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You can find the current article at its original source at https://www.theguardian.com/business/2016/sep/21/epipen-price-hike-mylan-ceo-congress-heather-bresch
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| Mylan CEO expected to defend EpiPen price hikes before Congress | |
| (35 minutes later) | |
| The boss of EpiPen manufacturer Mylan Pharmaceuticals will attempt to shift blame for the company’s decision to implement huge price hikes on its lifesaving devices to health insurers and others at a congressional hearing Wednesday. | The boss of EpiPen manufacturer Mylan Pharmaceuticals will attempt to shift blame for the company’s decision to implement huge price hikes on its lifesaving devices to health insurers and others at a congressional hearing Wednesday. |
| Heather Bresch, chief executive of Mylan, is set to appear before Congress to explain Mylan’s pricing of EpiPen and the profits the company has made off of the device. | Heather Bresch, chief executive of Mylan, is set to appear before Congress to explain Mylan’s pricing of EpiPen and the profits the company has made off of the device. |
| Mylan came under scrutiny after it was reported that the company had increased the price of its devices, used to treat life-threatening allergic reaction, from $56.64 in 2007 to $317.82. Since EpiPens are usually sold as a two-pack, the total cost can be more than $600. | Mylan came under scrutiny after it was reported that the company had increased the price of its devices, used to treat life-threatening allergic reaction, from $56.64 in 2007 to $317.82. Since EpiPens are usually sold as a two-pack, the total cost can be more than $600. |
| In her testimony to the House committee on oversight and government reform, Bresch is set to defend the price increases, noting that Mylan only makes about $50 in profit per pen while making the life-saving device available and raising awareness about anaphylaxis. Anaphylaxis is an allergic reaction that causes one’s airways to swell and close. Epinephrine, a drug which is used to treat anaphylaxis, is cheap but must be delivered in the proper dose. Mylan’s EpiPen quickly delivers a proper dose of epinephrine in emergency situations. | In her testimony to the House committee on oversight and government reform, Bresch is set to defend the price increases, noting that Mylan only makes about $50 in profit per pen while making the life-saving device available and raising awareness about anaphylaxis. Anaphylaxis is an allergic reaction that causes one’s airways to swell and close. Epinephrine, a drug which is used to treat anaphylaxis, is cheap but must be delivered in the proper dose. Mylan’s EpiPen quickly delivers a proper dose of epinephrine in emergency situations. |
| “For millions of families, the presence of an EpiPen Auto-Injector in a purse, briefcase, backpack or medicine cabinet is a source of enormous comfort and an invaluable insurance policy against a potential tragic event. It troubles me greatly that the EpiPen product has become a source of controversy,” Bresch wrote in prepared testimony released ahead of the meeting. “At the same time, the issue of EpiPens has two equally critical dimensions – price and access. With the current focus on pricing, I’m very concerned that the access part of the equation is being minimized.” | “For millions of families, the presence of an EpiPen Auto-Injector in a purse, briefcase, backpack or medicine cabinet is a source of enormous comfort and an invaluable insurance policy against a potential tragic event. It troubles me greatly that the EpiPen product has become a source of controversy,” Bresch wrote in prepared testimony released ahead of the meeting. “At the same time, the issue of EpiPens has two equally critical dimensions – price and access. With the current focus on pricing, I’m very concerned that the access part of the equation is being minimized.” |
| According to Bresch, Mylan has reached more than 80% more patients. She added that “approximately 85% of EpiPen patients pay less than $100 for a two-unit package and a majority pay less than $50”. | According to Bresch, Mylan has reached more than 80% more patients. She added that “approximately 85% of EpiPen patients pay less than $100 for a two-unit package and a majority pay less than $50”. |
| EpiPen is not the only product whose price Mylan has hiked. According to an investors’ note by a Wells Fargo senior analyst, David Maris, this year Mylan hiked prices of two dozen products by 20%. Since the drugs are used to treat afflictions such as irritable bowel syndrome, overactive bladder and gallstones, there was little coverage or outcry. | EpiPen is not the only product whose price Mylan has hiked. According to an investors’ note by a Wells Fargo senior analyst, David Maris, this year Mylan hiked prices of two dozen products by 20%. Since the drugs are used to treat afflictions such as irritable bowel syndrome, overactive bladder and gallstones, there was little coverage or outcry. |
| Mylan has insisted that its business model is not premised on price hikes and that the price hikes are due to the increase in costs of doing business in the US healthcare system. | Mylan has insisted that its business model is not premised on price hikes and that the price hikes are due to the increase in costs of doing business in the US healthcare system. |
| In August, Bresch compared healthcare to the mortgage crisis. She explained that since EpiPens passed through various “hands”, such as retailers and pharmacy benefits managers, the cost became inflated by the time they reached the counters. | In August, Bresch compared healthcare to the mortgage crisis. She explained that since EpiPens passed through various “hands”, such as retailers and pharmacy benefits managers, the cost became inflated by the time they reached the counters. |
| “What Mylan takes from that, our net sales is $274, so $137 per pen,” she said at the time. | “What Mylan takes from that, our net sales is $274, so $137 per pen,” she said at the time. |
| On Wednesday, she attempted to once again explain the profit that Mylan makes off of EpiPens. | On Wednesday, she attempted to once again explain the profit that Mylan makes off of EpiPens. |
| “I think many people incorrectly assume we make $600 off each EpiPen. This is simply not true. In the complicated world of pharmaceutical pricing, there is something known as the Wholesale Acquisition Cost, or WAC. The WAC for a two-unit pack of EpiPen Auto-Injectors is $608,” she said. “After rebates and various fees, Mylan actually receives $274. Then you must subtract our cost of goods, which is $69. This leaves a balance of $205. After subtracting all EpiPen Auto-Injector related costs, our profit is $100, or approximately $50 per pen.” | “I think many people incorrectly assume we make $600 off each EpiPen. This is simply not true. In the complicated world of pharmaceutical pricing, there is something known as the Wholesale Acquisition Cost, or WAC. The WAC for a two-unit pack of EpiPen Auto-Injectors is $608,” she said. “After rebates and various fees, Mylan actually receives $274. Then you must subtract our cost of goods, which is $69. This leaves a balance of $205. After subtracting all EpiPen Auto-Injector related costs, our profit is $100, or approximately $50 per pen.” |
| That’s slightly less than the $56.64 that EpiPen cost when Mylan acquired its maker, Merck KGaA, in 2007. | That’s slightly less than the $56.64 that EpiPen cost when Mylan acquired its maker, Merck KGaA, in 2007. |