Biotech stocks got crushed today, got crushed all week, got crushed since their peak in early July. ‘Bloodletting’ comes to mind. But who the heck did the crushing? That’s what everyone wants to know. And the finger-pointing has started.
Early in the week, they blamed the New York Times because it had ran an article on Sunday on a hedge fund guy named Martin Shkreli who’d founded Turing Pharmaceuticals, which bought the rights to a generic drug that has been around for six decades, called Daraprim, ‘the standard of care for treating a life-threatening parasitic infection.’ In his hedge-fund manner, knowing he had a monopoly, he jacked up the price from $13.50 to $750, raising the ‘annual cost of treatment for some patients to hundreds of thousands of dollars.’
This caused a national stink. Presidential candidate Hillary Clinton jumped into the fray with a proposal to cap prices of specialty drugs to prevent ‘price gouging.’ Drug makers absolutely adore that kind of language.
This post was published at Wolf Street on September 25, 2015.
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