During today’s congressional hearing on drug pricing, Rep. Jason Chaffetz (R-Utah) made his own case against the price gouging antics seen at Turing Pharmaceuticals.
He pointed out a number of salary hikes seen last year among Turing’s top executives, as noted in documentation received by the House Oversight and Government Reform Committee in advance of the hearing. Though the names have been blacked out, the October document indicates three major salary raises.
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In the midst of a storm of negative PR for Turing, one executive saw a salary increase of $160,000, increasing the salary to $800,000. Another saw an increase of $275,000 to an annual salary of $600,000. And a third saw an increase of $275,000 to $600,000.
Chaffetz said this in part to contradict the words of Nancy Retzlaff, Turing’s chief commercial officer, who was at the hearing to represent Turing Pharmaceuticals. She said that Turing isn’t making a profit on Daraprim sales – but later admitted, when asked about first-year revenue, that Turing’s gross sales were $98 million, and net sales were $20 million.
“People can make a profit. They can pay exorbitant salaries,” Chaffetz said to Retzlaff. “But don’t come before the American people and shed a tear, and say ‘we’re not making any money.'”
Furthermore, he took offense that Shkeli – who holds the majority of shares in the company – told news reporters that Turing planned to invest all of its cash into R&D.
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“It sounds like a contrived PR plan to do that,” Chaffetz said.
Chaffetz also cited costs that Turing spent on a salesforce party last year – in which it spent $23,000 to rent a yacht from Metro Yacht Charters. Among the expenses included fireworks and an $800 cigar roller.
“So don’t tell me you’re losing money. Don’t try and pretend and tell us this $750 is justified when you’ve got a woman who’s got AIDS,” Chaffetz said. “What is she supposed to do? Tweet Martin and try and get that for a penny?”
[Image courtesy of Getty]
