C Citigroup Inc

Turing Pharmaceuticals AG, which drew the ire of patient groups and politicians after raising the price of an anti-parasite tablet more than 50-fold, said it will discount the drug as much as 50% to hospitals and take other steps to help patients afford the cost.

Privately held Turing bought the U.S. rights to the drug, Daraprim, in August and raised the price to $750 a tablet, from $13.50. The amount of the discount Turing announced on Tuesday will depend on how much of the drug hospitals use. Even at the full 50% off, however, the drug will still cost far more than before Turing increased its price.

In addition, health insurers would have to pick up the tab for patients who keep taking the drug after leaving the hospital. Though Turing said it was participating in federal and state health-insurance programs such as Medicaid, in which the drug would cost as low as $1 per 100-pill bottle.

"We pledge that no patient needing Daraprim will ever be denied access," said Nancy Retzlaff, Turing's chief commercial officer.

How much Turing would cut the cost of Daraprim has been a question since the company and Chief Executive Martin Shkreli drew criticism for the price increase from patient advocates and politicians including Democratic presidential candidates Hillary Clinton and Bernie Sanders.

The Wall Street Journal reported in September that Turing would cut the price, but was still working out by how much. The Journal reported last week on Turing's discounting plans.

Daraprim is a half-century-old drug that treats an infection from the toxoplasma parasite that can threaten the lives of HIV patients, pregnant women and others with weakened immune systems. Each year, more than a million people in the U.S. deal with the infections.

Turing's price rise became a featured example of the massive price increases that several pharmaceutical companies have taken, even though the companies hadn't done the research behind the medicine. Democrats in Congress have launched investigations.

A nine-month-old startup founded by hedge-fund manager Mr. Shkreli, Turing countered that it was using the higher revenue from the Daraprim price increase to fund its own drug research-and-development programs. Turing said Tuesday it was using some of the revenue from Daraprim to fund research into a new and better treatment.

"This is part of Turing's commitment to invest at least 60% of its revenues for the foreseeable future into research and development of innovative therapies, primarily for rare and neglected diseases," a company spokesman said.

Turing has started a second round of financing, aiming to raise $50 million to $100 million and valuing the company at $500 million, according to a person familiar with the matter.

Aside from offering discounts to hospitals, Turing also will start selling bottles containing 30 tablets, which would help hospitals that don't use a lot of the pills and don't go through all of the 100 tablet bottles that have been on sale.

In addition, Turing said it will start giving out free samples to doctors for starting patients on the drug.

The company also pledged to cut the out-of-pocket costs of the drug to no more than $10 a prescription if commercially insured patients use its copay assistance program. And Turing said it was contributing to a charity that could help Medicare patients afford their out-of-pocket costs.

The company said it will give the drug free of charge to patients whose incomes are at or below 500% of the poverty line.

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(END) Dow Jones Newswires

November 24, 2015 20:15 ET (01:15 GMT)

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