Rio Hondo College Newspaper

El Paisano

Mylan slapped with class-action racketeering lawsuit

Crystian Mendoza, Sports Editor

Mylan, a global pharmaceutical company, was hit with a class-action racketeering lawsuit April 3. The company is charged with intentionally setting up an illegal scheme in which they’ve drastically increased the price of their EpiPen over the past ten years.

Roughly a decade ago, consumers were paying a fraction of the price at approximately $90 for an EpiPen, which is an anti-allergy device used to treat a potentially fatal allergic reaction that is known as anaphylaxis. Last summer, a two-pack of EpiPens was selling for upwards of $600.

The lawsuit claims that Mylan has raised the price of their EpiPen seventeen times in the past ten years, meanwhile competitors attempted to put out an alternative device that could compete with the skyrocketing prices during that period.

Unfortunately, those other companies were not able to gain dominance in the EpiPen market due to the rebates Mylan was able to offer pharmacy benefit managers thus forcing millions of people who heavily rely on these devices to prevent serious life-threatening allergic reactions to subdue themselves to the price markups.

“Despite the fiction that Mylan has tried to sell the public, and sell Congress, the numbers don’t lie — Mylan has been the motivating force behind the jaw dropping 574 percent EpiPen price hike,” said Steve Berman, managing partner of Hagens Berman who is representing the three plaintiffs in the lawsuit.

The hiking price of the EpiPen device bears little correlation to the cost of production, and it is simply the pharmaceutical industry taking advantage of customers who need an EpiPen to treat their potentially fatal allergic reactions, even if the price continues to increase for them there is not many other alternatives, if any, as reported by CNN.

Although most EpiPen customers are believed to have some form of insurance that either covers all or a majority of the cost of the device, there is still a small fraction of consumers out there who have to pay the full list price because they either have no insurance or they simply want to buy multiple packs of EpiPens but their insurance may only cover a specific amount.

Both Mylan and pharmacy benefit managers had a mutual interest in hiking up the price of EpiPens in order to increase their profits which led to the artificial inflation of such, as the increase in the price of EpiPen over the past decade has absolutely nothing to do with the cost of production it is simply a supply and demand scheme, CNN reported.

“When you scheme to drive up the list price beyond any relationship to cost, that’s illegal,” Berman said.

Even though Mylan was the only defendant named in the suit, it also claims that CVS Caremark, Express Scripts, and Optus Rx all participated in this scheme with a common goal of inflating the list price of EpiPen, making them just as guilty.

The Pharmaceutical Care Management Association said in a statement to CNBC that “Mylan has spent the past year blaming Washington, the prescription drug supply chain, and competitors for its unusual pricing practices. It’s time for them to look in the mirror and take responsibility for their own actions.”

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Rio Hondo College Newspaper
Mylan slapped with class-action racketeering lawsuit