Why the EpiPen price really went up…

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photo curtesy of M on Flickr - https://flic.kr/p/7Rw1tR

EpiPen: Mylan‘s brand of epinephrine auto-injector. epinephrine is used to reverse the effects of a severe allergic reaction and save the life of those suffering an anaphylactic shock.

According to wikipedia, “Trademark names for epinephrine autoinjector devices include EpiPen, Emerade, Twinject, Adrenaclick, Anapen, Jext, Allerject and Auvi-Q”

Unfortunately… Emerade is only available in 6 countries in Europe.  Twinject was discontinued in 2012, Adrenaclick was owned by Merck KGaA which was bought by Mylan and discontinued, Anapen is not available in US, Jext is not available in US, Allerject and Auvi-Q were recalled. And a deal was struck with Phizer not to market their generic versions of the product in the US.

In short, Mylan acquired EpiPen in 2007 when they bought drug giant Merck. At the time there were half a dozen epinephrine auto-injector options available in the US and EpiPen was $57. Now, through a series of carefully planned and executed moves, EpiPen is currently the only epinephrine auto injector legally sold in the united states, and Mylan charges over $600 for the same product which uses about $1 worth of epinephrine and costs less than $5 to bring to market.


FILE - In this Sept. 17, 2013 file photo, Sen. Joe Manchin, D-W.Va., talks to reporters on Capitol Hill in Washington. Many locals around here see Manchin as one of them, so much so they greet the 30-year veteran of West Virginia politics by his first name more often than by his title. But in the Senate, the 66-year-old upstart stands out as a rare breed: A back-slapping, gun-owning Democrat who attracts widespread support from working class whites in an increasingly Republican state. (AP Photo/J. Scott Applewhite, File)
(AP Photo/J. Scott Applewhite, File)

Once made into a movie, it might just start something like this…

In a VIP alumni room at a WVU game, a West Virginia Democrat from the State congress Joe Manchin gets the founder of a pharmaceutical company to give his recent WVU graduate daughter a job. The WV state senator goes on to be WV Governor, then US senator as the daughter goes on to be Mylan’s president and soon after replaces the founder as CEO.

As republicans fight Obamacare, the Democrat Senator’s daughter successfully lobbies congress for things like more FDA involvement in business and to start new Federal programs to pay for more free healthcare. Healthcare that now, through lawsuits and legislation, primarily only her company can provide.

imageFinally using the new windfall of tax payer money her company bought up the remaining competition by purchasing US marketing rights or acquiring whole companies, as any good Wall Street hedge fund might. Finally to extract the last bit of marrow from U.S. taxpayers, she moved the company via “corporate inversion” to the Netherlands to avoid paying U.S. taxes. So, after lobbying congress to favor Mylan and their product, Bresch isn’t even willing to pay the government that made her company the second largest pharmaceutical company in the world.

mylan logoMylan N.V. now gets 40% of their profits from U.S. sales of EpiPen but they pay taxes to the Netherlands.

Facing backlash (now that America noticed) Mylan CEO, Heather Bresch says that “nobody is more frustrated” than she is.

Really? I doubt that. It seems like a well orchestrated, very successful, long-term Bond-Villian type plan.

With people on both sides of the aisle demanding accountability and cost reduction, Bresch’s current response has been to offer coupons for the insured, donate some more free samples to the uninsured and be thankful that nobody cares about the two dozen other drugs that Mylan extorted drastic increases on this year (7 were more than 100-500% increases). But Bresch is holding firm so far that there will be no price reduction for the EpiPen. Someone’s got to pay. Between insurance companies, taxpayers and individuals, someone is still going to be paying Mylan over 50,000% markup for every 300mg of epinephrine.

Rather than bleat out a tirade of my opinion on Bresch’s disingenuous statement, I’ll let you decide…

Below is a history of events following the invention of the EpiPen in the ’70’s up to today. You, the reader, decide for yourself why the price of $1 of epinephrine in $2 package now costs $600+.

Let me preface this by stating that for 40 years the price held firm around $50 until it was purchased by Mylan 8 years ago. Furthermore, the few remaining competitors’ products still sell their version for $50-100 (or less) worldwide to this day.

Mid 1970’s

Former NASA engineer, Sheldon Kaplan working at Survival Technologies invented the EpiPen to quickly and reliably inject a correct dose of epinephrin to a person suffering anaphylaxis outside of a hospital situation. (Typically in a non-emergency situation epinephrin can simply be drawn from a vial and injected with a needle.)

1991

Heather Bresch graduates from West Virginia University

1992

Bresch’s father Joe Manchin, a rising member of the West Virginia State Senate, mentioned his daughter’s job search to Mylan CEO & co-founder Milan Puskar. The company soon thereafter offered her a low-level position in the quality control department of a factory in Morgantown.

1993

Heather Bresch goes to work for Milan at Mylan

Mylan acquires Bertek Inc. (01-1993) a US-based manufacturer of transdermal drug systems. The medical products division of Bertek will provide Mylan with patents, a joint venture, and wound care and other products that will help fill the company’s pipeline in generic as well as branded areas

1996

Survival Technologies merges with Brunswick Biomedical and becomes Meridian Medical technologies

Mylan acquires UDL Laboratories, a supplier of generic medications to institutional and long-term care facilities

Heather Bresch is an MBA student at West Virginia University

1998

Bresch leaves WVU MBA school after 22 credits (out of a required 48)

December: The US Federal Trade Commission (FTC) charges Mylan Laboratories, Cambrex and two chemical suppliers with restraint of trade and a conspiracy to monopolise sales of two top-selling generic anti-anxiety drugs. The agency seeks $120m from the companies, the amount the FTC estimates they earned from alleged illegal activity.

1999

West Virginia University‘s Milan Puskar Stadium was named for him after he made a US$20 million donation.[7]

2000

July: Mylan Laboratories agreed to pay $135m plus $12m in attorney fees to settle litigation over allegations of price-fixing on drugs to treat anxiety and hypertension.

2001

Meridian introduces a two pack version of EpiPen

2002

King Pharmaceuticals acquires Meridian (and EpiPen)

Bresch promoted to Mylan’s Director of Government Relations

2003

Hollister-Stier gets FDA approval to market a competing product, Twinject

2004

Heather Bresch elected as Chairman of the Generic Pharmaceutical Association. According to the GPhA’s website…

GPhA’s core mission is to improve the lives of patients and the U.S. healthcare system by advancing timely access to affordable generic medicines. In furtherance of this mission, GPhA supports and promotes the following core objectives:

• Sustainability, growth and competitiveness of the U.S generic and biosimilars medicines industry;
• Measures that remove barriers and advance more timely patient access to FDA-approved, safe, effective and less costly generic and biosimilar medicines;
• Initiatives which promote the substitution of medicines deemed interchangeable; and
• Advancement of one high-quality standard for medicines, generic or brand, distributed in the United States.

Intelliject is founded by brothers Eric and Evan Edwards, who suffer from severe allergies, to develop medical products to treat sudden, life-threatening reactions.

King Pharmaceuticals (Parent of Meridian, inventor of EpiPen) announces plans to merge with Mylan Laboratories

When the merger is announced publicly billionaire financier Carl Icahn starts buying Mylan stock and threatening the board in an effort to stop it.

Hollister-Steir sells Twinject to Verus Pharmaceuticles

Morgantown Health Right a free clinic was renamed Milan Puskar Health Right in recognition of his generous support since its inception.[8]

Joe Manchin elected as Governor of WV

2005

Heather Bresch is elected as Chairman of the GPhA for the second year in a row.

Heather Bresch promoted to VP of Strategic Corporate Development

February: Mylan stock rose and King Pharmaceuticals‘ shares take a hit when plans to merge with Mylan Laboratories were terminated.

2007

(This is when things really start getting interesting and the Pharmaceutical industry quickly resembles the housing market hedge funds)

Mylan acquires a controlling interest in India-based Matrix Laboratories Limited, a top producer of active pharmaceutical ingredients (APIs) for generic drugs,[3] and the generics business of Germany-based Merck KGaA[4] , and with Merck, acquires the EpiPen line of epinephrine autoinjector devices,

Mylan Laboratories Inc. renames the corporation to simply Mylan Inc. 

October: Bresch is promoted to Chief Operations Officer/Executive VP and

-SIDEBAR

  • Pittsburgh Post-Gazette reported in 2007 that Bresch had claimed to have an MBA degree from West Virginia University, but the university disputed that. 
  • This became an embarrassment for the WV Governor’s Daughter and a distraction for Mylan (the company that donated $20M to WVU) and the university subsequently awarded her an EMBA despite her not having attained sufficient credits.
  • In the ensuing controversy, the university announced in April 2008 that it would rescind Bresch’s degree. Michael Garrison, WVU President at the time, was reported to be “a family friend and former business associate of Bresch”[8] and a former consultant and lobbyist for Mylan.[9] 
  • After a faculty vote of no confidence, Garrison and several university officials subsequently resigned.[10][11]

2008

Verus sells Twinject to Sciele Pharma then Sciele Pharma is bought by Shionogi

Mylan increases government lobbying expenditures five fold, from about $250k to $1.2M

2009

Milan Puskar steps down as chairman of Mylan and Bresch is appointed President

EpiPen Price increases to $103.50

Teva Pharmaceuticles along with maker of injection systems, Anteres Pharma, file to jointly market a generic EpiPen

Intelliject licenses their product to Sanofi a French Pharma co.

2010

Phizer acquires King Pharmaceuticles (Parent of Meridian, inventor of EpiPen) in a second year of “who is buying who” merger fever. see Biotech mergers of 2010

King Pharmaceuticles (Phizer) sues Teva for infringing on patents with their generic pen joint venture with Anteres

November 15, Joe Manchin leaves the WV Governor’s mansion to assume the office of West Virginia U.S. Senator.

2011

Mylan enters into an agreement with Pfizer for the exclusive worldwide rights to develop, manufacture and commercialize Pfizer’s generic equivalent to GlaxoSmithKline‘s Advair Diskus and Seretide Diskus incorporating Pfizer’s proprietary dry powder inhaler delivery platform.[18]

King (Phizer) sues Intelliject & Sanofi after they file for a New Drug Application for their previously marketed EpiPen equivalent Twinject. – Sanofi had bought Sciele Pharma which acquired Twinject from Verus Pharmaceutical who bought it from Hollister-Steir who had obtained FDA approval for the device originally in 2003

2012

Shionogi (maker of Claratin & Crestor) discontinues Twinject and Adrenaclick

Mylan spends over $4M lobbying this year

Another fine law brought to you by the good people of Mylan: The Generic Drug User Fee Act of 2012 was passed on July 9, 2012 and required FDA inspections of pharmaceutical manufacturing locations abroad if they are importing into the US,[17]  effectively blocking foreign competition for EpiPen

2013

Continued lobbying by Bresch creates yet another helpful law, the School Access to Emergency Epinephrine Act which made epinephrine more accessible in schools.[17][28] More than just accessible, this law pressed many stateds to require it. Not surprisingly, sweet home West Virginiawas one of the first. The head of the state public schools made it mandatory. Did I mention that the head of the public school system in West Virginia in 2013 was Heather Bresch’s mother? Yup, no foolin’.

April – Phizer, Mylan and Teva settle lawsuit, allowing Teva to market their product in mid 2015 (in theory), pending FDA approval

By August FDA approves Auvi-Q and with all lawsuits settled and everyone getting paid, Intelliject’s Auvi-Q device became available by prescription at pharmacies in the United States and under the name Allerject in Canada. CEO Williamson said the company is “very pleased with its adoption in the marketplace” of the Auvi-Q product in its first 12 months of sales.

http://www.consumerreports.org/drugs/how-to-get-cheaper-epipen-alternative/

Bresch / Mylan successfully lobbies to make “School Access to Emergency Epinepharine Act” law putting EpiPens in public schools and public places where defibrillators are installed.

EpiPen price increases to $264.50

2014

Following the sucess of their only product Intelliject changes their name to Kaléo and secured $150 million in debt financing from Nevada-based PDL BioPharma to develop its second product, Evzio, which is used the delivery system to reverse opioid overdoses, and for other products. The loan was backed by royalty payments from Auvi-Q however, which is no longer bringing in income since it has been recalled. Fortunately for Kaléo though their new product, self-administered opiod shots, were a hit. Who could have guessed? There’s even talk that one day they’ll reintroduce Auvi-Q.

November: In a strange game of corporate cat & mouse Mylan bids on and somewhat intentionally loses a hostile takeover bid to buy Ireland’s Perrigo as a “poison pill” to ward off its own hostile takeover from rival Teva.

2015

January: Teva buys the generic drug business (Actavis Generics[43]) from Allergan, As a result, Teva stops chasing Mylan and never does bring their competing product to market

March 2015, Impax completed its acquisition of Tower Holdings, Inc. (including operating subsidiaries CorePharma LLC and Amedra Pharmaceuticals LLC including its discontinued Adrenaclick epinephrine autoinjector)

-sidebar: incidentally, Impax was where “Pharma Bro” Martin Skrelli bought the US rights to the life saving anti-parasitic drug Daraprim which sells for pennies per pill in most of the world but now in the U.S. it is still $750 per pill and a course of treatment could run 30-100 pills. So if you need it and want to live, it’s $18.70 in Canada, $20-$40 in the UK, $75,000 in the U.S.

October 28, there was a voluntary recall of Auvi-Q and Allerject

EpiPen price increases to $461 

2016

Sanofi announces on February 23 that the License and Development Agreement between Sanofi and kaléo, formerly Intelliject Inc., the developer of Auvi-Q® and Allerject® (epinephrine injection, USP) , will terminate later this year. At that time, all U.S. and Canadian rights will be returned to kaléo.

As of June, Heather Bresch is now once again the Chairman of the Generic Pharmaceutical Association (The association whose stated mission is, essentially, to make sure that rampant abuses like this don’t happen.)

EpiPen price increases to $600+

the end 🙁

Bear in mind, EpiPen still uses the same medicine and technology invented and patented in the mid 1970’s. There has been no significant R&D or other measurable improvement in the product, despite empty generalized claims to the contrary. Nor has there been an increase in the cost or difficulty of obtaining the materials or labor to produce the product. Furthermore, though Mylan is supposedly a diversified global pharmaceutical company with over 1000 active drug products, the U.S. sales of EpiPen now account for 40% of Mylan‘s multi-billion dollar overseas profits. And what little tax they pay, is paid to the Netherlands.

So, I believe the initial question was, “Why did the price of EpiPen go from $57 to $600.”

Do you, dear reader have any insights?


I would welcome any comments corrections and/or additions and will gladly update the page if I left out links or credit.

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