The recent EpiPen price hike has placed an unexpected financial burden on families and allergy sufferers across the nation. The price hike came at a time that parents would likely be purchasing an extra set of EpiPens for schools and daycare, causing many families to spend as much as their mortgage payment to ensure their child has the lifesaving devices when they are away from home. However, Mylan CEO Heather Bresch says the costs are justified and that the price hike is responsible for making “the world a better place.”
Mylan CEO Heather Bresch sat down for an interview with CNBC’s Squawk Box on Thursday to discuss the price increase of the EpiPen. As NBC reports, Mylan claims that “no one is more frustrated than me” about the unexpected price hike, while noting that “everybody should be frustrated.”
While Mylan says she is “frustrated” with the “necessary” price hikes, she didn’t seem to mind taking a significant pay increase over the last eight years as EpiPen prices skyrocketed over 1000 percent. As the Inquisitr previously reported, prices for the EpiPen started at just $56.64 back in 2007 when Mylan purchased the rights to the device. However, the prices were raised 400 percent between 2007 and the beginning of 2015. In May of 2015, the company increased the price again by 75 percent and then hiked them once more the second quarter of 2016, bringing the price to an astonishing $608.61 per EpiPen.
As prices increased, Mylan CEO Bresch increased her own pay from $2.4 million to $18.9 million, an increase greater than sevenfold. Meanwhile, allergy sufferers and families struggle to choose between putting more food on the table or purchasing the lifesaving device. Bresch seems to have no financial woes as the price increase has landed her a solid pay increase over the years.
Bresch’s pay is heavily associated with the EpiPen as 40 percent of Mylan’s revenue comes from the device. Therefore, Bresch’s statements that “no one is more frustrated than me” is being viewed as a slap in the face to many parents struggling to purchase the devices for their children.
— Sharon L Bober (@DrSharonBober) August 25, 2016
She’s frustrated? During the same period the Epipen’s price has increased, her salary has gone from $2.5M to $19M.???? https://t.co/cZIVOtGjUs
— Copy McPasty, Writer (@KashannKilson) August 25, 2016
— Graham Stanley (@StanLeeGee) August 25, 2016
Mylan CEO Bresch https://t.co/31mPshLVD2 What she meant was, “No one’s more frustrated than me at having to live on $16M per year!”
— ldrider (@ldrider) August 25, 2016
— Kelly Elliott (@kellyelliottmcm) August 25, 2016
Bresch says that there is a valid reason that the EpiPens have increased so significantly in price noting that one reason that prices are so high for Americans is that “as a country we’ve made a conscious decision” to subsidize the rest of the world’s EpiPen use. Bresch goes on to say that the EpiPen’s rising prices in the United States are making “the world a better place.”
“We do subsidize the rest of the world… and as a country we’ve made a conscious decision to do that. And I think the world’s a better place for it.”
Bresch notes that in countries with government-run healthcare limit the drug prices charged by manufacturers. Therefore, she says EpiPens are capped at $100 to $150 in these countries. Therefore, she says that Americans are essentially subsidizing the cheaper pens in government-run healthcare nations, something she says is noble and that we have collectively decided to do as a nation.
However, is that true? Jacob Sherkow, an associate professor at New York Law School, discussed the issue with the International Business Times last year noting that if price controls are put into place in the United States, pharmaceutical companies would have no place to distribute the costs associated with research and development.
“U.S. consumers are in fact subsidizing other countries’ public health systems, at least with respect to drug pricing.”
Sherkow notes that 46 percent of the global life sciences research and development, the vast majority being in the pharmaceutical industry, is performed in the United States and funded by Americans.
“Pharmaceutical companies have long defended the high price of drugs as necessary to pay for the research and development of new drugs, but the differences in pricing essentially means that consumers in the U.S. are contributing more than those in other countries.”
In other words, with the United States being one of the few developed countries remaining that does not have government mandated pharmaceutical prices, the vast majority of research and development costs are placed on U.S. citizens.
While pharmaceutical companies often use research and development costs and subsidizing of other countries’ lower priced drugs as reasons for excessive drug prices in the United States, many critics aren’t buying that explanation. Many people note that the high salaries of top pharmaceutical executives are proof that the drugs are simply overpriced.
“Although drug companies insist they need to charge high prices in order to fund R&D, critics point to exorbitant profits and executive pay at pharmaceutical companies as proof that drugs are simply overpriced and that the claim of needing to fund R&D is merely a front.”
Critics also note that while research and development can come at a high price, many pharmaceutical companies are spending more on marketing than on R&D, meaning excessive sales and marketing costs could be pushing costs up which are also being passed along to the American buyers.
— Makovsky (@makovsky) April 14, 2015
As prices are raised, many allergy sufferers are looking for EpiPen alternatives. The Inquisitr notes that there are currently two alternatives to the device, the Adrenaclick and a generic USP auto-injector. These devices run half to one-fourth the price of an EpiPen and are administered in a similar fashion. However, new training of caregivers would be required if the switch is made. For those looking for coupons for the EpiPen, Mylan is offering a free two-pack of EpiPens to anyone who has an income of 200 percent the Federal Poverty Level or less. The company claims this limit will be increased to 400 percent the Federal Poverty Level soon.
What do you think about Mylan CEO Heather Bresch’s statements that EpiPen price hikes are making the “world a better place?” Do you agree with her assessment that Americans have collectively made a “conscious decision” to subsidize the rest of the world’s in regards to pharmaceuticals?
[Image via iStock]