It is an interesting case of arrogance, where an executive’s “moral requirement” to raise the price of a pharmaceutical 400% has enraged the director of the FDA, and medical professionals everywhere. Is it possible that Nirmal Mulye is confusing morality 
with ethical behavior?
Nostrum Pharmaceuticals
Nostrum Pharmaceuticals founder and president is Nirmal Mulye, and he has recently distinguished himself by two things: raising the price of an antibiotic from $500 per bottle to $2,300 per bottle, and defending pharmaceutical company head Martin Shkreli (now in jail) for gouging the price of an AIDS drug by more than 5,000%
Of the first point, Mulye is quoted as saying:
“I think it is a moral requirement to make money when you can, and to sell the product for the highest price.”
In terms of Martin Shkreli, Mulye said:
“I agree with Martin Shkreli that when he raised the price of his drug he was within his rights because he had to reward his shareholders.”
The statement is what prompted FDA Commissioner Dr. Scott Gottlieb to say: “there’s no moral imperative to price gouge and take advantage of patients. The FDA will continue to promote competition so speculators and those with no regard to public health consequences can’t take advantage of patients who need medicine”
To be fair, Mulye fired back to Gottlieb’s statement and said:
“The word morality was used in the conversation, but not in the context of price increases. I said I have to raise prices when I can — how to get the best prices for my products, so that I can survive. It is about the survival of the business. It has nothing to do with morality.”
However, he went on to clarify his clarification:
“Is it moral for me to lose money?” If I don’t make money, then I can’t create those jobs. And where does the money go when I make it? It goes back into research and hiring new people right here in the US.”
He then turned around and blamed the FDA for its stifling regulations. In an email to Gottlieb, Mulye stated:
“Basically, I said in a nutshell that he (Gottlieb) does not have the necessary competence to comment on the morality of drug price increases, which is a complex subject…Gottlieb should stay away from tweet (Twitter), and he needs to stay in his office and listen to people like me and reform the agency.”
Mulye feels he is being “vilified” and that the FDA doesn’t understand how drug pricing works. At one point, Mulye likened his role to that of a fine art dealer who sells Van Gogh or a Rembrandt at the highest possible price.
All of a sudden, drug pricing has left the arena of research, development and marketing costs and entered the realm of ethics.
If the FDA and pharmaceutical companies are at loggerheads, there may be some very good reasons for it. The people in the middle, you and me, suffer as the result of their finger-pointing and indignation.
No Fine Art
We can start this discussion with an observation about Mulye’s comments: a Van Gogh original may sell for $50 million or more. I am sure there are many art critics and art dealers who are able to offer an explanation as to why. Then again, you can probably go to any number of online or brick and mortar locations and buy a decent, framed reproduction of the same painting for $250. For most of us, the $250 version is just fine, thank you. The aesthetics of it all, the appreciation for the skill of the artist will still reflect itself in the copy.
The “original pharmaceutical” may have cost millions to research and develop, and there is no doubt that Big Pharma will spend millions to promote it (legally and sometimes, under the table), but how much is it really worth once it goes generic?
In Mr. Mulye’s world, it seems as though his comments on morality versus profitability is still the same argument. At what point is his “profitability” argument an immoral argument? While a Van Gogh original hung in a museum or a copy tacked above our desk can stir the soul and make the moments we look at it turn to joy or happiness, if we are sick, it will not save us, cure us, heal us or relieve us. A pharmaceutical will.
No one argues that an art dealer can command a high price for an original oil. We should however, argue when a drug that can be replicated over and over again, experiences a 1000% increase based on an executive’s perception of a moral imperative to stockholders. At what point do drug prices hold patients and insurance company’s hostage?
If the copies of the Van Gogh were to go from $250 to $100,000, my guess would be that most people couldn’t afford them. Because Big Pharma understands that most patients have little choice, they seize an opportunity for profit.
The FDA has regulations in place for a reason. I understand they have a lot of red tape that drives Mr. Mulye apoplectic, and maybe the regulations need to be streamlined. Still, when Shkreli imposed 5,000% increases or Mulye, his 400% it is an ethical, rather than a moral argument.
