EpiPen Maker In Hot Water For Price Gouging AGAIN
Mylan and Sun Pharmaceuticals face two lawsuits alleging the companies colluded to gouge consumers for a generic pill used to treat asthma and other respiratory problems.
The lawsuits claim Mylan raised the price of its 2 mg pills of generic asthma medicine by 1,000 percent, going from $0.17 in December 2012 to $5.55 in December 2013. Sun Pharmaceutical allegedly raised the price of their generic pills from $0.30 to $4.42 during the same time frame.
Some 25 million Americans, nearly 8 percent of the U.S. population, suffer from asthma, according to American Academy of Allergy, Asthma & Immunology.
Mylan made headlines in August 2016, when it was discovered that its CEO, Heather Bresch, daughter of Sen. Joe Manchin, raised the price of EpiPens 461 percent since acquiring the drug in 2007. When Mylan purchased rights to the device in 2007, the cost of the drug to consumers was just $56.64. By 2015, Bresch had spiked the price to $317.82. The price of the epinephrine inside the EpiPen is $1. (RELATED: Mylan EpiPen Maker Faces Antitrust Investigation)
In the first two years (2008 and 2009), Bresch raised the price 5 percent a year. At the end of 2009, she hiked the price 19 percent. For the next three years, she raised the price at a steady rate of 10 percent a year, reports CBS News. EpiPen profit margins were 55 percent in 2014, up substantially from 9 percent in 2009, according to Bloomberg. EpiPens account for nearly 40 percent of Mylan’s operating profit.
Sens. Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts have taken up arms against Big Pharma, making the issue of price gouging a topic of national discourse.
Warren slammed Mylan in August 2016 due to the pricing of the EpiPen.
“These changes will help some customers who are struggling to afford EpiPens. Your discount programs, however, represent a well-defined industry tactic to keep costs high through a complex shell game,” Warren wrote in a letter to Bresch.
The Massachusetts senator also lambasted Valeant Pharmaceuticals in 2016 for price gouging.
“You double the price [of a drug] even if you get a waiver to the customer, you make a lot of money,” Warren said. “By doing this you … keep the patient on the more expensive drug and then you … recoup whatever from the insurance company.”
Sanders used the example of albuterol sulfate tablets to illustrate what is wrong with the pharmaceutical industry in a 2014 Senate investigation into why generic drug prices are skyrocketing.
“It is unacceptable that Americans pay, by far, the highest prices in the world for prescription drugs. Generic drugs were meant to help make medications affordable for the millions of Americans who rely on prescriptions to manage their health needs. We’ve got to get to the bottom of these enormous price increases,” Sanders said.
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