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Mylan agrees to pay fine over EpiPen rebates Posted 21/10/2016

US-based drugmaker Mylan announced on 7 October 2016 that it had agreed to pay US$465 million to the US Department of Justice (DOJ) and other government agencies. The agreement, the company says, will resolve questions that have been raised about the classification of its EpiPen injectors for the Medicaid Drug Rebate Program. The deal has also been made without the company having to admit any wrongdoing.

The EpiPen (epinephrine) injectors are used for the emergency treatment of life-threatening allergic reactions (anaphylaxis) caused by allergens, exercise or unknown triggers.

Mylan had been accused of underpaying US Government healthcare programmes by misclassifying its EpiPen emergency allergy treatment. The Centers for Medicare and Medicaid Services (CMS) and three US senators claimed that Mylan made more money on EpiPen than warranted from state Medicaid programmes by having it classified as a generic drug product, implying that it had multiple competitors, and resulting in much smaller rebates to the government health plans. Generic drug products only have to pay a 13% Medicaid rebate, compared to brand-name products that have to pay rebates of 23.1%.

The EpiPen has recently come under intense scrutiny after a series of dramatic price increases. The list price for a set of two of the company’s EpiPen injectors has increased from US$103 in 2009 to a whopping US$608 in 2016 – an increase of 480%. These price increases have been blamed for making the devices unaffordable for a growing number of families in the US.

Following a plethora of complaints and letters by senators in the US, the company announced in August 2016 that its US subsidiary would launch the first generic to EpiPen at a list price of US$300 per generic. This represents a 50% discount compared to the brand-name price, which Mylan claims, along with its augmented patient assistance programmes and the US$300 savings card, will ‘enhance affordability’ for patients [1].

This agreement with the DOJ over EpiPen Medicaid rebates resolves ‘all potential rebate liability claims by federal and state governments’, according to Mylan. The company added that ‘the terms of the settlement do not provide for any finding of wrongdoing on the part of Mylan’ or its employees. Mylan did, however, say that it will ‘continue to work with the government to finalize the settlement’, perhaps suggesting that the agreement is not quite as final as Mylan would like.

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1. GaBI Online - Generics and Biosimilars Initiative. Senators continue to raise concerns over price of Mylan’s EpiPen [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2016 Oct 21]. Available from: www.gabionline.net/Generics/News/Senators-continue-to-raise-concerns-over-price-of-Mylan-s-EpiPen

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Source: Bloomberg, Forbes, Mylan, Reuters

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