As mentioned in the first blog, Kaléo Pharma’s main ethical issue isn’t about their poor worker conditions or covering an issue up. It is quite the contrary, their issue is very much in the public. Their Auvi-Q, an alternative to the epi-pen, is being sold for $4,500 for two doses of $5 worth of epinephrine, and Evzio is being sold at the same price for $6 worth of naloxone.
One would think that something like this would require a hell of a good answer as to why it costs so much, as well as some explaining from people inside the company. But, there really has not been a ton of information coming from those working for Kaléo. That being said, Kaléo actually appears to have a general plan to make things less expensive for consumers.
“Company executives also said they were taking steps to limit the impact of the high list price on how much patients pay. They said Kaleo had put in place a program so that commercially insured patients, as well as uninsured patients with incomes less than $100,000, wouldn’t pay anything out of pocket and other patients wouldn’t pay more than $360.” (WSJ)
Kaléo appears to trying to take advantage of the disproval with the epi-pen, as Mylan, the owner of the epi-pen, has increased the price of their product 550% since 2007. It seems that Kaléo knows Mylan is having trouble with consumers with the epi-pen, so they are trying to get away with charging a high cost because they still will have a better reputation than Mylan. This is a bold strategy, but is much more thought out than the simple corporate greed that it appears to be.
Kaléo is obviously increasing competition in the pharmaceutical industry, which could end up decreasing the price for epinephrine administers as a whole, something that is much needed. Just two months ago Spencer Williamson, Kaléo’s Chief Executive, said that there is no other epinephrine injector on the market that offers a lower out of pocket cost to commercially insured patients than the Auvi-Q and Evzio, which can make justifying the reason for the high market price a little easier.
Williamson added that Kaléo has donated nearly 200,000 doses to “public health departments, first responders and nonprofits serving patients in need.” He also defends his company, stating that the listed wholesale price, which is for distributors selling to pharmacies, is $4,100, but it’s “not a true net price to anyone, including the distributors or pharmacies, due to numerous discounts and rebates that are negotiated in the supply chain that make up our health care system.”