Mylan Pharmaceuticals is scrambling to do some serious damage control after reports last week of raising the cost of life-saving EpiPens to over $600 for a two-pack, and how CEO Heather Bresch gave herself a pay raise from $2 million to over $18 million. Stocks have plummeted by more than $3 billion in the last week, according to U.S. Uncut, and the pharmaceutical company now claims they have cut the price of EpiPens by 50 percent in response to public outcry, but this is not entirely accurate.
U.S. Uncut revealed that the response by Mylan is misleading, as the market cost of EpiPens remains the same. Uninsured and underinsured consumers requesting an EpiPen are given a $300 savings card to lower the cost, but Mylan is still charging full price to insurance companies, which contributes to increasing costs for health insurance.
To add further insult to injury in consumers’ minds, multiple media outlets revealed that Mylan performed an inversion deal to legally move their base to the Netherlands, despite the physical headquarters remaining in the U.S. The deal is a move becoming more common in business, allowing Mylan to drastically slash U.S. taxes, according to Pittsburgh Business Times , even as they reap the rewards of Bresch’s work as a lobbyist before becoming CEO. Bresch, the daughter of U.S. Senator Joe Manchin of West Virginia, advocated successfully for legislation requiring all public schools to keep EpiPens on hand for those students with allergies. Once the 2013 School Access to Emergency Epinephrine Act was in place, Mylan escalated its price increases, raising the price of EpiPens at least 10 percent every other quarter since 2013, until the recent price hike that sparked the current public furor.
While Mylan is price gouging its EpiPen, it’s also dodging taxes. Read more here -> https://t.co/fIBRzbYtF2 pic.twitter.com/GYk8Q3JNcL
— 4TaxFairness (@4TaxFairness) August 25, 2016
According to U.S. Uncut , Mylan continues receiving taxpayer funding through federal programs intended to offset consumer costs, such as Medicaid and the Children’s Health Insurance Program. And yet, Mylan raised the cost of this crucial emergency medication from $104 in 2009 to $609 in 2016.
The EpiPen delivers an injection of epinephrine to those suffering from severe allergic reactions to food or bee stings, known as anaphylactic shock. The swelling of the throat that often happens can close off the airway and cause death in minutes, hence the need for having an EpiPen on hand at all times for those prone to such a severe reaction.
Bresch continued defending the company’s huge price increase, dodging questions in a Thursday morning interview about her own 671 percent salary increase.
“We have been a long-term, committed partner to the allergy community and are taking immediate action to help ensure that everyone who needs an EpiPen Auto-Injector gets one.”
Mylan CEO to CNBC on EpiPen controversy: “No one is more frustrated than I am.” https://t.co/kEGDc8L0oU pic.twitter.com/IC81mplgUv
— CNBC Now (@CNBCnow) August 25, 2016
The U.S. Senate Judiciary Committee has called for a hearing into the price increases by Mylan, but as CNBC reported, some of those involved with any potential investigation have taken donations from a Mylan PAC.
“The Mylan Inc. PAC has given $13,500 to four current members of the Senate Judiciary Committee since 2014, including $5,000 to ranking Democrat Patrick Leahy of Vermont and $5,000 to the Senate’s likely next Democratic leader Chuck Schumer of New York. Since 1999, the PAC has donated more than $60,000 to 11 current members of the 20-person judiciary committee. Most of those donations came after 2008.”
Many are now comparing Bresch and Mylan Pharmaceuticals to the notorious price hike by former Turing Pharmaceuticals CEO Martin Shkreli that earned him the nickname of “Pharma Bro.” Shkreli increased the price of a medication for AIDS patients from $13.50 per pill to over $750 per pill overnight. Shkreli is no longer with Turing after the huge PR fallout, and is currently facing charges of securities fraud.
[Photo by Mark Zaleski/AP Images]
