Congressional Dems Attack Drug CEO over Company’s ‘Profits’

Mylan CEO Heather Bresch seemed undaunted yesterday as she stood before a congressional hearing and recounted all the reasons why her company’s life-saving allergy-reaction injector was not as profitable as critics claim, even though her company had raised the price six-fold since 2009.

EpiPen, which is stocked by individuals and is required by many schools around the country, and also requires regular replacement when it expires, cost $100 for a two-pack in 2009. Today the price is $608, causing Rep. Elijah Cummings (D-Md.) to tell the House Oversight Committee hearing Mylan raised the injector to:

“to get filthy rich at the expense of our constituents.” Watch below.

Bresch did not apologize, though, and instead told the Committee:

“I know there is considerable concern and skepticism about the pricing. I think many people incorrectly assume we make $600 off each EpiPen. This is simply not true.”

She continued by saying her company receives only $274 per two-pack after rebates and fees are deducted and when factoring in the cost of goods and other related costs, Mylan only realizes a  profit of $100 per two-pack.

A quick legislative fix is unlikely, however, Rep. Jason Chaffetz (R-Utah), chairman of the committee, told the Food and Drug Administration (FDA) to remove bureaucratic hurdles to innovation which may be blocking competitors – in other words, the solution is more competition. Indeed, the agency recently delayed a prospective alternative to EpiPen offered by Teva Pharmaceutical Industries, leaving the Mylan monopoly on the life-saving device the only option for consumers.

Devon Herrick, Ph.D., an expert on 21st century medicine, including the evolution of Internet-based medicine, consumer driven health care and key changes in the global health market, told Daily Surge there is already a generic epinephrine auto-injector — AdrenaClick, which can be purchased at Walmart or Sam’s Club for about $145 with a GoodRx.com coupon.

“In most states a pharmacist cannot substitute one for an EpiPen if the doctor prescribed an EpiPen by name,” Herrick said. “Doctors may not even be aware of the generic or simply prefer to prescribe the one they are familiar with.”

Herrick says drug maker Mylan also has a highly effective marketing campaign raising awareness of anaphylaxis — scaring parents into believing it is more deadly than the data shows.

“I’ve researched the medical literature and anaphylaxis is rarely fatal,” he said. “About 2,000 cases per year results in a little more than 200 deaths, and about two-thirds of those deaths are adults, mainly seniors with reactions to drugs and medical imaging agents. Plus, people usually have time to get to an ER or get to a first responder. Years ago my wife had an anaphylactic reaction and more than an hour lapsed before she got to the ER, yet she was fine. Americans spend more than $1 billion on EpiPens every year, most of which expire unused.”

The epinephrine in an EpiPen costs less than $1, Herrick says, the delivery device (an auto-injector) is what allows Mylan to charge high prices for the EpiPen. The EpiPen auto-injector was originally invented in 1977 for the military to quickly inject antidotes for chemical nerve agents, and the early model EpiPen lost patent protection nearly 20 years ago. Sheldon Kaplan, the original inventor, developed a newer model which was patented in 2004, but the FDA is not going to approve an epinephrine auto-injector that is not based on the newer design.

Herrick agrees with Rep. Chaffetz, placing much of the blame for high EpiPen prices on the FDA, which treats epinephrine auto-injectors like high-tech devices which have mere seconds to work before someone dies.

“There are numerous other auto-injectors with FDA’s approval to market to patients who don’t like to give themselves shots, but these are not prefilled with epinephrine,” he said.

Drug maker Teva tried to get an epinephrine auto-injector approved and was turned down pending some issues the FDA wants resolved. It will not be ready until 2018. Another model (Sanofi’s Auvi-Q) was recalled after a couple dozen of its units allegedly administered inaccurate doses.

“There was never any proof these units were actually defective or verified to be non-functioning,” Herrick said.

A simple epinephrine auto-injector should be available over the counter, he said. If allowed, an OTC generic EpiPen would probably cost $10 or $20 rather than $300 apiece.

The FDA appears to be running cover for their friends in the marketplace. Crony-capitalism is alive and well with the Obama Administration.


Kenneth Artz

Kenneth Artz

Kenneth Artz is a news reporter for The Heartland Institute, covering health care, energy and the environment, education, and budget & tax news. He has over 20 years’ experience in nonprofit organizations, publishing, newspaper reporting, and public policy advocacy, and has worked as a newspaper reporter for several papers in Texas, and as a writer/editor for the National Center for Policy Analysis.

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