Stocks of makers of biologic and “specialty” drugs plunged Monday after Democratic presidential front-runner Hillary Clinton said she’ll soon release a plan to address “price gouging” in the industry.
It was one of the worst days of the year for the stock market performance of the biotech industry.
Clinton’s announcement on Twitter followed news that drugmaker Turing Pharmaceuticals in August hiked the price of Daraprim, a 53-year-old drug for toxoplasmosis, a potentially deadly parasitic infection, to $750 per pill from $13.50.
The top 20 drugmakers whose products include biologic or specialty drugs posted share drops of more than 2 percent. The Nasdaq Biotechnology Index dropped 4.4 percent.
Biologic drugs are produced in living cells, and specialty drugs treat complex, chronic conditions. They are very expensive.
Many new drugs for cancer, hepatitis C, rare disorders and even a new class of cholesterol drugs have prices in the range of $80,000 or more for a year or a course of treatment. Some are major medical advances, saving lives and other medical costs. Others are minor improvements, such as cancer drugs that add a few months of survival over existing medicines.
So while the Turing price hike was getting the blame Monday for the stock slump, it’s only the latest — although perhaps most outrageous — example of price hikes or sky-high prices for newly launched drugs. Insurance companies, politicians, advocates for patients and other critics have been blasting those prices as outrageous and unsustainable for the health care system and patients paying up to 30 percent of the cost.
Vermont Sen. Bernie Sanders, Clinton’s chief rival for the Democratic nomination, has been railing about high drug prices for about a year and recently reintroduced legislation that would enable the Medicaid program to get lower prices for some drugs and allow U.S. residents to buy cheaper drugs from Canada.
Although their stock prices rarely move more than 1 percent in a day, the top 20 drugmakers took significant hits Monday.
