Leading Democrats want to know if drug maker Mylan avoided for decades paying a higher Medicaid rebate for the EpiPen, whose $600 price tag has infuriated lawmakers.
Rep. Frank Pallone, D-N.J., and Sen. Ron Wyden, D-Ore., wrote to Health and Human Services Secretary Sylvia Burwell Friday asking about the status of the rebate for Mylan’s EpiPen. The letter is the latest inquiry from Congress into a startling 400 percent price hike for the life-saving allergy treatment.
Pharmaceutical companies are supposed to offer a rebate to make their drugs more affordable for Medicaid. Brand name drugs are required to pay a basic rebate of 23 percent of the average price or the average price minus the lowest price available to any wholesaler or retailer.
Generic drugs, which are copycat versions of a brand name product but significantly cheaper, pay Medicaid 13 percent of the average manufacturer’s price.
The EpiPen is a unique case in that it isn’t a brand name drug, as epinephrine auto injectors have been on the market for decades.
However, the Food and Drug Administration considers EpiPen a brand name drug, but under the rebate program Mylan classifies it as a generic drug to pay the lower 13 percent rebate amount, the letter said.
“Over the past two decades, it appears that Medicaid may have been grossly overpaying for EpiPen and its related products due to Mylan’s misclassification,” the letter said.
The lawmakers ask HHS a series of questions about the rebate program, such as communications surrounding the EpiPen’s rebate obligations and how much money state and federal governments lost from rebate revenue as a result of Mylan’s classification.
Other inquiries from Congress ask Mylan how the company got to the $600 price tag for a two-pack of the auto-injector, and ask the federal government about the impact of the price hike on federal programs such as Medicare.
Mylan has made a series of moves to quell public and congressional outrage including offering a cheaper “generic” version of EpiPen that is $300. The company also offered a $300 discount off the $600 price tag.
But the moves have done little to stop the outrage, as lawmakers point out that a discount to $300 is still too high for the life-saving drug.
