By Ransdell Pierson and Ankur Banerjee
EpiPen producer Mylan NV said on Thursday it would reduce the out-of-pocket cost of its severe allergy treatment through a discount program, a day after Democratic Presidential candidate Hillary Clinton joined lawmakers in criticizing the drug’s high price.
The company, which did not lower the drug’s list price, said it would reduce the patient cost of EpiPen through the use of a savings card, which will cover up to $300 of EpiPen 2-Pak.
The price of the product, acquired in 2007, has skyrocketed to $600 from $100 in 2008. For patients previously paying the full list price, the card effectively reduces their out-of-pocket cost exposure by 50 percent, Mylan said.
The company said it is also doubling the eligibility for its patient assistance program, which will eliminate out-of-pocket costs for uninsured and under-insured patients and families.
Clinton “welcomes the fact that Mylan is now apparently open to taking steps to lower some of the cost-sharing burdens imposed on families,” Tyrone Gayle, a spokesman for the Clinton campaign, said in a statement.
However, he added, “discounts for selected customers without lowering the overall price of EpiPens are insufficient, because the excessive price will likely be passed on through higher insurance premiums.”
Clinton’s view was echoed by Democratic lawmakers, including Rep. Elijah Cummings, who said Mylan’s move is nothing but a public relations stunt that does nothing to help the majority of patients who need the drug.
“Offering a meager discount only after widespread bipartisan criticism is exactly the same tactic used by drug companies across the industry to distract from their exorbitant price increases,” he said in a statement. “Nobody is buying this PR move anymore.”
Mylan Chief Executive Heather Bresch, defending EpiPen’s price in an interview on Thursday on CNBC, said her company had spent hundreds of millions of dollars improving EpiPen, including making its needle invisible, since acquiring the device from German generic drugmaker Merck KGaA.
“When we picked up this product, they (Merck) weren’t spending a dollar on it,” said Bresch,
Bresch said Mylan recoups less than half of EpiPen’s list price because pharmacy benefit managers, which often require discounted prices or rebates from drugmakers, are involved, along with insurers and others.
Democratic U.S. Senator Amy Klobuchar said Mylan’s action was a “welcome relief” to many who are struggling to afford the medication, but said it does not address the root of the problem of rising drug costs.
Clinton on Wednesday called on Mylan to voluntarily cut EpiPen’s price. Her comments helped push down biotech stocks. Mylan shares fell more than 10 percent this week before rising 3.2 percent on Thursday after announcement of the discount program.
Clinton’s comments came after a bipartisan group of lawmakers called for investigations into the price increase of EpiPens, which are preloaded injections of epinephrine (adrenaline) used in case of a dangerous allergic reaction that could cause death if untreated.
On Wednesday, Republican Senator Susan Collins and Democratic Senator Claire McCaskill requested that Mylan provide a briefing to explain the price change.
A group of lawmakers said on Wednesday they had written the U.S. Food and Drug Administration asking about its approval process for alternatives to the EpiPen.
Mylan is the latest company to be lambasted for apparently egregious drug price increases. Valeant Pharmaceuticals International Inc was caught in a whirlwind of criticism after it dramatically increased the price of a heart drug. In March, Clinton released a campaign ad vowing to target the company.
She has also sharply criticized Turing Pharmaceuticals for raising the price of an antiviral medication commonly used by AIDS patients and pregnant women, to $750 from $13.50 a tablet.
Turing was led by Martin Shkreli, who became the poster child for the issue of soaring prices for prescription medications. He has since stepped down as CEO of Turing.
Bresch, daughter of Democratic U.S. Senator Joe Manchin of West Virginia, said she contacted members of Congress over the past two days and asked to meet with them to discuss what she called an “unsustainable” drug pricing system.
She said one of the calls was to Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, who recently wrote a letter to Mylan asking for an explanation of big EpiPen price increases.