This week’s outcry and outrage over Martin Shkreli’s announcement that his company, Turing Pharmaceuticals, was purchasing the rights to Daraprim and raising the price to stratospheric levels lit the internet and social media in a way unseen since the race riots in Ferguson. Even Donald Trump’s ill-advised comments about immigration and fellow candidates didn’t illuminate things to this degree. That being said, it’s time for a rather “tell it like it is” look at Shkreli’s decision.
First off, let’s get straight to the point of contention; Daraprim, a medication used to combat malaria, as well as toxoplasmosis and AIDS, had been sitting on the “rights shelf” for over 60 years. Up until Shkreli’s announcement, this medicine sold for $13.50 per pill, hardly a bargain by any stretch. Yet it was his decision and announcement to increase the price to $750 overnight which is what secured him the image of being a hero to hardcore libertarians and uber-capitalists, and a villain to, well, most of planet Earth.
His choice wasn’t entirely off the wall, though he own personality and presentation of reason, which combined hubris with a sense of venture-capitalist entitlement (more on that term later), is what makes Shkreli appear just a half-rung off John D. Rockefeller for the not-so-coveted prize of Satan’s economic advisor. Looking objectively at this matter, it’s actually pretty difficult to tell if Shkreli is the product of his own foolish pride, or if this is a matter of an agenda-driven media assault on a CEO.
Upon examine of the medication’s application, it really isn’t a “big player” in the world of modern medical practice. Daraprim accounts for a minuscule level of commerce in the pharmaceutical world, and its applications are fairly limited. That being said, the fact that it was jacked up in price by over 5000 percent (yes, the math is sound) after having sat at its current price point (adjusted mainly for inflation) for over 60 years does strikes as a case of opportunistic price gouging.
One of the issues raised following Shkreli’s announcement, and especially his defensive reaction afterwards, was the increasing impression that many venture-capitalists, or capitalists in general, have veered towards possessing attitudes of entitlement with regards to how their decisions should be received. Much like professional sports owners who demand millions in tax breaks for stadiums from communities which can ill-afford them, those of Shkreli’s ilk have been putting off an attitude of quasi-royalty, displaying a apparent disdain for those who have not been quite a fortunate in their lives. Whether this is fair or not is immaterial – this sort of entitlement mentality is no better than that which is displayed by those who refuse (not those who are disabled or otherwise unemployable) to exit government benefit rolls. It’s the same attitude, only in a gold-foiled package.
I can’t help but get the sense that Shkreli’s announcement was less about the money and more about his flexing his proverbial executive muscles for all to see. This is a guy who, when you look him up on social media, seems to get a serious charge out of looking outrageous, ridiculously rebellious, and ready to ingratiate himself to whatever pleasures befall him. That is not a moral judgment; it is a self-evident statement based entirely on the images this man chooses to present to the world. In his interviews, he appears overconfident, highly arrogant, and willing to essentially tell the world what to do with itself. If there was a modern-day John Galt wannabe, Shkreli appears to be playing that role to the hilt, and loving every single damned second of it. If he wants to do that, it’s his choice, but he needs to accept, rather than defend against, the backlash against him. That defensiveness is what I mean when I speak of a capitalist entitlement mentality.
Let’s face facts; Turing Pharmaceuticals owns the rights to this medication, and can now do with it, short of a collective multi-governmental effort, as it pleases. Anyone who understands the world of biological research and disease control/prevention knows that research and development are not cheap. The amount of time it takes for discovery, research, clinical trials, patenting and ultimate approvals of various government agencies more than justifies the steep price of many cutting-edge medications and treatments. It is when a medicine which has been around for over a half-century is suddenly deemed worthy of further development and sees a subsequent price hike in the thousands of percent range that one has to be skeptical of not only the intent for research, but the ultimate reason an executive would dare to so blatantly, and confidently, announce and justify said decision. This would have been akin to a pharmaceutical firm being able to buy the rights to Penicillin, cranking up the price to unheard-of rates, and rolling out “rebooted versions” of Amoxicillin and other such products.
Shkreli may not be the most likable executive to ever grace media, but he’s made a buzz. He appears to have studied at the altar of Ayn Randian economic thought, and secured a fellowship from the Donald Trump school of Machiavellianism. I’m certain his friends and family will defend him to the last, but I can’t help but feel that this announcement wasn’t about economics, shareholder return, class warfare, or any sort of sinister plot to harm billions. Instead, this appears to come down to the most classic, and Freudian sort of executive behavior one could possibly theorize – Shkreli is whipping out his figurative wanker for all to see and screaming “look how big an executive I am!”
His move is not unlike someone sending an unsolicited sex selfie – highly offensive to most who saw it, not very well strategized, and has already blown up in his face. Still, I get this distinct feeling he doesn’t really care.