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US Health Secretary Pick Hammered on Price Gouging

10.01.2018 -

Alex Azar, US President Donald’s Trump’s choice to head the Department of Health and Human Services (HHS), has faced from criticism from Democrats in the Senate Finance Committee for the sharp drug price rises he oversaw as president of US pharmaceutical producer Eli Lilly.

At a Senate confirmation hearing, reports said Azar acknowledged being involved in the jacking up of wholesale prices for Forteo, an osteoporosis drug, by 270% and 210% respectively. while he headed Lilly.

The nominee, however, deflected criticism by saying that high prices are a “systemic problem” and that he wasn’t personally responsible for the trend.

“I don’t know that there is any drug price of a branded product that has ever gone down from any company, on any drug in the United States, because every incentive in this system is toward higher prices,” Azar is quoted as telling the committee.

Azar was responding to questions from Senator Ron Wyden of Oregon, who produced graphs to illustrate sharp increases in the prices of the two drugs while Azar headed Eli Lily. His term ran from 2012 until early 2017, when he left during a management reshuffle.

Azar also served as Deputy Secretary of HHS under former president, George W. Bush.

During the questioning, another Democratic senator, Claire McCaskill of Missouri, made reference to Martin Shkreli, the now-imprisoned ex-pharmaceutical executive, who was convicted in August 2017 of securities fraud.

Shrekli’s claim to notoriety was, as founder and CEO of Turing Pharmaceuticals, hiking the price for Daraprim (pyrimethamine), a 62-year-old drug used to treat toxoplasmosis, from $13.50 to $750 per pill. His conviction, however, was for siphoning off millions of dollars in assets from Retrophin, another drugs firm he founded to pay off defrauded investors in his failed hedge fund.

Senators McCaskill and Susan Collins, a Republican from Maine, authored a report on price spikes in the drug industry, which McCaskill urged Azar to read.

The Missouri senator also pressed Azar about another controversial pharmaceutical industry issue, direct-to-consumer marketing. She pointed to tax write-offs US drugmakers receive for advertising and how these allegedly encourage patients to effectively treat themselves.

Earlier this week, the US political news magazine Politico reported that while Azar was in charge of Lilly, the company tested its erectile dysfunction pill Cialis for off-label use on children with a form of muscular dystrophy. Politico said Pfizer also tested its blockbuster erectile dysfunction drug Viagra on children with respiratory problems.

Under a law devised to promote research, pharmaceutical companies are eligible for patent extensions if they test their products for indications beyond those they were approved for.

If confirmed in the cabinet position, Azar would replace former Georgia Representative Tom Price, who was forced to step down last year after it emerged that he had spent government funds on personal travel.