EpiPen Price Figures: Mylan Accused Of Bilking Medicaid Program By Misclassifying Drug, Holding Back Rebates

Medicaid officials said drugmaker Mylan NV, which has been the focus of controversy over its EpiPen pricing policy, bilked taxpayers of a substantial sum by overcharging Medicaid for the life-saving devices.

Medicaid spent $960 million on EpiPens from 2011 to 2015, the Centers for Medicare and Medicaid Services reported. When Medicare Part D is added in, the total goes to nearly $1.3 billion. The total includes 13 percent in rebates, but CMS said the program should have received a 23.1 percent discount plus the difference between the rate of inflation and any price increase since EpiPen is a brand name drug without any generic equivalent.

Mylan acquired the drug in 2007 and has been raising the price steadily since. The price has gone from $100 for a two-pack in 2007 to $608 this year.

“Today’s letter is more evidence that while Mylan irresponsibly raised the price of EpiPen, they were also bilking taxpayers out of millions of dollars,” Sen. Ron Wyden, D-Ore., and Rep. Frank Pallone, D-N.J., said in a statement in response to the CMS finding. “We will ensure taxpayers get their due.”

Mylan had no immediate comment, Bloomberg reported.

The CMS finding was the result of a letter from the Senate Finance Committee sent last month asking whether Mylan manipulated the Medicaid Drug Rebate Program by misclassifying EpiPen as a generic drug. The CMS found that is indeed what Mylan did.

“A review of our records indicates that, prior to 1997, EpiPen was reported as a single source, or brand drug, for the Medicaid Drug Rebate Program,” CMS found. “Since the fourth quarter of 1997, EpiPen has been reported as a noninnovator multiple source, or generic drug. EpiPen is approved under a New Drug Application by the Food and Drug Administration, has patent protection, and has no FDA-approved therapeutic equivalents.

“These facts indicate EpiPen does not meet the definition of a multiple source drug, but, in fact, meets the definition of a single source drug or brand drug.”

CMS said it had provided guidance to Mylan on multiple occasions to no avail.

Mylan paid a $124 million fine in 2009 for misclassifying its drugs and underpaying rebates.