House and Senate lawmakers are demanding that the Obama administration answer whether it failed to stop generic drug maker Mylan from paying a lower rebate to Medicaid for the allergy drug EpiPen.
Leaders from the House Energy and Commerce Committee and Senate Finance Committee wrote to the administration on Friday about EpiPen, whose manufacturer raised its price 400 percent since it acquired it in 2007. The letter centered on the Medicaid rebate program.
Under federal law, drug makers are required to give a rebate to Medicaid to help reduce the cost of their products. Brand name drug makers must give a rebate of about 23 percent of the average price and generic products 13 percent.
The EpiPen has been misclassified for years as a generic drug instead of as a brand name drug, enabling Mylan to pay a lower rebate.
Both committees were concerned that the Centers for Medicare and Medicaid Services “knew that EpiPen was misclassified for years and failed to take remedial action.”
Mylan recently entered into a $465 million settlement with the federal government in which the drug maker denied any wrongdoing.
Both committees want CMS to produce additional information and documents on the misclassification by Dec. 20. They want to know when CMS staff discovered the misclassification and what steps they took to rectify it.
CMS did not comment on the letter. However, it has said that it told Mylan about the misclassification multiple times but it wasn’t changed.
Mylan has faced congressional and public outrage over its price for EpiPen, which now runs $600 for a two-pack of the drug.
