Page 21 - CL Armchair Case

SHAREHOLDERS: REACTIONS & EXPECTATIONS

CorePharma’s shareholders have been dragged into the

Daraprim price hike story. They are not the villains of the

piece but their pricing strategy is a substantive element.
What is more, their shareholders should be asking why their

management weren’t making more money on a vitally

important, seldom used drug for which they were the only

manufacturers.

CorePharma had already raised the price of Daraprim from

$1/pill to $13.50 to which there was little complaint.

Turing’s assessment of the situation, CorePharma missed a

massive opportunity to go higher, and in doing so, did a
disservice to its shareholders.

This is not to say that the raise to $750 was right, but

certainly the market could have withstood something in

between for an important drug with few prescriptions per
year.

CorePharma shareholders should have demanded a pricing
premium given the strategic situation as sole supplier.