MARIETTA, Ga. — The city of Marietta is suing a drug maker for charging $39,000 for a drug that used to cost $40. The city says the drugmaker, Mallinckrodt, is gouging the city – as well as other patients and health care providers.
This is a dispute over a drug that has been around for nearly 70 years – a vial of which is now about as expensive than a new Tesla.
The city of Marietta has about 700 employees in its insurance benefits program and another 300 retirees.
According to a lawsuit filed by the city of Marietta against Mallinckrodt, the price has skyrocketed. In 2001, a vial of it cost $40. Now, the price of a vial is more than $39,000. The suit measures that as an increase of 97,000 percent.
The lawsuit says Marietta has one patient in its insurance plan that requires Acthar, an injectable drug that helps patients with multiple sclerosis, infant seizures and other disorders. The suit says the city’s insurance plan has “expended over $2 million for Acthar for just one patient.”
The lawsuit says one typical treatment regimen requires three vials of Acthar, costing nearly $120,000.
"Insurance companies don’t pay it. We are all paying it," said Georgia State University College of Law professor Yaniv Heled, who says it can happen when one drug company controls the supply.
The suit says the manufacturer of Acthar “acquired, then shelved the rights to a … much cheaper synthetic equivalent” – keeping the price of Acthar sky-high.
"To create a generic version of this drug is very complicated, very involved," Heled said. If "your baby is having a seizure, you're going to do anything and everything to get the $120,000 you need to treat your baby."
Heled says Acthar knockoffs are available overseas at prices closer to $40 than $39,000.
The City of Marietta declined comment on the pending litigation, as has Mallinkrodt, the pharmaceutical company which sells Acthar.
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