West Virginia Says It Will Get $1.9 Million in EpiPen Settlement

West Virginia health authorities say the state will get more than $1.9 million from a settlement with drug company Mylan Inc. over its emergency allergy injector.

The Department of Health and Human Resources Medicaid Fraud Control Unit says it resolves allegations that Mylan made false Medicaid statements by classifying EpiPen as a generic instead of brand name product and lowering rebates.

According to West Virginia officials, all 50 states have entered into agreements with Mylan.

Department Inspector General Kathy Lawson says they worked with a team from the National Association of Medicaid Fraud Control Units to resolve the case.

The state unit investigates allegations of health care fraud against the Medicaid program and abuse, neglect or financial exploitation of patients in Medicaid-funded facilities and residents in board and care facilities.

AG Opposes $465M Mylan Settlement

West Virginia Attorney General Patrick Morrisey is urging federal and state officials to reject a reported $465 million settlement with drug maker Mylan over Medicaid reimbursements for the company’s the emergency allergy injection EpiPen.

In a letter to U.S. Attorney General Loretta Lynch, Morrisey calls the settlement “woefully deficient” and “a sweetheart deal” for the drug company.

The letter was copied to West Virginia Department of Health and Human Resources Secretary Karen Bowling.

Mylan’s settlement with the Justice Department follows news that EpiPen was incorrectly classified as a generic product under the Medicaid program.

However, the federal government says it’s a branded drug requiring a far higher company rebate.

Morrisey, who has been investigating Mylan, says it may actually owe Medicaid $700 million.

Mylan operates a manufacturing plant in Morgantown.

Federal Government: Mylan Has Been Overcharging for EpiPens

Even the federal government is apparently paying too much for EpiPens, along with angry patients and insurers.

The skyrocketing price of the life-saving allergy shot, which has triggered a storm of criticism, is only part of the problem. Now the federal government, responding to Congressional inquiries, says Medicaid has for years been paying too much for EpiPens because the emergency shot is classified incorrectly as a generic medicine.

The federal government says EpiPen is a branded drug, which means the drug’s maker, Mylan, should have been paying the government a far higher rebate under the government’s complex pricing rules. Mylan could face steep penalties.

Mylan, which has been blasted for hiking EpiPen’s price to $608 from $94 since 2007, denies wrongdoing

EpiPen Costing Too Much? Here's How You Get the Alternative

Barbara Hollinger is allergic to yellow jackets. A few years ago, she was paying  about $50 for several packs of EpiPens, the brand name for a device that delivers a lifesaving dose of epinephrine after an allergic reaction. Then a pack of two became $300, then $600 – so she did some research online and asked her doctor to write a prescription for a generic epinephrine autoinjector. A day later, the pharmacy called and said it was ready.

 

“And it was $616,” she said. “I said, ‘That can’t possibly be right. What’s in the package?’ and [the pharmacist] said, ‘an EpiPen,’ I said, ‘That’s not what my prescription is for.’”

“There is such a thing as a generic epinephrine autoinjector; however, there’s no generic to the actual EpiPen,” said Dr. Michelle Knight, associate professor of pharmacy at the University of Charleston Pharmacy School.

In order for a medication to qualify as a generic substitute, it has to be almost exactly like the brand name product, just without the brand. Mylan, the company that makes EpiPen, has said it will release a generic version of the EpiPen in “a few weeks,” although no date has been set.

“So the name of this product that there is a generic to is called Adrenaclick,” said Knight. “It’s another brand-name product, but the difference between that and an EpiPen is that it does have a generic that is available”.

Adrenaclick’s generic cannot be substituted for the EpiPen because the injection device is different, though the medication inside is exactly the same. So if you have a prescription for an EpiPen, you will have to buy an EpiPen. If you want the generic version, your prescription has to read like Hollinger’s – generic epinephrine autoinjector – and you have to hope that the pharmacist will fill the prescription as written and not offer the readily known EpiPen.

“Epinephrine is a medication that has really been around for decades, it’s just the EpiPen has become the most popular formulation of epinephrine,” said Knight. “The reason for that is a lack of competition. There were some other brand-name products on the market like Auvi-Q and Twin Jet, but they were recalled due to some dosing and device issues.”

Because EpiPen is the oldest and most well-established autoinjector on the market, Knight said doctors trust the device to do what it is supposed to, and have just started prescribing it by the brand name.  Some may not even know that a generic autoinjector exists.

Which is the issue Barbara Hollinger ran into at her pharmacy. Her pharmacist eventually found and ordered the generic. Hollinger returned to the pharmacy a few days later to pick it up.

“Instead of the $616 EpiPen, I had to pay $5 for my generic alternative,” she said.

It’s important to note that Hollinger has an insurance plan that covers almost the whole cost of the generic. Of the 17 pharmacy representatives I talked to, all but one said they either had the generic or could order it. Some pharmacists, however, had never heard of the generic until I asked them to check their system.

Cash prices for the generic varied widely from pharmacy to pharmacy. The highest I found was $561; the lowest was $382. However, there was some variation within companies as well – even the same company within the Charleston area. Online prescription coupons brought down the price further.

In an email, one company spokesman said that drug price differences between pharmacies are due to a variety of “local and corporate factors.” He did not respond to an email asking for clarity about what those factors are.

Appalachia Health News is a project of West Virginia Public Broadcasting, with support from the Benedum Foundation.

House Panel: Mylan CEO Disguised Profits in EpiPen Testimony

Leaders of the House Oversight Committee want EpiPen maker Mylan to explain why the company’s CEO failed to tell Congress that profit rates the company claimed for the life-saving EpiPen were calculated after taxes.

Mylan CEO Heather Bresch repeatedly told the panel last month that Mylan made just $50 in profit for EpiPens sold for more than $300 apiece. But the lawmakers said in a letter released Monday that the figures Bresch cited were calculated after factoring in the 37.5 percent U.S. tax rate. Before taxes, the EpiPen profit is actually $160 for a two-pack.

Committee Chairman Jason Chaffetz of Utah and Rep. Elijah Cummings of Maryland, the panel’s senior Democrat, said Bresch’s failure to disclose the tax assumptions raised questions about her truthfulness at the Sept. 21 hearing.

House Panel: Mylan CEO Disguised Profits in EpiPen Testimony

Leaders of the House Oversight Committee want EpiPen maker Mylan to explain why the company’s CEO failed to tell Congress that profit rates the company claimed for the life-saving EpiPen were calculated after taxes.

Mylan CEO Heather Bresch repeatedly told the panel last month that Mylan made just $50 in profit for EpiPens sold for more than $300 apiece. But the lawmakers said in a letter released Monday that the figures Bresch cited were calculated after factoring in the 37.5 percent U.S. tax rate. Before taxes, the EpiPen profit is actually $160 for a two-pack.

Committee Chairman Jason Chaffetz of Utah and Rep. Elijah Cummings of Maryland, the panel’s senior Democrat, said Bresch’s failure to disclose the tax assumptions raised questions about her truthfulness at the Sept. 21 hearing.

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