Mylan NV said it will pay $465 million to settle questions of whether it underpaid U.S. government healthcare programs by misclassifying its EpiPen emergency allergy treatment, which has come under intense scrutiny after a series of drastic price increases.
Mylan has been lambasted by consumers and lawmakers for raising prices on the lifesaving EpiPen sixfold to over $600 for a package of two in less than a decade, making the devices unaffordable for a growing number of families. Lawmakers were trying to determine whether Mylan made more money on EpiPen than warranted from state Medicaid programs by having it classified as a generic product, resulting in much smaller rebates to the government health plans.
The Centers for Medicare and Medicaid Services, in response to a request from U.S. Senator Amy Klobuchar of Minnesota, said this week that the Medicaid plan for the poor spent $797 million on EpiPen between 2011 and 2015, including rebates provided by Mylan, or $960 million before rebates.
Senator Richard Blumenthal of Connecticut blasted the settlement as too small and said Congress should investigate whether Mylan violated the law. Mylan said in a regulatory filing on Friday that EpiPen will be classified as a branded drug as of April 1, 2017.
Bresch told lawmakers this week that Mylan plans to launch a $300 generic version of EpiPen as soon as possible this year. Mylan also lowered its 2016 earnings outlook, but the drugmaker affirmed its 2018 forecast and its shares rose 11 percent to $39.90 after hours.