Maker of EpiPen Overcharged Federal Government Over $1 Billion Based on New Estimate

Google+ Pinterest LinkedIn Tumblr

A new estimate completed by the Department of Health and Human Services shows the makers of the EpiPen overcharged the government for the lifesaving epinephrine injectors by more than $1.27 billion over the course of 10 years. The company incorrectly classified the drug within the government rebate program allowing them to provide less in rebates for Medicaid patients.

As reported by ABC News, Mylan, the pharmaceutical company, had the EpiPen listed as a generic drug and not a brand-name product. The improper categorization allowed Mylan to provide less in rebates and left taxpayers responsible for a larger portion of the bill.

The news was shared with Sen. Chuck Grassley, the chairman of the Senate Judiciary Committee, by the inspector general of the Department of Health and Human Services. The Judiciary Committee has been investigating the pricing of the EpiPen since last year.

In a statement regarding the discovery, Grassley said, “It looks like Mylan overcharged the taxpayers for years with the knowledge EpiPen was misclassified, and the previous administration was willing to let the company off the hook.” He continued, “The fact that Mylan is unwilling to cooperate and provide documents voluntarily makes me wonder what there is to hide and whether a subpoena is the only way to get to the bottom of this.”

Mylan caught the attention of lawmakers after raising the price of a two-pack of injectors to $600 in 2016. In 2007, the same product cost less than $100.

During the controversy, it was questioned whether Mylan was providing proper rebates to Medicaid.

In October 2016, Mylan announced a settlement with the Department of Justice in the amount of $465 million. Under the terms of the agreement, the company would admit no wrongdoing. That settlement amount has now been called into question since the disparity appears to be significantly higher than originally anticipated.

Mylan has declined to comment on the new estimate. However, they did state the company was working with the federal government to finalize the settlement.

EpiPens are used to counteract anaphylaxis, a potentially fatal allergic reaction. For those with such allergies, having an EpiPen available is considered a requirement as the drug can save their lives in the event they are exposed to their allergen.