How EpiPen’s maker raised prices, and hackles, so much
ASSOCIATED PRESS
Price hikes for the emergency medicine have made its maker, Mylan, the latest target for patients and politicians infuriated by soaring drug prices.
TRENTON, N.J. >> Sky-high price hikes for EpiPen, the injected emergency medicine for severe allergic reactions to foods and bug bites, have made its maker the latest target for patients and politicians infuriated by soaring drug prices.
The company, Mylan, has a virtual monopoly on epinephrine injectors, potentially life-saving devices used to stop a runaway allergic reaction. Mylan N.V., which has headquarters in Hertfordshire, England, and Pittsburgh, has hiked prices as frequently as three times a year over the past nine years, pushing its list price for a package of two syringes to more than $600.
A look at the situation:
Q: Who uses EpiPens?
Roughly 40 million Americans have severe allergies to spider bites, bee stings and foods like nuts, eggs and shellfish. They at risk for a serious reaction — anaphylactic shock. Symptoms quickly escalate from wheezing, hives and skin swelling to rapid heartbeat, trouble breathing and convulsions and, without treatment, possibly death.
As a precaution, many carry EpiPens, which contain the best “antidote,” the hormone epinephrine. Last year, more than 3.6 million U.S. prescriptions for two-packs of EpiPens were filled, according to data firm IMS Health. That earned Mylan nearly $1.7 billion.
Q: How do EpiPens work?
A: In an emergency, the syringe is jabbed against the thigh. The needle inside injects the epinephrine into muscle tissue. But that can be difficult in a panic or with a child who won’t hold still. The syringes expire after a year.
Q: How did the price for EpiPens get so high?
Like all drugmakers, Mylan periodically hikes its prices. In 2007, when Mylan took over rights to EpiPen, a pair of syringes cost $93.88. According to Elsevier Clinical Solutions’ database of prices set by manufacturers, Mylan raised the price 5 percent the in 2008 and 2009, when a competitor hit the market. Its price jumped 20 percent in late 2009, followed by a series of 10 percent and 15 percent increases. The price hit $609 per pair in mid-May.
Q: How can Mylan do that?
A: In the U.S., drug manufacturers charge what they think the market will bear. Unlike other countries, the U.S. government doesn’t regulate drug prices, though the Veterans Affairs and Medicaid negotiate big discounts. Mylan hasn’t answered questions about how it justifies its price hikes. A statement released Monday didn’t address prices.
Q: What do people really pay?
A: It depends on an individual’s insurance coverage. Private insurers often negotiate discounts off the list price, and patient out-of-pocket costs vary by plan. But patients with high-deductible plans or no insurance can pay list price or more, depending on the pharmacy. In its statement, Mylan said most customers have insurance that limits their copayments, or they can use a copay discount card to save $100.
The statement recommended that people review their coverage. It also says that since 2012, Mylan’s EpiPen4Schools program has given schools more than 700,000 free EpiPens.
Q: Isn’t there any competition?
A: Barely, and few people know about it. One cheaper product remains on the market, Adrenaclick. But EpiPen, introduced in 1987, is so well known that most doctors prescribe it without considering Adrenaclick, and pharmacists can’t substitute that for EpiPen, said Evelyn Hermes-DeSantis, director of drug information services at Rutgers University’s pharmacy school. A pair of Adrenaclick syringes costs $142 to $380 at pharmacies, according to online comparison sites.
EpiPen has a U.S. patent giving it a monopoly until 2025, according to Evercore ISI analyst Umer Raffat. Generic maker Teva has permission to launch a version but hasn’t gotten regulatory approval yet. A rival injector called Auvi-Q was recalled last year because of potential inaccurate dosing, Raffat noted, and a third product has twice been rejected because of issues with the injector.
Q: Is there another alternative?
A: Some people get prescriptions for epinephrine vials and get a doctor to put it in syringes. But Rutgers’ Hermes-DeSantis said that raises concerns about sterility and proper storage.
Q: Why is there such a furor now?
A: Drug prices are a hot topic in the presidential race, and Congressional committees have been investigating eye-popping increases by other companies. New drugs for cancer and rare diseases can cost hundreds of thousands of dollars and older drugs, even some generics, have had unprecedented price spikes. With the increase in high-deductible insurance plans, more people are paying the full cost of prescriptions. And the back-to-school season means some families are facing sticker shock as they buy new EpiPens to keep at their child’s school.
14 responses to “How EpiPen’s maker raised prices, and hackles, so much”
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More price gauging. The FED. Gov. needs to regulate this or generics should be allowed now and Mylan’s patent revoked. Actually, patents should not be allowed for these kind of drugs where it wasn’t very costly to develop or manufacture. There is no excuse.
A big part of this is the vicious cycle in which US pharmaceutical companies charge lower prices to other countries as they have laws that prevent overpricing. So they turn around and offset it through the higher prices on US consumers. It is a sad state of affairs in our country that this is even allowed. But we all know that Big Pharma wield big power through lobbying of government officials who are supposed to be watching out for the consumers. Instead, they rely on the donations from these pharmaceutical companies for their campaign chest. I would be interested in who donates to our politicians and how much. That should be put out in the open so that voters can decide better who is for them and who is not. Until our government steps in to protect its own citizens this type of situations will continue to be a problem and the fact that many of these pharmaceutical companies are now offshore will make this even more of a problem.
Of course those donations are already out in the open. That’s all disclosed.
Another thing that is disturbing to me is that these pharmaceutical companies have great influence on our doctors through the gift of pens, pads, wall clocks and even food. And when I say food, I mean meals delivered to doctors’ offices by these people promoting their companies. This would explain why generic or lower priced brands are overlooked when doctors prescribe medications. The government should make these kind of undue influences illegal. They should not be allowed to “wine and dine” doctors and their offices with gifts such as these. It is just unethical.
That’s called “lobbying”. Same thing going on in government. Nothing is going to change. Gruber inaction.
We need a single pay system. We don’t have a free market system now so it is not like we are losing anything.
“Single Pay” well well that “Single Pay” has not worked for the Veterans Admin medical, What makes you think it wold fare better for other concerns?
Blame the FDA which “protect” us and guarantee the monopoly. With all the destruction that has happened as the government has attempted to “solve” the health care industry maybe we should reconsider before it gets much worse, because it will get much worse as the State will take over more and more. Time to reject these central planners and pursue free market ideals and then we will see real growth in health care and technology.
noheawilli – You have it all wrong. Congressional members are the lapdogs to Big Pharma. Receiving huge bribes/campaign contributions from lobbyists, congressional bureaucrats do as they are told by their bosses. They willfully limit the power of the FDA, other government agencies.
This is exactly what happened with the recent medical compounding disaster where people died. Controlled by lobbyists, congress refused to give the FDA the power to inspect and regulate the compounding labs. Industry said they could do it. Yes, they sure did. People died thanks to their utter incompetence. Only after this debacle did congress start to give FDA the power it asked for. Innocent people died so members of congress could basically take bribes. All about taking care of #1.
http://www.nytimes.com/2013/11/19/us/bill-on-regulating-drug-compounding-clears-senate.html?_r=0
This happens when a company has a monopoly situation. Consumers pay, dearly. Only good competition keeps prices fair and quality increases.
Found them before, MUCH lower, through Canadian pharmacies. Is the “US” patent is “supposedly” the problem – buy elsewhere.
It helps that the father of the “head” of Mylan is also the US Sen from West Virginia by the name of Joe Manchin. Her whole raise in the company is very interesting.
An utterly incompetent, legend in his own mind career bureaucrat who has only one goal. Taking care of #1 first.
People who voted for him, the ones he is supposed to represent? Let them eat cake.
I hope this is a wake up call to stop price gouging. This is just ridiculous! The article doesn’t mention that top executives received outrageous pay increases. The CEO got a 671% increase within eight years!
http://www.nbcnews.com/business/consumer/mylan-execs-gave-themselves-raises-they-hiked-epipen-prices-n636591