Seeing the demand for its vitamin bottles Niacor rise, US drug maker Avondale decided to increase the price for a 100 tablet bottle overnight from $32.46 to $295.
That is surprising as its generic version can be bought online for as little as $5, which also means that it’s $32 price was already a steal.
Niacor is of course a prescription-only version of niacin, which itself is a type of vitamin B3 that is approved by the US Food and Drug Administration.
This regulatory approval means that many doctors prefer to prescribe Niacor instead of over-the-counter, cheaper alternatives.
Avondale acquired the rights to Niacor from Upsher Smith, a subsidiary of Japan’s Sawai Pharmaceuticals earlier this year, in a “buy-and-raise” deal of the sort popularized by the infamous Martin Shkreli (who is currently jailed for other criminal activities).
Some 19,000 prescriptions for Niacor were written in the US last year and it is expected this will remain so as doctors are not routinely made aware of price increases.
Mr Michael Rea, chief executive of Rx Savings, which makes software to help cut what people spend on medicine, commented: “This is the latest example of an inefficient US market where the consumer, payer and doctor don’t have all of the information available to make a financially sound choice.”
“They are caught in a web of inefficiency and are being taken advantage of.”
Avondale has no website but lists it’s address as a business park in Alabama.
Mr David Mitchell, a campaigner at Patients For Affordable Drugs, said Upsher, who sold the rights of Niacor to Avondale should carry some responsibility if it was aware of Avondale’s strategy: “If they sold the drug knowing that the purchaser was going to jack up the price and if they received a premium because the seller was willing to do what they were not for fear of blow-back then it seems to me they hold some responsibility.”