The EpiPen Scandal Is Pharma's Vision for America

Mytheos Holt
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Posted: Sep 15, 2016 12:01 AM
The EpiPen Scandal Is Pharma's Vision for America

If you want to see corporate welfare and cronyism in action, there is no better place to look than the pharmaceutical industry. Having more or less treated Obamacare as a wishlist, then hired the architect behind it, then turned Hillary Clinton into their personal puppet, Big Pharma has less shame about gaming the system than Clinton does about using Bleachbit.

But however repulsive pharma's behavior is, there is one bright side to it. At a certain point, corruption becomes a problem not merely from an ethics standpoint, but because corrupt companies become blind to the very market signals that tell them when they're on the verge of terrible mistakes.

Exhibit A: The scandal over EpiPen price gouging, which hit the media last month and has continued to be a thorn in the side of the industry as more information surfaces. 

For those living under a rock, Mylan, the company responsible for manufacturing EpiPen injections, has increased the price for the life-saving drug by huge margins -- sixfold, in fact. This is not merely callous, but also stupid, as the medication contained in EpiPens is off-patent, meaning that generic manufacturers could easily sell it cheaper and outcompete Mylan. In this respect, the scandal bears a striking resemblance to the similar Daraprim pricing scandal perpetrated by the infamous "Pharma bro" Martin Shkreli. 

And unlike Shkreli, who seems to be an outlier because he's essentially a professional troll, Mylan's CEO has a much more problematic background: She's the daughter of Democratic Sen. Joe Manchin. Small wonder, then, that the Wall Street Journal has laid the blame for EpiPen's continuing price hikes at the door of the federal government. Crony capitalism is funny that way.

But this connection to Manchin is troubling for another reason as well: It shows that the kind of inhumane price hikes that Shkreli made infamous are not merely exclusive to malcontents like him. They are an increasingly common practice among pharmaceutical executives, many of whom clearly feel confident in being able to hide behind their connections -- in Mylan's case, a very intimate connection indeed -- to the Democratic party. 

To conservatives who follow healthcare, this is not news. Nevertheless, the EpiPen pricing scandal is revealing about the world pharma wants to live in. It is particularly enlightening in light of the fact that they want to get rid of the pro-taxpayer 340B drug pricing program, which holds down the cost of drugs for vulnerable patients as a condition of giving taxpayers' Medicaid and Medicare Part B dollars to pharmaceutical companies. Conservatives might regard this as a worthy cause, considering that, if you squint, the voluntary program looks like a price control. But when you consider the other things pharma does, as embodied by the EpiPen price hikes, it reveals it is no friend to conservatives at all.

Rather, the drug industry’s ideal world is one in which its connections to Democratic politicians provides it with an ever increasing amount of taxpayer money. It’s also a cozy political cocoon in which to hide from scrutiny while it engages in blatantly anti-consumer behavior. It is a world where the response to the EpiPen scandal is not to question, as Sen. Susan Collins nobly did, the industry's behavior, but rather to simply whimper "Thank you sir, may I have another?"

Top Democrats have already sold their souls to pharma, so we can't expect them to stop this agenda. But there is no reason for conservatives to roll over for it.