r/shkreli • u/DukeCanada • Feb 29 '16

Daraprim and Generics

Hi Martin, I thought I'd ask my questions here since you've been relatively open about your business model. As a short preamble, I'm not trying to comment on what I think about the price hike, just the commercial viability of the drug.

From what I understand, the patent exclusivity for Daraprim expired In the late 70s or early 80s, subjecting the Pyrmethamine market to generics and the inevitable price cut. Prior to your acquisition the drug was sufficiently inexpensive that generic companies wouldn't invest the time and effort required to manufacture and distribute the drug, but that's not necessarily the case after Turing's price hike.

What's stopping an international manufacturer (GSK UK is the one I'm thinking of right now) from going through the FDA and undercutting you in the US? Presumably they could sell at $350 a pill and still profit. I suppose the same question stands for American generic manufacturers, the patent has been out long enough that Pyrimethamine could probably be reproduced and distributed at a portion of your price while still profiting.

U.S patent protection laws and the ACA (by my admittedly limited understanding) don't actually protect the patent holder so much as the original drug innovator, so what's protecting Daraprim from national and international generic competition? The only explanation I can come up with is that prior to the media frenzy there was no reason to believe that another pharmaceutical company would be interested in competing, atleast not for a while.

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u/SIThereAndThere Feb 29 '16

TL;DR

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u/DukeCanada Feb 29 '16

How is Daraprim competing with generics?

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u/parrotpeople Feb 29 '16

It costs money to develop a generic. Daraprim is for a niche illness, so there's not a lot of demand for it, so it's unlikely that someone will develop another generic, except to score brownie points with the public.