Mylan
hit with new class action lawsuit over EpiPen pricing
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[April 04, 2017] By
Brendan Pierson
(Reuters) - Mylan NV has been hit
with a new proposed class action lawsuit over the price of its EpiPen
allergy treatment, which shot up to more than $600 for a two-pack of the
device from less than $100 in 2007.
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The lawsuit was filed on Monday in Tacoma, Washington, federal court
by three EpiPen purchasers. It claims Mylan engaged in a scheme with
pharmacy benefit managers, or PBMs - companies that act as
intermediaries between pharmacies, insurers and drug companies - to
dominate the market and overcharge consumers.
Although other lawsuits have been filed over EpiPen pricing,
Monday's is the first to focus on the role of PBMs and to bring
claims under the Racketeer Influenced and Corrupt Organizations Act,
a federal law historically used against organized crime.
Mylan spokeswoman Nina Devlin declined to comment.
The EpiPen, acquired by Mylan in 2007, is a hand-held device that
treats life-threatening allergic reactions by automatically
injecting a dose of epinephrine. The company now sells a $300
generic version.
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The plaintiffs in Monday's lawsuit say Mylan paid large rebates to
PBMs so they would favor EpiPen over competitors. In helping Mylan
control 95 percent of the epinephrine auto-injector market, the
rebates artificially inflated EpiPen's sticker price, resulting in
higher costs for many patients, the suit said.
The lawsuit says the three largest U.S. pharmacy benefits managers -
CVS Caremark, part of CVS Health; Express Scripts Holding Co and
OptumRX, part of UnitedHealth Group Inc - aided Mylan's alleged
scheme. They were not named as defendants.
The plaintiffs are seeking damages to represent a nationwide class
of EpiPen purchasers.
Mylan has grappled with a growing backlash from U.S. consumers over
the price of EpiPen in the last year. Other class action lawsuits
have been filed against Mylan over the pricing of EpiPen, including
two currently consolidated in Kansas federal court. However, they
have not focused on the role of PBMs.
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The company is also under investigation by the Federal Trade
Commission and said last September that it had agreed to a $465
million settlement with the U.S. Justice Department over how the
drug was classified for government buyers. The Justice Department
has not confirmed the settlement.
Mylan Chief Executive Officer Heather Bresch has said that the
company makes only about $100 per EpiPen pack, and that most
consumers pay less than $50 for a two-pack.
The plaintiffs in Monday's lawsuit said Bresch falsely tried to
paint Mylan as a "victim" of a flawed healthcare system and avoid
its own responsibility in setting rebates.
The case is Rainey et al v. Mylan Specialty LP, U.S. District Court,
Western District of Washington, No. 17-cv-05244.
(Reporting by Brendan Pierson in New York; Editing by Dan Grebler)
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