Mylan CEO grilled by Oversight Committee

The House Oversight and Government Reform Committee held a hearing this week in an effort to get some answers from Heather Bresch, CEO of Mylan, regarding the company’s 500 percent EpiPen price hike.

Bresch testified along with Dr. Doug Throckmorton, deputy director of the FDA’s Center for Drug Evaluation and Research. The EpiPen auto-injector is a live-saving drug that counteracts anaphylaxis, a severe allergic reaction that can otherwise cause death in just minutes. The drug’s price has steadily increased since the company acquired the drug in 2007. At that time, it cost less than $100 for a 2-pack of EpiPens, now it’s up to $600.

During the hearing, the committee took turns admonishing the Mylan CEO for her actions. Yet, Bresch continued to assert the company did nothing wrong. “Price and access exist in a balance, and we believe we have struck that balance,” she said.

Bresch continually referenced the complex nature of pharmaceutical pricing and claimed that after fees and rebates the company only makes about $50 per EpiPen. She spoke of the company’s generous programs to provide free EpiPens to lower income families and public schools. She talked about the savings cards and discounts available and the fact that Mylan will be introducing a generic version of the EpiPen, which will cost half the price.

Legislators weren’t satisfied with Bresch’s responses. Representative Tim Walberg (R-MI) brought up Mylan’s lobbying efforts to get the EpiPen added to the list of preventative drug list under the Affordable Care Act, which requires that consumers have access to drugs with no out of pocket costs.

Rep. Walberg asked Bresch whether she thought Mylan’s “cost shifting” plan was a realistic solution to stem the rising price of drugs. “Won’t this in fact just shift the full cost of EpiPens to government payers such as Medicaid, Medicare, health insurers, employers, eventually leading to an overall increase in premiums and other co-pays of consumers?” he asked.

Bresch dodged his question in her response and reiterated her claims that Mylan is concerned about patient access, saying 85 percent of people pay less than $100 for a 2-pack of EpiPens.

Representative Tammy Duckworth (D-IL) brought up another controversial issue. According to a USA Today report, Bresch’s mother Gayle Manchin allegedly used her position as president of National Association of State Boards of Education to lead a campaign to mandate that schools stock epinephrine. As a result, 11 states now have such laws on the books. Since Mylan controls 94 percent of the market share for epinephrine injectors, this move put her daughter’s company in the perfect position to profit.

Mylan then launched programs to offer schools free or heavily discounted EpiPens, but only if the school signed an agreement not to buy products from competitors during a 12-month period. This questionable tactic has prompted Senator Amy Klobuchar to call for the FTC to investigate possible antitrust violations.

It’s important to remember that the EpiPen scandal isn’t an isolated incident. It’s just one that managed to garner enough public outrage to force the hand of our leaders. This hearing is a direct result of that pressure.

“This hearing is critical because yet another drug company, Mylan, has jacked up the price of a life-saving product for no discernible reason,” said Committee Ranking Member Elijah Cummings (D-MD). “They raised the prices, for the reason being, I believe, to get filthy rich at the expense of our constituents.”

Reports indicate the prices of 24 other Mylan drugs have had significant price increases of 20 to 100 percent and more under Bresch’s leadership. It’s worth mentioning that over the past nine years, her pay has also increased from $2,453,456 to $18,931,068 (671 percent).

Greed and questionable business tactics appear to be at play here. The hearing demonstrated a bipartisan effort to publicly condemn such practices. But it’s maddening that we’re still waiting for Congress to take meaningful action on drug pricing! It’s clear that we need to keep this issue in the limelight and continue to pressure Congress on this issue.