Pharmaceutical companies that raise the price of lifesaving drugs may seem arbitrary, cruel and even outrageous. The famous CEO Martin Shkreli has raised the price of Daraprim, a drug used by AIDS patients to fight infections, from $ 13.50 to $ 750 for a pill. Mylan has increased the cost of Epipen, which eliminates anaphylactic shock caused by allergies by 500%, from $ 100 to $ 600.
And now, there is the case of Evzio. It's an auto-injector that talks with naloxone, the antidote for reversing opioid overdoses. It is easy to use for people without medical training. According to industry experts, naloxone can cost as little as 20 cents. But Evzio costs a lot more: its price is over $ 4,000.
Lesley Stahl: What are you thinking of, in the midst of a crisis, driving up prices in this way?
Ms. Jennifer Plumb: If you're trying to get coverage as wide as you can and you're looking at the price increase, you're going to feel really predatory. And it's really carefree.
Dr. Jennifer Plumb, who runs an organization that distributes naloxone in Utah, distributes cheaper syringes, about $ 15 each. She says they're as easy to use as the newer, more expensive devices. We decided to try it ourselves.
Lesley Stahl: So give me the syringe for a second.
Jennifer Plumb explains to correspondent Lesley Stahl how to inject naloxone with a syringe
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Dr. Jennifer Plumb: Agreement.
Lesley Stahl: Here I try to do this thinking that I have a body in front of me and that I am a nervous wreck.
Dr. Jennifer Plumb: Of course.
Lesley Stahl: And there is a lot of panic in me. So I did that. I withdraw that … Twist– Oh, okay. Already, I've messed up–
Dr. Jennifer Plumb: No, see.
Lesley Stahl: … taking a nervous break …
Dr. Jennifer Plumb: You see, that's fine, though. Just shoot.
Lesley Stahl: So you put that somewhere. So bend it?
Dr. Jennifer Plumb: Uh-huh.
Lesley Stahl: And move the needle underneath the airline.
Dr. Jennifer Plumb: Yeah.
Lesley Stahl: Okay, now I have problems. It's not as easy as you– keep saying.
Dr. Jennifer Plumb: You do not think so?
Lesley Stahl: No.
At least not for me. We then tried Narcan, the nasal spray. It costs a lot more than the syringe: $ 125 for a pack of two.
Lesley Stahl: You peel. Put it in the nose. And push.
Lesley Stahl: So I pushed it high up in the guy's nose?
Dr. Jennifer Plumb: Uh-huh.
Lesley Stahl: Or the woman's nose?
Dr. Jennifer Plumb: Uh-huh.
Lesley Stahl: And I'm diving?
Dr. Jennifer Plumb: Yes.
Lesley Stahl: Oh. Here!
Dr. Jennifer Plumb: That's it. Now, take into account the fact that you may have to deal with a lot of nonsense to be able to do this easy step.
An Evzio injector that emits audio instructions in use
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Then there is Evzio, by far the most expensive option. It's an auto-injector that guides you through the process:
EVZIO TRAINER: To inject, place the black tip against the outside of the thigh …
I used a trainer without naloxone.
EVZIO TRAINER: Five, four, three, two, one. (BIPE) The injection is complete.
Dr. Jennifer Plumb: That's it.
Lesley Stahl: Wow.
Dr. Jennifer Plumb: So you understand, easy to use?
Lesley Stahl: I understand.
Dr. Jennifer Plumb: It's there.
Lesley Stahl: Really easy. I think because something is talking to you, it's quiet.
Dr. Jennifer Plumb: You have the feeling of having some advice.
Lesley Stahl: I understand why it's more expensive, not so expensive, but …
Dr. Jennifer Plumb: I do not know. I bought a card that speaks to me at Walmart for $ 1.49 yesterday.
"These are women aged 45 to 54. It is the one who is most likely to die today in Utah."
At over $ 4,000 for a two-pack, even with discounts and donations, Evzio is totally off-budget for organizations like Dr. Plumb's or for first responders dealing with addicts on the streets. But the maker of Evzio has targeted a different risk population. That's the group, says Dr. Plumb, who has the most overdose deaths in Utah.
Dr. Jennifer Plumb: Imagine who you are today for whom someone is planning a funeral. I imagine a young man of 22 years without a job, without change, perhaps without shelter. Well, here's the demographics: it's me. They are women from 45 to 54 years old. That is who is most likely to die today in Utah.
It is a fact that women and men of average age constitute a large vulnerable population throughout the country.
They often die at home after abusing or abusing high-dose pain pills. Other household members with access to the medicine cabinet are also at risk.
Dr. Jennifer Plumb: I can tell you several stories of children, babies who do not breathe from …
Lesley Stahl: Babies?
Dr. Jennifer Plumb: … accidental exposures to their homes. If you hang out with children, they are oral explorers. I love them a lot. But they are hogwash. They enter everything, right?
So doctors, who prescribe opioids, are now encouraged
Prescribe naloxone at the same time. This is what is called co-prescription, and opioid and antidote are supposed to be covered by insurance. This is the lucrative market that Kaleo, the maker of Evzio, was looking for. The price of the injector was high to start: $ 575. And then increased by more than 550 percent.
Two former Kaleo sales representatives are keeping in shadow with correspondent Lesley Stahl for fear of being trapped in the industry
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Former employee of Kaleo 1: I started my job search the day after the announcement of the price rise because it was both greedy and a little unethical , in my opinion.
We have talked to over a dozen former Kaleo employees, including these two sales reps, in the shadows for fear of getting caught in the black in the industry.
Lesley Stahl: You would go to the doctor and try to convince him to write a prescription for this drug that just went up to $ 4,000. How did the doctors react?
Former employee of Kaleo 1: The doctors, most of them were disgusted.
Lesley Stahl: And how you feel?
Former Kaleo 2 employee: I felt slimy. I no longer feel like helping people. Now, I feel that I'm taking advantage of people.
Former Kaleo employee 1: Now, remember, we are talking about naloxone. Kaleo did not invent or discovered naloxone.
Lesley Stahl: Okay.
Former employee of Kaleo 2: Naloxone exists for 50 years.
Lesley Stahl: It's a generic at this point.
Former employee of Kaleo 2: It costs a few cents. Imagine if you took aspirin, you were there forever, and you wrapped it in a fancy box and put a bow in it.
The price rose after this man was hired by the company.
Lesley Stahl: Todd Smith. Who is he?
Former employee of Kaleo 1: he was a consultant for Kaleo Pharmaceuticals, he was a consultant and held other positions in other pharmaceutical companies. And it is a bit notorious for having proposed this pricing strategy to these companies.
Lesley Stahl: So he had done it in other companies-
Former Kaleo 1 employee: Oui–
Lesley Stahl: … before he gets to Kaleo?
Former employee of Kaleo 2: Uh-huh.
Lesley Stahl: "This," being the price increase?
BOTH: OK.
Todd Smith was not talking to us in front of the camera, but here is his summary: when he was commercial director at Horizon Pharma, this bottle of pills for arthritis was going from about $ 100 to over 1,000 dollars. In a company called Novum, he raised the price of this skin gel from about $ 200 to nearly $ 8,000.
Kaleo was just another drug company that he advised. But it was about making a rescue device in the midst of an increasingly serious health crisis.
Kaleo CEO Spencer Williamson
Lesley Stahl: You have been called greedy, carefree. This was called profit, as you well know. It was the reputation you got.
Spencer Williamson: Lesley, that could not be further from the truth.
Meet Spencer Williamson, CEO of Kaleo.
Lesley Stahl: You pay the price of $ 575 –
Spencer Williamson: Lesley, I–
Lesley Stahl: – $ 4,000! $ 4000!
Spencer Williamson: Lesley?
Lesley Stahl: What?
Spencer Williamson: I do not like that word. We have raised the price to improve access to this product.
Lesley Stahl: Okay, now … explain that.
Spencer Williamson: Yeah, that …
Lesley Stahl: It's hard to understand.
Spencer Williamson: The big misconception is that by increasing the price of Evzio, we are reducing access to this product. The opposite is true.
Lesley Stahl: More people get it at this price?
Spencer Williamson: Yes, the numbers do not lie. Therefore, fewer than 5,000 prescriptions were executed in the first 12 months. In the past 12 months, more than 65,000 prescriptions have been executed.
How can this be? Well, when Kaleo set the initial price at $ 575, he was warned that it would be too high for intermediaries called pharmacy compensation managers, or PBMs who negotiate the price of drugs for health care plans. Kaleo believed that his easy-to-use product would be irresistible in the context of a growing opioid crisis.
But when he came to the market, Williamson said, PBMs tried to discourage doctors from prescribing Evzio … piled on cumbersome paperwork.
Spencer Williamson: A doctor had to show that one patient had failed with another form of naloxone before they could get this product.
Lesley Stahl: If they failed, they would be dead.
Spencer Williamson: Exactly.
Lesley Stahl: I mean, does that make sense?
Spencer Williamson: No.
Lesley Stahl: No. Were there other obstacles?
Spencer Williamson: Yes, the second hurdle, the other … the second tool that they use is the high patient copays. They force the patient to pay a large amount in his pocket. Here is a scenario that has been played several times. A patient goes to a pharmacy with her opioid prescription and she goes with her prescription of vital product.
Lesley Stahl: Co-prescribed.
Spencer Williamson: Co-prescribed. The opioid is prescribed, no problem, a very low co-payment. This is blocked. The rescue product is blocked.
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