Following Report that Kansas City Pharmaceutical Manufacturer Increased Price of 65-Year-Old Drug by More than 400 Percent, McCaskill Demands Answers

Senator continues years-long effort to address skyrocketing drug prices for Missourians in new bipartisan request

WASHINGTON – U.S. Senator Claire McCaskill today demanded answers from Nostrum Pharmaceuticals, LLC, which manufactures pharmaceutical products in Kansas City, among other locations, following a report that the company had more than quadrupled the price of their drug nitrofurantoin last month. Republican Senator Susan Collins joined McCaskill in her bipartisan request.

“It’s the perfect example of everything that’s wrong with the industry and confirms the suspicions of millions of Missourians who think these pharmaceutical executives aren’t even considering anyone’s well-being but their own,” said McCaskill, the top-ranking Democrat on the Homeland Security and Governmental Affairs Committee. “People across Missouri are having to choose between medicine and food, between medicine and rent—and as long as that’s the case I’m going to do everything possible to hold these pharmaceutical companies responsible for these unconscionable price spikes.”

In August 2018, Nostrum increased the price of a bottle of the generic antibiotic nitrofurantoin by more than 400%—from $474.75 to $2,392. Nirmal Mulye, Chairman of the Board and Chief Executive Officer of Nostrum Pharmaceuticals, reportedly said that there was a “moral requirement to…sell the product for the highest price.” Casper Pharma, which produces a branded version of the drug, increased the price of its nitrofurantoin product by 182% between 2015 and March 2018—making the price for one bottle $2,800. Nitrofurantoin is now on the American Society of Health-System Pharmacists’ list of drug shortages.

McCaskill and Collins wrote in a letter to Mulye, “you … flatly argued that ‘it is a moral requirement to make money when you can…to sell the product for the highest price’ and compared your decision to increase the price for nitrofurantoin to that of an art dealer who sells ‘a painting for half a billion dollars.’ … In the pharmaceutical industry—as opposed to the luxury art market—pricing decisions can have a devastating impact on patients and their families that can literally amount to a matter of life or death.”

McCaskill has made tackling rising healthcare and prescription drug costs a top priority in the Senate. In March, McCaskill released a bombshell report which found that the prices of several of the most popular brand-name drugs in the Medicare Part D program skyrocketed between 2012 and 2017, increasing at almost ten times the annual average rate of inflation in this period. Last month, she released another investigative report which showed that drug prices directly negotiated by the government could save the Medicare Part D program $2.8 billion in a single year on the 20 most commonly prescribed brand-name drugs alone.

During McCaskill’s time as the top Democrat on the Senate Special Committee on Aging, she joined Republican Chairman Collins to launch an in-depth investigation into prescription drug price increases. McCaskill introduced legislation earlier this year to end taxpayer subsidies pharmaceutical companies receive for the billions of dollars they spend on prescription drug advertising each year, which currently is fully tax-deductible. Additionally, McCaskill’s bipartisan legislation to increase competition for generic drugs and help lower prescription costs was signed into law by President Trump. Last week, the Senate unanimously passed her bipartisan bill with Collins to crack down on pharmacy gag clauses that prohibit some pharmacists from telling customers that they could pay less for their prescription if they pay out of pocket.

Read the Senators’ full letter to Nostrum Pharmaceuticals HERE.