Mylan CEO Heather Bresch delivered a defiant performance before a group of hostile lawmakers upset over the company’s EpiPen’s price hike, as she called the current $600 price tag “fair.”
Bresch refused to apologize before the House Oversight and Government Reform Committee Wednesday for raising the price by more than 400 percent since the generic drug maker acquired the allergy treatment in 2007. She said in her opening statement that Mylan regrets not anticipating the magnitude of a “growing minority of patients who may have ended up paying the full [wholesale acquisition cost] price and more.”
However, Bresch stood by the company’s decision to charge $600.
“We believe it was a fair price and we just now lowered that price by half,” Bresch said in response to a question from Rep. Scott DesJarlais, R-Tenn., on whether Mylan was charging too much. She was referring to a new $300 generic version Mylan has offered.
Bresch was also defiant when responding to withering criticism from Rep. Tammy Duckworth, D-Ill., about contracts with schools. Duckworth pointed to contracts that Mylan made schools sign that said in exchange for buying discounted EpiPens the school couldn’t buy auto-injectors from a competitor.
“They did not have to buy our pens,” Bresch responded.
Duckworth then brought up a USA Today story that said Bresch’s mother, Gayle Manchin, the wife of Sen. Joe Manchin, D-W.Va., lobbied to get schools to acquire EpiPens while she was head of the National Association of State Boards of Education.
“Your own mother is out there lobbying to make sure they’re inside their schools,” Duckworth said, holding up a copy of the story.
Bresch pushed back, saying the article was “completely inaccurate.” Earlier in the hearing she called the story a “cheap shot.”
Bresch pointed to the company’s decision to offer a $300 generic version of the EpiPen instead of lowering the price. Bresch called the move to create a generic version of Mylan’s own product unprecedented and that the company’s sales will “absolutely go down dramatically.”
But lawmakers didn’t appear to buy the idea that the generic version would help alleviate the problem.
Committee Chairman Rep. Jason Chaffetz questioned how much Mylan will profit from the generic version. He pointed to a direct shipping option in which patients can buy the $300 generic direct from Mylan without having to go through wholesalers.
Chaffetz then pointed to Bresch’s testimony that Mylan receives $274 out of the $608 two-pack of epipens, with the rest going toward other costs and to wholesalers.
“So your revenue is actually going to go up under the direct product because you say you only get $275 and now you are going to get $300,” he said. “You’re actually raising the price.”
“The wholesale acquisition cost is what is going to $300,” Bresch said. “We will actually receive an estimated $200 but we believe it will be less than that.”
Chaffetz responded that Mylan will sell it direct to consumers, and then he asked how much that will cost the consumer.
“We hope that everybody will get it though the channels of all the different programs,” Bresch said, without elaborating.
“You’ve got to help clarify for this board because this does not make sense,” Chaffetz said.
Other lawmakers took aim at the cheaper generic.
“We are supposed to feel good because you take a drug that you are overcharging six times what it is worth and you are going to drop the price for $300?” said DesJarlais.
Bresch responded that she believed the price was fair and that Mylan lowered it by half through offering the generic.
DesJarlais then asked, if the price was fair why was it lowered?
“We wanted to make sure that we are addressing the higher out-of-pocket costs,” Bresch said. “The system wasn’t intended for people to pay the wholesale acquisition cost.”
“If it cost $20 then they could buy it,” DesJarlais retorted.
Some lawmakers were frustrated with Bresch’s inability to answer certain questions.
Rep. Elijah Cummings of Maryland, the top Democrat on the committee, asked how much Mylan spent on research and development in 2015 for EpiPens.
Bresch responded that since Mylan acquired the EpiPen in 2007 it has spent about $1 billion on research and development. She also mentioned efforts to get a new formulation of the drug approved that will last longer.
Bresch didn’t give the exact breakdown of research and development costs last year, which frustrated Cummings.
“I feel like you are not giving me the answers,” he said. “In fairness to us, you knew what this hearing was about. You knew what our concerns were.”
