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Mylan to Pay $465 Million for Overcharging Medicaid

— October 11, 2016

EpiPen maker Mylan, Inc. has been ripping off Medicare and Medicaid for years but is only now being held accountable for their unethical, unprofessional and deceitful practices; the company has agreed to pay the government $465 million for having overcharged both insurance providers by classifying their drug as “generic,” thus reducing their percentage of the required reimbursement amount pharmaceutical companies are responsible for when they sell their drugs to Medicare or Medicaid. In the case of generic drugs, these companies are required to reimburse 13 percent of the cost, while name brand drugs (such as the EpiPen) must be reimbursed at a rate of 23.1 percent. If I understand this correctly, not only has Mylan left countless families in financial ruin by increasing the price of a 2-pak to $600, up from the $100 it cost in 2007 (which saw CEO Heather Bresch’s salary jump from just over $2 million to almost $20 million per year), they’ve also been cheating the government by claiming their drug to be generic in order to avoid paying a higher fee and now get to settle for $465 million without having to admit any wrongdoing. What is wrong with this picture besides everything?

According to the federal government, Mylan had been told repeatedly it was erroneously classifying the EpiPen as generic, which resulted in both programs overpaying for the life-saving drug, though by how much has not been disclosed. EpiPen has succeeded as it has because there is no generic version of the drug on the market to compete with, which makes the company’s actions that much more deplorable. Just when you think it couldn’t sink any lower, it turns out it’s been lurking at the bottom for years peering up in amusement at its unsuspecting and undeserving victims.

Heather Bresch testifying; image courtesy of
Heather Bresch testifying; image courtesy of

Desperately trying to save face in the midst of the ongoing EpiPen scandal, Ms. Bresch released a statement following news of the settlement which read, “This agreement is another important step in Mylan’s efforts to move forward and bring resolution to all EpiPen Auto-Injector related matters. The agreement is in addition to the significant steps Mylan has taken in relation to EpiPen Auto-Injector over the past several weeks, including the unprecedented, pending launch of a generic version of EpiPen Auto-Injector and expansion of our patient access programs for this product. Entering into this settlement is the right course of action at this time for the Company, its stakeholders and the Medicaid program.” You think so, Ms. Bresch? You think now is a good time to stop lying to the government after getting caught pilfering, but prior to the release of your company’s actual generic version? What you don’t believe is the right course of action, though, is lowering the ridiculous cost of the current EpiPen; that stays right where it is, despite the countless number of children’s and people’s lives you continue to put at risk. Got it.

Democratic Senator Amy Klobuchar of Minnesota was one of the first to question the company’s motives after the price hike. She expressed some satisfaction with the settlement, though she stated on Friday, October 7, “this must be the tip of the iceberg. If other drugs are misclassified, and surely EpiPen isn’t the only one, the public deserves to know it.” A professor from the University of Michigan’s Ross School of Business, Eric Gordon, who specializes in the study of the drug industry, indicated he believed it was in both Mylan’s and the government’s best interest to settle the matter as quickly as possible. Speaking to a reporter, he said, “They are smart to quickly end the uncertainty regarding past Medicaid pricing. The government was willing to quickly settle because there are questions about why it allowed Mylan to pay rebates it says it told the company were too low.”

That’s what I’m failing to understand in this whole situation myself. If the government knew Mylan was wrongly classifying its drug as generic, having spoken to the company about it on numerous occasions as indicated by the federal government, why did it allow it to go on for so long? Money? Greed? Total lack of understanding about how to do its job? It doesn’t add up. In my opinion, this settlement raises more questions than it answers, though one thing remains certain: Mylan continues to be a parasitic and shameful corporation. It’s doubtful that will ever change.


Mylan Agrees to Pay $465 Million for Ripping Off Medicare on EpiPens, Stock Price Soars

Mylan to Settle Epipen Overpricing Case for $465 Million

Mylan to Pay $465 Million to Settle Medicaid Claims

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