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Mylan Settles EpiPen Pricing Claims for $465M

Mylan Settles EpiPen Pricing Claims for $465M

Mylan has agreed to pay $465 million to resolve allegations that it knowingly misclassified its branded EpiPen as a generic drug to avoid paying rebates owed to Medicaid, the U.S. Attorney's Office in Boston has announced.

"Taxpayers rightly expect companies like Mylan that receive payments from taxpayer-funded programs to scrupulously follow the rules", Acting U.S. Attorney William Weinreb said in an August 17 statement from the DOJ. Her salary rose from $2.4 million in 2007 to almost $19 million in 2015. The lawsuit argues that the 17 price increases that Mylan imposed since acquiring the EpiPen in 2007 - an overall markup from $90.28 to $608.62, amounts to a "behind-the-scenes quid pro quo arrangement" that was created to increase profits at the expense of patients.

The deal followed a False Claims Act whistleblower lawsuit filed by French rival Sanofi SA (SASY.PA) in 2016, two years after it first raised the matter with authorities, Weinreb's office said.

Mylan CEO Heather Bresch commented, "As we said when we announced the settlement past year, bringing closure to this matter is the right course of action for Mylan and our stakeholders to allow us to move forward".

It's the second settlement with the Department of Justice that Mylan has made since 2009 for allegedly overcharging the government for its medicines.

Mylan drew widespread criticism past year from consumers, health care providers and public officials for raising the price of an EpiPen two-pack to $600, up from $100 in 2008.

It therefore subjected such single-source, or brand name drugs, to a higher rebate that is payable to Medicaid and that increases to the extent the price of the drug outpaces the rate of inflation.

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Mylan has since offered its own generic version for about $300.

But not all of the settlement will go to taxpayers - at least $38.7 million of the federal allocation, and some of the states' allocations, will go to the drug company Sanofi, which used to sell the Auvi-Q, a competing product, and who brought this issue to the government's attention.

"Our five-year corporate integrity agreement requires intensive outside scrutiny to assess whether Mylan is complying with the rules of the Medicaid Drug Rebate Program", said Gregory E. Demske, Chief Counsel to the HHS Inspector General.

"Mylan's agreement with [Centers for Medicare & Medicaid Services] to correctly classify EpiPen is a huge win for Medicaid beneficiaries and American taxpayers", CMS Administrator Seema Verma said in a statement.

Health and Human Services Secretary Tom Price, M.D. released the following statement today after the announcement of an agreement with Mylan, the manufacturer of EpiPen to reclassify the auto injection medical device, a move that will save taxpayers hundreds of millions of dollars.

The settlement provides for resolution of all potential Medicaid rebate liability claims by the federal government, as well as potential claims by certain hospitals and other covered entities that participate in the 340B Drug Pricing Program. The settlement also funds Medicaid programs in all states and creates a framework for resolving reimbursement claims.


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