Sunday, October 18, 2015

The Daraprim Debacle - The Smell Test Sniffs Out Price Gouging.

You don’t need to be an ear, nose & throat doctor to be conversant with the ‘smell test’.   We use this technique in everyday life.  This diagnostic test is used to determine if a situation is an egregious deviation from established norms.  The beauty of the smell test is that one need not be encumbered by facts and data.  It relies upon emotion and instinct, which greatly simplifies its use.  Let me illstrate.

Situation When Smell Test Does Not Apply

  • Grading the SAT Examination.  Sniffing and smelling just won’t work here.

Situation When Smell Test Applies
  • A city mayor hires his brother in a no-bid contract as a consultant. 

Are you catching on here?

The Mother of All Smell Testers

I surmise that my erudite and insightful readers would sniff deeply through flared nostrils if they confronted the following situations.
  • “A double dip ice cream cone, which yesterday cost $4.25 is now $57.85.  A severe shortage of sugar cones developed last night.”
  • “The Sunday New York Times is now priced at $82.  Middle East turmoil has caused the price of newsprint to skyrocket!”
  • “Your overnight Fed Ex envelope will cost $325.  We haven’t had a price increase in 4 months and will use this revenue to serve you better.”
  • “Yes, I can reschedule your airline ticket with a keystroke for only $150.”
  • “Call this number and I will send you absolutely free my fool proof system to make millions in real estate without any money or experience!”
  • “One fat-burning pill a day will melt the pounds away without changing your diet or exercising!”

 No explanation, even when delivered by an authoritative  PR pro can make the bad smell go away.

Recently, Turing Pharmaceuticals acquired the drug Daraprim, which is used to combat toxoplasmosis, a potent parasite.   The new company decided that a slight price adjustment was necessary.  So, the price per pill was increased from $13.50 to $750.  No typo here.  Feel free to use your preferred search engine to seek out the company’s explanation for their mega-gouging.  While I always try to remain open to opposing views, can any explanation exist that would justify this increase?

This is an example of corporate excess that will boomerang right back to strike the perpetrator.  Wanton greed and arrogance will surely provoke anger and bring a hammer of reform crashing down.  Ask your doctor.  Physicians understand what happens when a profession refuses to heal itself. 

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