New York state is investigating six pharmaceutical companies for raising prices during the Covid-19 pandemic, in one case by more than 1,350%.
The newly formed Office of Pharmacy Benefits in the state’s Department of Financial Services is conducting the investigations. The state points out that it is not yet charging that the spikes in prices indicate something illegal happened but rather taking the position that the price spikes are worth investigating.
McGuff Pharmaceuticals is being investigated for a 110% increase in the price of its formulation of Vitamin C, Ascor, used for intravenous administration. The price hike occurred about a week after clinical trials were announced for use of the drug to treat Covid-19 patients suffering acute symptoms.
Cipla USA Inc., is being investigated for a 1,350% price hike involving the drug Budesonide, a corticosteroid. The price hike occurred in midst of the first wave of Covid-19 cases in the U.S. and on the heels of an announcement of international clinical trials for the drug’s use to treat Covid patients.
The 65% price hike by Nubratori Inc. for the drug Dexonto, also a corticosteroid, is under investigation. The manufacturer announced the price increase just 11 days before clinical trials for treating Covid-19 patients with the drug were announced in China.
Jaguar Health is being investigated for the 230% price hike of the drug Mytesi, which is used to treat gastrointestinal side effects of certain therapies used by HIV patients. Jaguar increased the price of the drug just days after it applied for an emergency use authorization for its use to treat Covid-19 patients.
The nearly 60% price increase on the morphine drug Duramorph by Hikma Pharmaceuticals during the early months of the pandemic is being investigated as is the 97.8% increase in the price of Chloroquine phosphate by Rising Pharmaceuticals.
Linda Lacewell, superintendent of the Department of Financial Services, said, “Putting profits over people’s lives is unconscionable. When drug manufacturers exploit a global pandemic for their own benefit, it cannot go unanswered. DFS will use every power at its disposal to shine a light on the world of drug prices. Today, we have taken our first steps in addressing the problem of excessive drug prices that has hit consumers’ pocketbooks directly and through insurance premiums.”
“It requires extreme greed and cynicism to see a global pandemic costing millions of lives as an opportunity for profit,” New York state Health Commissioner Howard Zucker said.
The state’s first move is to send a demand pursuant to New York Insurance Law Section 111 requiring a statement from the manufacturer explaining the facts and circumstances surrounding the price spikes.
“Throughout the Covid-19 pandemic, we’ve seen too many instances of pharmaceutical companies taking advantage of those in need and significantly raising the prices on life-saving prescription drugs,” Governor Andrew M. Cuomo said.
“This shameful behavior cannot stand and needs to be rooted out at all costs. Companies should be on notice – if you attempt to capitalize on the health needs of New Yorkers, we will investigate you and hold you fully accountable.”