- A now-viral clip of Rep. Katie Porter shows her laying into the former CEO of the drug company Celgene for tripling the price of a cancer drug and detailing how that price hike was connected to the CEO’s salary.
- The clip comes from a hearing concluding a damning 18-month investigation that found drug company profits are the largest driver of drug price increases and gouging.
- The reports show that the companies intentionally drove up the prices of essential drugs to meet quarterly earnings goals, engaged in anti-competitive behavior, and lobbied extensively against reforms.
Rep. Katie Porter (D-Ca.) trended on Twitter Wednesday after grilling the former CEO of the drug company over price hikes for the cancer drug Revlimid.
In a viral video, which now has over 19 million views, a white-board wielding Porter writes the number “$13 million” and asks Celgene CEO Mark Alles if it “rings any bells.”
“This was your compensation in 2017 for being CEO of Celgene, and that’s a lot of money. It’s 200 times the average American’s income and 360 times what the average senior gets on Social Security,” she said.
“Now, of that 13 million, about 2.1 million came from your company hitting yearly earnings targets, and more than half of the bonus formula was based on those targets,” she continued. “Any increase in the price of Revlimid would also increase your bonus by increasing earnings, isn’t that right Mr. Alles?”
Alles responded that that assessment was correct, and Porter went on to tell him that the House Oversight Committee found “that if you hadn’t increased the price of Revlimid you wouldn’t have gotten your bonus.”
“In fact, you personally received half a million dollars personally just by tripling the price of Revlimid,” she added. “So, to recap here, the drug didn’t get any better, the cancer patients didn’t get any better: you just got better at making money, you just refined your skills at price gouging. And to be clear, the taxpayer spent $3.3 billion on Revlimid.”
House Investigation Findings
The now-viral video comes from a House Oversight Committee hearing that took place Wednesday.
The hearing, which was the first of two, marks the conclusion of a nearly two-year-long investigation by the committee’s Democrats into prescription drug price gouging. The reports from that investigation — two of which were also released ahead of the hearing — are incredibly damning.
Those first two reports focus on Celgene, which is now owned by the drug company Bristol Myers Squibb, and its pricing of Revlimid, as well as another pharmaceutical company called Teva and its multiple sclerosis drug Copaxone.
Among other things, both reports reveal how the massive profits these companies made have been the driving force in the huge price increases for these essential drugs.
According to the reports, Teva has raised the price of Copaxone 27 times since 2007, and because of those price increases, an annual course of the drug now costs nearly $70,000 — seven times the $10,000 it cost in 1997.
As for Revlimid, since 2005, Celgene has raised the price of the drug 22 times, from $215 per pill to $719, the report said. After Bristol Myers Squibb got the rights to Revlimid last November, it raised the price again, to $763 per pill.
Those price hikes have been insanely profitable. As the reports outline, Copaxone has brought in more than $34 billion in net profits for Teva just in the U.S. alone. Meanwhile, just between 2009 and 2018, Celgene collected $51 billion in net revenues from Revlimid sales worldwide and $32 billion in the U.S.
As Porter mentioned in the viral clip, the reports also found that those profits end up costing taxpayers and Medicare tens of billions of dollars, which are then used to pay generous executive bonuses.
Another hearing is set to be held Thursday with testimonies from other CEOs of other drug companies. The reports on those companies will be released ahead of the hearing as well.
Reports Contradict CEO Testimonies
In Wednesdays hearing, Alles, as well as the CEO of Teva, both defended the price hikes as above-board and merited.
“The pricing decisions for our medicines were guided by a set of long-held principles that reflected our commitment to patient access, the value of a medicine to patients in the health care system, the continuous efforts to discover new medicines and new uses for existing medicines and the need for financial flexibility,” Alles told the representatives.
However, Porter specifically asked Alles if the drug’s formula had been substantially improved from 2005 , when the pill cost $215, to now, when it costs three times more. Alles confirmed that the manufacturing for the drug had not changed, but said it had been approved for new uses.
Arguably even more damning is the fact that internal documents and emails included in the report showed that executives at both Celgene and Teva raised prices unrelated to costs in order to meet quarterly profit goals.
In one of the most explicit examples, the Celgene report notes that in 2014, Alles — who was then the executive vice president of the company — ordered the price of Revlimid be jacked up by 4% because the company had not met its first-quarter sales goals. Just days later, Alles gave a presentation to the company’s drug pricing advisory board that noted the increase would result in $24 million in new net sales.
As for Teva, the company’s CEO Kåre Schultz also defended the price jacking of Copaxone during the hearing, though he offered another explanation.
“In order for any pharmaceutical company to research and develop new drugs, or improve old ones, the price of successful medicines must reflect the significant cost of ongoing research and development projects,” he said. “The public only sees and pays for the drugs that are ultimately approved by the government, like Copaxone, but you have to expend a lot of resources and endure many disappointments before bringing to the market safe and effective medicines.”
The committee’s report on Teva also disputes that claim too. In fact, it specifically found that Teva has only spent $689 million on research related to Copaxone since 1987 — just 2% of the nearly $34 billion it has taken in net revenue for the drug.
Beyond the price hikes, the reports also gives the public what has been described as the clearest proof to date that large drug companies are engaged in anticompetitive behavior to force competitors out of the market.
In one of the most egregious examples, Teva put out a new, stronger version of Copaxone as part of what they referred to as a coordinated “generic defense strategy.” According to internal documents, that strategy included working with middlemen to block other generic drugs from getting market access, as well as launching aggressive campaigns to lobby doctors and patients to stick with the more expensive version of the drug.
To that point, the Congressional reports also show how these companies have lobbied extensively against regulations and reforms that would prevent them from ramping up drug prices. However, in providing the public with this information, the Democrats on the committee hope to push for substantial drug pricing reforms.
In a letter prefacing the reports, Oversight Committee Chair Carolyn Maloney (D-Ny.) emphasized the need for comprehensive legislation such as the drug price bill passed by the House back December known as H.R. 3, which would reform the system by allowing Medicare to negotiate directly with drug companies over prices.
As Maloney notes, that bill essentially died in the Senate because President Donald Trump openly opposed it and Senate Republicans refused to even bring it for a vote.
Conservatives are Mad at “Woke” Xbox for Minor Climate-Related Updates
The fury comes after Xbox announced it was slightly altering existing consoles to better utilize and save energy.
Same War, New Battlefield
Mere days after M&M canceled their “spokescandies” due to backlash from the right, led largely by Fox News’ Tucker Carlson, conservatives have found a new front for their ongoing culture war: Xbox.
Carlson spent months complaining that small character redesigns were “woke” because they made the animated anthropomorphized M&M’s — in his own words — “less sexy.” His campaign finally proved successful on Monday when the company announced it would be doing away with the spokescandies and replacing them with actress Maya Rudolph.
Conservatives, now facing a sudden dearth of non-issues to complain about, quickly found a new issue to rage against. Xbox announced in a blog post earlier this month that it is making minor updates to lower its environmental impact as part of an effort to reach Microsoft’s goal of being carbon-negative by 2030.
Now, instead of having an Xbox wake up to update games, apps, and software during random times of the night, it will do that at a time of night when a user’s local energy grid is generating the most power it can from renewable sources.
Xbox also said it would automatically update some older consoles to a power-saving mode that aims to reduce electricity consumption when it is turned off — a feature that is already the default on newer consoles.
According to The Verge, the only difference for users is that an Xbox in power-saving mode takes around 15 seconds to boot up instead of doing so immediately as the console does in “sleep” mode. The change is a small price to pay for what the outlet described as “significant” energy savings.
Xbox Under Fire
To many leading conservative voices, the minimal shifts were just another example of “woke” culture.
While discussing M&M’s spokescandies Tuesday morning, “Fox and Friends” co-host Ainsley Earhardt brought up Xbox’s new changes with Fox radio host Jimmy Failla.
“So Xbox has also announced that they’re going woke too, you know, because of climate change,” Earhardt said.
“I mean, it’s crazy what they’re doing, but we understand what this is. It’s not that it’s actually going to offset emissions, okay — the level of reduction is infinitesimal,” Failla claimed, without evidence. “But they’re trying to recruit your kids into climate politics at an earlier age; make them climate conscious now.”
“Yeah, I didn’t think of that — you’re right, they’re going after the children,” Earhardt agreed, despite the fact that internal data from Microsoft shows just around 10% of Xbox owners are under the age of 18.
Other prominent conservatives also did their part to bait Americans into anger on social media, including America’s Foundation, which posted a tweet stating that “the woke brigade is after video games.”
The post linked an article from the right-wing website TheBlaze, which asserted that “Xbox will force gamers to power down to fight climate change.” That, however, is false — Xbox has said users can switch back and change the settings any time they want
Still, top lawmakers continued to share the article and spread its false claims, including Sen. Ted Cruz (R-Tx.).
“First gas stoves, then your coffee, now they’re gunning for your Xbox,” he wrote in the post, which was flagged by Twitter and given an “added context” warning.
The same warning, however, was not placed in a very similar post by Rep. Troy Nehls (R-Tx.), who also shared the article.
“They want to take your guns. They want to take your gas stoves. And now they want to take your Xbox. What’s next?” he wrote.
See what others are saying: (The Washington Post) (The Daily Beast) (VICE)
Washington State Launches Investigation Into Abuse at Private Special Ed. Schools
Allegations include staff kicking a fourth-grader and dragging a child with autism around by his leg.
Washington State’s Office of Superintendent of Public Instruction (OSPI) has launched an investigation into a system of private schools for kids with disabilities after ProPublica and the Seattle Times reported on allegations of abuse.
The series of articles focused on Northwest School of Innovative Learning (NWSOIL). NWSOIL is a set of private schools that serve 500 Washington public school students with serious disabilities. ProPublica and the Seattle Times found years of complaints from parents and school districts against NWSOIL alleging abuse, overuse of isolation rooms, and unqualified aides teaching instead of certified professionals.
One district claimed NWSOIL staff kicked a fourth-grader. Another alleged that a child with autism was dragged around by his thigh.
Many former NWSOIL employees also claim that they were pressured by their parent company to to enroll more students and skimp on basic resources, like staffing.
In a seven-page letter, OSPI reminded NWSOIL of its authority to revoke or suspend a school’s approval, meaning that it could shut NWSOIL down.
“Given the serious nature of the allegations made in the articles, OSPI is examining what, if any, actions need to be taken with respect to Northwest SOIL’s approval to contract with Washington school districts,” Tania May, assistant superintendent for special education at OSPI, wrote in the letter.
OSPI has demanded any records of mistreatment, maltreatment, abuse, or neglect as well as documents pertaining to restraint or isolation of students and calls to the police. They are also seeking information about the student-to-teacher ratio and staff qualifications.
In the letter, OSPI claims that all of this was previously unknown to them as well as to police, Child Protective Services, and local school districts. They are asking NWSOIL for an explanation as to why the allegations were not reported.
NWSOIL defended itself in a public statement.
“Use of restraints and seclusion are always used as a last response when a student is at imminent risk of hurting themselves or others,“ it said. “We strongly deny any allegation that we understaff and/or pressure staff to increase admissions in order to maximize profits.”
Washington state representatives are considering a reform bill that will give them more oversight on the publicly funded system of private special education schools.
In this legislation, OSPI and at least one district that sends students to this program would be required to visit before approving the contract. It would also standardize district agreements with programs like NWSOIL, including financial safeguards to make sure funds are being used appropriately.
See the full series: (ProPublica) (The Seattle Times)
Mass Shootings in Half Moon Bay, Oakland Rock California
Just since Saturday, at least 19 people have been killed and 17 have been injured in mass shootings in California.
California Sees Third Attack in Under a Week
Two California localities experienced separate mass shootings Monday, just days after an attacker killed 11 and injured nine others in a suburb of Los Angeles.
The first of the most recent shootings took place in Half Moon Bay, a small coastal town about 30 miles outside of San Francisco, where a gunman killed seven and critically injured an eighth at two different locations.
According to authorities, police were dispatched to the first location around 2:20 pm and found four people shot to death and a fifth victim also suffering gunshot wounds. Shortly after, three more people were found dead at another site nearby.
About two hours later, police discovered the suspect in his car in the parking lot of a San Mateo County Sheriff’s Office substation with a semiautomatic handgun in the vehicle that officials later confirmed he had purchased legally.
Sheriff Christina Corpus said the man was taken into custody “without incident” and is “fully cooperating.” He has been identified as a 66-year-old Half Moon Bay resident of Asian descent.
Currently, the gunman’s motive is unknown, but the Sheriff told reporters Monday that both of the locations he targeted were nurseries, and it has since been reported that they were mushroom farms.
“All evidence we have points to this being an instance of workplace violence. The Mountain Mushroom Farm, the first location, is where the subject was employed,” Corpus said in a press conference Tuesday, though she added that, so far, the “only known connection between the victims and the suspect is that they may have been coworkers.”
As of writing, it remains unclear why he targeted the second location. A mushroom farm called Concord Farms has told reporters that it was the site of the second shooting — which a law enforcement official confirmed to The Washington Post.
In a statement to the media, a spokesperson said the farm had “no past knowledge” of the alleged gunman or his possible motives. Little has been released about the victims, though Corpus said Tuesday they were all adults and a “mixture of Asian and Hispanic descent,” some of whom were migrants.
Authorities had previously stated that, because people both live and work on the farms, children were among those who witnessed the shooting. However, on Tuesday, one official walked that back and said while children were indeed in the vicinity, police do not have information about specific witnesses.
Just hours after the violence in Half Moon Bay, seven people were injured, and one other was killed during a shooting at a gas station in Oakland. Very little has been reported about the incident, but police have said that the shooting was “between several individuals.”
Renewed Calls for Gun Control
Californians continue to reel from the rapid succession of mass shootings in a state known for its strict gun control laws.
According to Everytown for Gun Safety, a nonprofit that advocates against gun violence, the state ranks No. 1 in the country for gun law strength. An analysis led by the organization found that California has the sixth-lowest rate of gun ownership and the eighth-lowest gun death rate.
Many of California’s top lawmakers have argued that the state’s relatively low gun violence statistics emphasize the need for more federal regulations.
“The Second Amendment’s becoming a suicide pact,” Gov. Gavin Newsom (D) told CBS News in an interview.
“We’ll continue to find whatever loopholes we can and continue to lead the national conversation on gun safety reform. And the data bares out. It works. It saves lives,” he continued. “California’s 37% lower than the death rate of the rest of the nation, and yet, with all that evidence, no one on the other side seems to give a damn. I can’t get anything done in Congress.”
Following the Monterey Park shooting, U.S. Sen. Diane Feinstein (D-Ca.), alongside other Democratic colleagues, introduced two gun control bills in the upper chamber. The first would ban assault weapons, while the second aims to raise the minimum age to purchase assault weapons from 18 to 21.
President Joe Biden quickly threw his support behind the measures, urging Congress to pass them.
“The majority of the American people agree with this commonsense action,” he said in a statement Monday. “There can be no greater responsibility than to do all we can to ensure the safety of our children, our communities and our nation.”
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