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Drug company CEO calls 400 percent price hike 'moral requirement'
The CEO of a pharmaceutical company is facing criticism for describing a 400 percent price increase of an antibiotic as a "moral requirement."
Nostrum Laboratories, based in Missouri, raised the price of nitrofurantoin last month from $474.74 a bottle to $2,393, according to the Financial Times newspaper. The drug treats urinary tract and bladder infections.
CEO Nirmal Mulye said the price hike was based on market dynamics, according to the newspaper.
"I think it is a moral requirement to make money when you can ... to sell the product for the highest price," he said.
Mulye said the branded version of the drug increased in price to $2,800.
"The point here is the only other choice is the brand at the higher price. It is still a saving regardless of whether it is a big one or not," he said.
Mulye also defended Martin Shkreli, the disgraced pharma CEO who faced national criticism, including outcries from members of Congress, after he increased the price of a life-saving drug by 5,000 percent.
Shkreli is now serving time in jail on unrelated fraud charges.
"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," Mulye said.
"If he's the only one selling it, then he can make as much money as he can," he added. "This is a capitalist economy, and if you can't make money, you can't stay in business."
Mulye's comments prompted swift backlash from Food and Drug Administration (FDA) Commissioner Scott Gottlieb.
"There's no moral imperative to price gouge and take advantage of patients," Gottlieb tweeted.
"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."