say? Poorer quality care? Trouble recruiting doctors? Having to buy something as simple as aspirin at a chemist instead of your corner store? Nonsense! #fairness

    • #15
  16. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    Crow's Nest:

    Scarcity you say? Long lines you say? Poorer quality care? Trouble recruiting doctors? Having to buy something as simple as aspirin at a chemist instead of your corner store? Nonsense! #fairness

    Serious question: Why aren’t the patients who need this drug ordering it from India? It costs ten cents a dose there. Everything I know about economics tells me the US should by now have a huge black market in Daraprim. Can’t do it because you’ll go to jail? Come on. As if that ever stopped anyone from bringing drugs over the border before? Indians are really resourceful. This is the age of the Internet. You can get online, meet a nice Indian pharmacist who needs some cash, and ask him to send it to you. He’ll do it: He wants your business.

    The only thing standing between people and that drug is lack of initiative and, I suspect, racism. Because only the belief that Indians can’t make drugs as well as Europeans and Americans allows the FDA to get away with keeping Indian drugs off the US market.

    • #16
  17. Four Finger Wu Inactive
    Four Finger Wu
    @MrFrench

    Claire — regarding the no shortage of Daraprim, do you remember the “gas crisis” of the Nixon 1970’s?

    • #17
  18. RightAngles Member
    RightAngles
    @RightAngles

    Four Finger Wu:Claire — regarding the no shortage of Daraprim, do you remember the “gas crisis” of the Nixon 1970’s?

    The Carter 1970s!

    • #18
  19. Crow's Nest Inactive
    Crow's Nest
    @CrowsNest

    Claire Berlinski, Ed.:The only thing standing between people and that drug is lack of initiative and, I suspect, racism. Because only the belief that Indians can’t make drugs as well as Europeans and Americans allows the FDA to get away with keeping Indian drugs off the US market.

    I don’t think I would qualify it as racism so much as a lack of familiarity or fear of the unknown. Lots of Americans aren’t world travels who are happy to play food chicken with street meat in Morocco (or have never eaten street meat, or have never been to Morocco….you get my point), never mind imbibe drugs from the subcontinent. What quality controls are in place, they ask?

    Now, if the drug is available in Canada for less, why isn’t the same effect we’re seeing in the market for opiates or viagra at play? Good question.

    • #19
  20. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    Crow's Nest:

    I don’t think I would qualify it as racism so much as a lack of familiarity or fear of the unknown. Lots of Americans aren’t world travels who are happy to play food chicken with street meat in Morocco (or have never eaten street meat, or have never been to Morocco….you get my point), never mind imbibe drugs from the subcontinent. What quality controls are in place, they ask?

    The overwhelming majority of people who need Daraprim in the US are people who are HIV-positive. The overwhelming majority of that population are people whose lives have not been characterized by risk-aversion. You’d have a better chance of persuading me that the hesitant consumers were well-meaning but unsophisticated small-town folk who merely feared the unknown if the drug in question were Maalox.

    Now, if the drug is available in Canada for less, why isn’t the same effect we’re seeing in the market for opiates or viagra at play? Good question.

    No, the question really is why people would trust Canadian pharmaceuticals over Indian ones when India, not Canada, is the world’s pharma powerhouse.

    • #20
  21. Crow's Nest Inactive
    Crow's Nest
    @CrowsNest

    Claire Berlinski, Ed.:The overwhelming majority of people who need Daraprim in the US are people who are HIV-positive. The overwhelming majority of that population are people whose lives have not been characterized by risk-aversion. You’d have a better chance of persuading me that the hesitant consumers were well-meaning but unsophisticated small-town folk who merely feared the unknown if the drug in question were Maalox.

    Fair point on risk aversion and HIV. However, it might well be that the man who acts with reckless abandon in a moment of exuberant health is, later, risk averse when the full weight of his disease comes home to him. He may prefer the “known good”, even if financially ruinous, to the unknown in that case–the assurance in a moment of desperation.

    Claire Berlinski, Ed.:No, the question really is why people would trust Canadian pharmaceuticals over Indian ones when India, not Canada, is the world’s pharma powerhouse.

    You’re assuming that the consumer is worldly and well read enough to know that India is the world’s pharma powerhouse.

    I honestly don’t know why we don’t have a large black market in the drug. But I am trying to find explanations that make some sense of this. I don’t rule out racism as a possibility, but I have a hard time believing that, on a large enough scale to be measurable, men on their deathbeds would cling to such petty hatreds over any hope, false or no.

    • #21
  22. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    Crow's Nest: I don’t rule out racism as a possibility, but I have a hard time believing that, on a large enough scale to be measurable, men on their deathbeds would cling to such petty hatreds over any hope, false or no.

    It’s not that they cling to petty hatreds, it’s that they’re more easily persuaded than any evidence suggests they should be that Indian drugs are unsafe.

    • #22
  23. Midget Faded Rattlesnake Contributor
    Midget Faded Rattlesnake
    @Midge

    Claire Berlinski, Ed.:Serious question: Why aren’t the patients who need this drug ordering it from India? It costs ten cents a dose there. Everything I know about economics tells me the US should by now have a huge black market in Daraprim. Can’t do it because you’ll go to jail? Come on. As if that ever stopped anyone from bringing drugs over the border before?

    Speaking just for myself, yes the fear of going to jail or getting into some sort of legal trouble is probably the deciding factor. Not for Daraprim specifically, but certainly for acquiring other prescription drugs that can be had cheaper overseas.

    People who are into street drugs are probably cooler about breaking the law in the first place. For squares like me, though… well, no matter how silly I may consider our drug laws to be in the abstract, the stigma of being caught “dealing drugs”, even if the drugs are obviously no fun at all, actually does serve as a deterrent.

    • #23
  24. Midget Faded Rattlesnake Contributor
    Midget Faded Rattlesnake
    @Midge

    Claire Berlinski, Ed.: The overwhelming majority of people who need Daraprim in the US are people who are HIV-positive. The overwhelming majority of that population are people whose lives have not been characterized by risk-aversion.

    That is true enough. So, lack of imported Daraprim by itself ought to be hard to explain due to mere risk-aversion or “squareness”.

    We used to have an urgent care clinic nearby with its own dispensary, run by a nice Pakistani pharmacist who’d sometimes acquire more expensive or difficult-to-find pharmaceuticals from India or Pakistan. I was fine having him dispense those to me. I would still be nervous about placing an online, border-crossing order with some supplier whose reputation could by its very nature not be rated publicly. (Of course there are internet fora where people rate these suppliers informally, but if you’re an outsider to these fora, how do you know which forum to trust?)

    Of course, the more of us risk-averse people who were willing to brave our own government’s disapprobation and order from overseas, the more infrastructure there’d be in place to import Daraprim, too.

    • #24
  25. Percival Thatcher
    Percival
    @Percival

    I object to buying much of anything for sale online that is either not delivered digitally (software, music, books) or something within my core competencies (computers and related hardware). Even with computers, I’ve been burned – or rather singed – in the past.  That was due to a cracked video board and attributable to bad luck, not malfeasance.

    Drugs would freak me out. Though I might check with the son of the Nigerian Minister of Finance.  He might be able to set me up. He owes me.

    • #25
  26. TheRoyalFamily Member
    TheRoyalFamily
    @TheRoyalFamily

    India has a reputation – deserved or not – of low-quality stuff. I figure the most exposure most people have to India is outsourced, unhelpful tech support. Your average American (even one desperate with AIDS) is probably not going to be too trusting of imported Indian drugs, perhaps thinking that, like cheap Chinese crap, or even street drugs, you get what you pay for. That, and India still has the image of being a third world country, and “sophisticated” folks don’t think good things can come from there, especially when they can’t handle their own health problems (even though those problems come as much from culture as from poverty); there’s a UNICEF campaign to get people to poop in toilets and not on the streets, for goodness sake.

    And then add on the fact that it’s highly illegal to import these drugs, combine that with the fact that there isn’t so much of a market for them that your usual illicit drug importers won’t bother with it (for some reason it’s easier to trust your local pusher than a company on the internet), and it’s not surprising that there is a lack of a general black market for this stuff.

    • #26
  27. Crow's Nest Inactive
    Crow's Nest
    @CrowsNest

    Claire Berlinski, Ed.:

    It’s not that they cling to petty hatreds, it’s that they’re more easily persuaded than any evidence suggests they should be that Indian drugs are unsafe.

    What accounts for the ease with which they are persuaded?

    My guess is something along these lines. You might call this prejudice of a kind, though I think racism is a bit far:

    TheRoyalFamily:India has a reputation – deserved or not – of low-quality stuff. I figure the most exposure most people have to India is outsourced, unhelpful tech support. Your average American (even one desperate with AIDS) is probably not going to be too trusting of imported Indian drugs, perhaps thinking that, like cheap Chinese crap, or even street drugs, you get what you pay for.

    • #27
  28. Zafar Member
    Zafar
    @Zafar

    In Australia when you take a scrip to the pharmacist you’re asked whether you would prefer the generic version of the drug (if available). Saying yes can mean paying one quarter of what you otherwise would have. Quite often the generic is made in India (and it says so on the package).

    But this is because of how pharmacies are regulated in Australia, so not a direct result of an untrammelled free market.

    • #28
  29. Arizona Patriot Member
    Arizona Patriot
    @ArizonaPatriot

    Great post, Claire.  To summarize:

    1. Congress creates FDA
    2. FDA rules give this guy a monopoly
    3. This guy acts like a monopolist and raises prices
    4. Congress complains about the price increase it created
    • #29
  30. Claire Berlinski, Ed. Editor
    Claire Berlinski, Ed.
    @Claire

    Midget Faded Rattlesnake: People who are into street drugs are probably cooler about breaking the law in the first place. For squares like me, though…

    So much of this story has me seething, but what burns me especially is that we’ve set up a situation in which one cannot be moral without being a criminal. If your life depended on this drug and you couldn’t afford to pay $750 for the American version — but could readily afford the cost of the Indian generic — it would be actively immoral for you to fail to break the law.

    This story angers me out of proportion, because I believe it’s an absolutely conscious swindle and it’s obviously the path most Americans want to go down even further. I believe the FDA is wittingly acting to protect our domestic pharma industry — it’s beyond all imagination that they don’t know these drugs are available in India and that India supplies the rest of the world’s generic drugs. With most of the front-running candidates committed to some kind of protectionist platform and to providing “free health care for everyone,” it seems as if the majority of Americans want insane policies like these. So these stories of drug rationing and shortages are just the beginning: Americans will soon start dying in notable numbers of completely treatable and preventable diseases — and they’ll be dying of our own stupidity and corruption, and nothing I say can stop it.

    I wish this jerk Shkreli would use his celebrity to spell out the steps of this argument. If he did, yes, I’d say, “Shkreli for president.”

    • #30

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