Valeant, Turing slammed for price hikes during congressional hearing

Martin Shkreli

Industry watchers expected a show at Thursday's congressional drug price hearing, and the event did not disappoint. Members of Congress slammed Valeant ($VRX) and Turing Pharmaceuticals for dramatic prices increases, and also took shots at former Turing CEO Martin Shkreli, who remained close-lipped throughout the hearing.

Rep. Elijah Cummings (D-MD), the top Democrat on the House Committee on Oversight and Government Reform, chastised Valeant and Turing for buying meds and then raising prices for their own financial gain.

"They bought them, jacked up the prices, took as much money as they could out of the pockets of patients, hospitals and others, and then put those funds into their own coffers," Cummings said, as quoted by Bloomberg.

Back in August, Turing bought toxoplasmosis drug Daraprim and raised its price by 5,000%, drawing backlash from lawmakers and presidential hopefuls including Hillary Clinton. Valeant has also come under fire for price increases, especially for the two cardio drugs Isuprel and Nitropress. The company raised the drugs' prices by 525% and 212%, respectively, after purchasing the meds from Marathon Pharmaceuticals.

Unsurprisingly, Shkreli did not respond to Cummings' remarks, invoking his Fifth Amendment right as predicted due to his involvement in an unrelated securities fraud case. But Cummings still had a few words for the ex-CEO, who sat silent and smiling during his speech.

"I'm know you're smiling but I'm very serious, sir," Cummings said. "You have a spotlight and you have a platform. You could use that attention to come clean, to right your wrongs and to become one of the most effective patients' advocates in the country and one that can make a big difference in so many people's lives."

Upon being excused after his testimony, Shkreli broke his silence via Twitter. "Hard to accept that these imbeciles represent the people in our government," Shkreli tweeted, sparking outrage from a few members of the committee, including Chairman Jason Chaffetz (R-UT).

Turing Chief Commercial Officer Nancy Retzlaff

Lawmakers had pointed questions for Nancy Retzlaff, Turing's chief commercial officer. Retzlaff said in written testimony prior to the hearing that Turing reduced Daraprim's price by 50% in November, and that some of the company's profits from the drug would be channeled into R&D.

But Congress saw things in a different light. Chaffetz grilled Retzlaff about Turing spending money on yacht parties and pay raises, even as it said it would invest more dollars in R&D.

"Don't come before the American people and cry and shed a tear and say we're not making any money," Chaffetz said, as quoted by Bloomberg. "If you're going to continue to lie to the American people, then Congress is going to continue to probe."

Valeant did not fare much better during the hearing. Interim CEO Howard Schiller acknowledged at the hearing that the company had made mistakes but said "we're listening and we're changing." He told the committee the company would raise drug prices in the future "within industry norms, and much less than" it did for Isuprel and Nitropress.

But another committee member, Rep. Carolyn Maloney (D-NY), wasn't buying Valeant's excuses.

"The only strategy I saw was, 'Let's increase the price of the drugs,'" Maloney said about the company's price hikes.

- read the Bloomberg story

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