EpiPen Maker to Finally Pay $465 Million for Ripping Off Taxpayers
According to Reuters , Mylan admitted no wrongdoing by agreeing to the settlement:
The U.S. Attorney's Office in Massachusetts revealed the accord on Thursday, 10 months after Mylan said it reached a deal resolving claims it misclassified the EpiPen as a
genericrather than a branded product to avoid paying rebates owed to Medicaid.
"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 a statement.
Mylan has been a poster child for the pharmaceutical industry's greed since it began hiking the price of the life-saving EpiPen allergy treatment in 2008. Over the last decade, Mylan has raised the cost of an EpiPen two pack from around $100 to over $600. Lacking generic alternatives, patients paid the extortionate price. But the craven executives also reaped the benefits of a government reimbursement program through Medicare and Medicaid. Despite not offering a generic version of its product, Mylan classified the treatment as a generic drug-meaning it only had to reimburse 13 percent of the total cost paid out by one of the government programs. If the product had been properly classified, that reimbursement amount would have been set at 23.1 percent.
to the $465 million settlement in October, but in May, a probe by the Department of Health and Human Services
that the company owed nearly three times that amount. "Mylan and the Obama Administration reportedly were close to settling the overpayment for much less than $1.27 billion," Senator
But that doesn't mean that things are turning out great for Mylan. A rival company from France called Sanofi SA originally filed the False Claims Act whistleblower lawsuit in 2016 and the company will receive a reward from the government in the amount of $38.8 million. That's small change to these large conglomerates, but it's a stick in the eye to Mylan as it watches its stock price fall. Sanofi SA sold the rights to its epinephrine injection device Auvi-Q to Kaleo who began selling it as an EpiPen alternative in April. As that and other rival products hit the market, Mylan has introduced its own generic version for $300 and seen its market share shrink from 95 percent to 71 percent in March. As of August 16th , Mylan's share price had fallen over 23 percent in a month.
Following the finalization of the settlement, Mylan Chief Executive Heather Bresch issued a statement saying, "Bringing closure to this matter is the right course of action for Mylan and our stakeholders to allow us to move forward." But with analysts downgrading the company's stock and some recommending that investors sell, it's doubtful that stakeholders are feeling relieved.