Pharmaceutical company, Mylan (NASDAQ: MYL) CEO Heather Bresch grilled by the congressional committee for the increase of their anti-allergy device, EpiPens. Duncan said the lack of a free drug/device market is primarily the fault of the FDA, which has made it nearly impossible for a small company to get a drug or device to market.
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The House Oversight and Government Reform Committee released the testimony ahead of her Wednesday appearance before the panel.
Bresch is the daughter of U.S. Sen. She said that after distributors and pharmacy benefit managers took their fees, and after other costs were accounted for, the company made a profit of about $50 for each pen.
Bresch defended the price hikes, saying that after rebates, marketing costs and other expenses, Mylan earns about $100 for a pair of EpiPens.
Bresch, who grew up in Fairmont, West Virginia, portrayed herself as one who comes from humble roots.
Bresch said the company sold approximately four million two-packs in the last 12 months. She had 15 different positions as she worked herself up, she said.
The EpiPen price increases ignited a national controversy in August following complaints by families. Bresch says the company makes only $50 in profit on each EpiPen. “You raised the price, what did you think was going to happen?”
Cummings emphasized his disgust that pharmaceutical companies would continue to ratchet up drug prices for life-saving medication and said he hoped Bresch would apologize. “You chose to charge her $US600 ($816) instead of cutting off her arm”, DesJarlais said.
Responding to the lawmakers, Bresch laid out the changes Mylan has instituted in the past weeks to address the uproar.
Holding up an EpiPen, he said: “the actual juice that’s in here that you need costs about a dollar”. “But no one really deserves $18 million”, he said.
“We don’t want to go back to a time – not that long ago – when awareness of anaphylaxis was much lower and epinephrine auto injectors were only available in schools with a prescription for an individual child”, she says. But Chaffetz said he finds that “a little hard to believe”.
The committee’s top members have said they are sympathetic to the outrage of families and schools struggling to afford the device, which injects a dose of epinephrine to stop life-threatening allergic reactions. That brought in sales of almost $1.7 billion for Mylan, though the company says it receives about $1.1 billion after rebates and fees paid to insurers, distributors and other health care businesses.
Bresch is the daughter of a former West Virginia governor and current US senator, Joe Manchin. Her father is Sen.
The company has gone on the defensive, offering patients additional assistance with out-of-pocket costs and announcing that it would begin selling a generic version of the product at half of the cost.
“I’m concerned this is a rope-a-dope strategy”, Cummings told her. No such provision existed for generic drugs prior to the 2015 Bipartisan Budget Act.[4] As a result, misclassifying a brand drug as a generic insulated the manufacturer from paying Medicaid additional rebates when it increased the price of drugs.
“After Mylan takes our punches, they’ll fly back to their mansions in their private jets and laugh all the way to the bank”, Rep. Elijah Cummings (D-Md.) said. “While our constituents suffer, file for bankruptcy and watch their children get sicker or die”.
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Republican Rep. Scott DesJarlais of Tennessee, a physician, told Bresch that she was “trying to make us feel good” about the generic version and other programs, but that he doesn’t feel good about it. “And I’m not buying it”.
