Make us your home page
Instagram

Congress unites in scorn for Shkreli, but gridlock remains

Former Turing CEO Martin Shkreli was mostly mum in a hearing.

Former Turing CEO Martin Shkreli was mostly mum in a hearing.

WASHINGTON — A smirking Martin Shkreli briefly united Democrats and Republicans on Capitol Hill this week, as lawmakers took turns blasting the price-hiking former drug company CEO who has become the new poster child for corporate greed.

But the gridlocked state of Congress virtually assures federal efforts to lower drug prices will remain in limbo for years. And even then, experts warn that the options available to Congress would not stop companies like Turing Pharmaceuticals, where Shkreli engineered a 5,000 percent price increase of a critical anti-infection drug.

For now, experts say the most lawmakers can do is give price-gouging executives a verbal lashing before their committees. Richard Evans, a pharmaceutical analyst for SSR, says that won't be enough to deter some companies.

"If you're willing to take a public shaming … then you can take the price increase," he said.

Lawmakers from both sides of the aisle took their best rhetorical shots at Shkreli on Thursday, but he was mostly mum. The 32-year-old entrepreneur repeatedly declined to answer questions, citing his Fifth Amendment right to avoid self-incrimination. When lawmakers suggested that legal defense shouldn't stop him from talking about his tenure as Turing's CEO, Shkreli retorted: "I intend to follow the advice of my counsel, and not yours."

Shkreli faces securities fraud charges in New York unrelated to Turing.

Concerns about sky-high drug prices have been building for years but boiled over this fall after stories about Turing and Canadian drugmaker Valeant Pharmaceuticals hiking prices for previously low-priced medicines for patients with heart problems and other life-threatening conditions.

Many pharmaceutical companies increase prices annually as a matter of doing business. But the staggering size of the hikes by Turing and Valeant drew congressional interest. Valeant bought two lifesaving heart drugs last February and promptly hiked their prices, tripling one and raising the other sixfold.

It's an approach that's attracted unprecedented media coverage and seemed to confirm the public's worst fears about pharmaceutical companies: that they are more Wall Street-driven investment vehicles than actual developers of medicines.

But industry analysts have repeatedly reminded investors that the chances for real action to curb prices is low.

"Congressional Republicans, the majority in both houses of Congress, oppose regulating drug pricing and will stop all attempts by congressional Democrats to do so," Evercore ISI analyst Terry Haines advised clients recently.

Even with major changes to programs like Medicare, analysts say there would still be little to stop companies from hiking prices of drugs when they are the sole provider, as in the case of Turing and Valeant.

Congress unites in scorn for Shkreli, but gridlock remains 02/05/16 [Last modified: Friday, February 5, 2016 10:14pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Triad Retail Media names Sherry Smith as CEO

    Corporate

    ST. PETERSBURG — Triad Retail Media, a St. Petersburg-based digital ads company, said CEO Roger Berdusco is "leaving the company to pursue new opportunities" and a member of the executive team, Sherry Smith, is taking over.

    Roger Berdusco is stepping down as CEO at Triad Retail Media to pursue other opportunities. [Courtesy of Triad Retail Media]
  2. Two new condo projects for same street in downtown St. Pete

    Real Estate

    ST. PETERSBURG — It lacks the panache and name recognition of Beach Drive, but 4th Avenue N in downtown St. Petersburg is becoming a condo row in its own right.

    Bezu, a condo project planned at 100 4th Ave. N in downtown St. Petersburg, will have 24 units including a three-level penthouse with infinity pool.
[Courtesy of Clear ph Design]
  3. AAA expects gas prices in Tampa Bay will continue to fall

    Autos

    Ticking slowly and steadily, regular gas prices have receded for the last 10 consecutive days. The average unleaded gas price in Florida is $2.67 this morning, a nickel cheaper than a week ago. In Tampa Bay, the current average unleaded gas has dropped 7 cents from a week ago to $2.62. The national average for regular …

    Gas prices for regular gas continue to decline. In Tampa Bay, the current average unleaded gas is down 7 cents from a week ago at $2.62 a gallon. [Times file photo]
  4. Kiran and Pallavi Patel commit $200 million for Clearwater medical school

    Real Estate

    CLEARWATER — Tampa Bay philanthropists Dr. Kiran Patel and his wife, Dr. Pallavi Patel are spending $200 million to create and promote a Tampa Bay regional campus for the private Nova Southeastern University.

    Drs. Kiran and Pallavi Patel, prolific Tampa Bay philanthropists, are putting up $200 million to create and run a new medical school under Nova Southeastern University. Here is a rendering of the proposed campus [Courtesy of Nova Southestern University}
  5. USF to rename sports management program for Vinik family

    Blogs

    The University of South Florida will name a business program for the Vinik family at a Tuesday event.

    Tampa Bay Lightning owner and chairman Jeff Vinik and his wife, Penny, in 2010.