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Mylan CEO infuriates lawmakers at hearing on EpiPen costs

Posted 3:28 a.m. Thursday
Updated 7:17 a.m. Thursday

— Mylan CEO Heather Bresch infuriated lawmakers as she tried — and mostly failed — to explain steep cost increases of her company's life-saving EpiPens.

Outraged Republican and Democratic lawmakers on Wednesday grilled Bresch about the emergency allergy shot's sky-high price and the profits for a company with sales in excess of $11 billion. The list price of EpiPens has grown to $608 for a two-pack, an increase of more than 500 percent since 2007.

In almost four hours of questioning, the soft-spoken CEO at times seemed unsure, or declined to answer directly, when asked questions about the company's finances and profits, angering lawmakers.

"You could make this thing go away by being honest and candid but I don't think you are," House Oversight and Government Reform Chairman Rep. Jason Chaffetz, R-Utah, told Bresch as he ended the hearing. Afterward, he told reporters he thought she created more problems with her vague testimony.

The frustration was bipartisan. Maryland Rep. Elijah Cummings, the top Democrat on the oversight panel, compared Bresch's answers to a game of "hide the ball."

Defending the company's business practices, Bresch said she wishes Mylan had "better anticipated the magnitude and acceleration" of the rising prices for some families.

"We never intended this," Bresch said, but maintained that her company doesn't make much profit from each emergency allergy shot and signaled the company has no plans to lower prices.

Families who rely on multiple EpiPens to respond when their children have allergic reactions, whether at home, school or sporting events, have lashed out at Mylan in a growing public outcry. Bresch blamed the furor partly on the complexity of drug pricing.

In response to one question, Bresch acknowledged she made $18 million in salary last year.

"Sounds like you're doing pretty well on this," said Rep. John Mica, R-Fla.

Chaffetz, said high executive pay at Mylan "doesn't add up for a lot of people" as the EpiPen price has increased. He said executives for the company made $300 million over five years while the list price for a pair of the allergy shots rose.

"Parents don't have a choice," Chaffetz said. "If your loved one needs this, it better darn well be in your backpack."

Bresch, who displayed an EpiPen, said the company makes only approximately $50 in profit on each shot. But Chaffetz said he finds that "a little hard to believe."

EpiPens are used in emergencies to stop anaphylaxis, the potentially fatal allergic reactions to insect bites and stings and foods like nuts and eggs. People usually keep multiple EpiPens handy at home, school or work, but the syringes, prefilled with the hormone epinephrine, expire after a year.

The company says it has distributed tens of thousands of free shots to schools and raised awareness of deadly allergies. That requires investment, Bresch said.

The Mylan executive has some familiarity with Capitol Hill — she is the daughter of Sen. Joe Manchin, D-W.Va. But lawmakers so far haven't given any deference to her, and several other committees have called for investigations into the price increase.

Bresch noted that Mylan has said it will begin selling its generic version for $300 for a pair. That will still bring Mylan tens of millions of dollars in revenue while helping retain market share against current and future brand-name and generic competition.

The company has also offered coupon cards and has doubled the limit for eligibility for its patient assistance program. But critics have said the coupons, discount cards and patient assistance programs aren't real solutions because many customers won't use them or won't qualify for them.

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.

"A mother would cut off her right arm to get that drug. You chose to charge her $600 instead of cutting off her arm," DesJarlais said. "Lower the price so they can afford it."

Last year, more than 3.6 million U.S. prescriptions for two-packs of EpiPens were filled, according to data firm IMS Health. That brought in sales of nearly $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.

In the Senate, leaders of the Homeland Security and Governmental Affairs' investigations subcommittee said earlier this month that they have begun an inquiry into the company's pricing and competition practices. The Aging Committee requested briefings on the issue, and Iowa Sen. Chuck Grassley, the chairman of the Judiciary Committee, has written several letters to Mylan demanding answers.

___

AP Health Writer Matthew Perrone and AP Medical Writer Linda A. Johnson contributed to this report.

13 Comments

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  • Mike Luddy Sep 22, 12:59 p.m.
    user avatar

    In true capitalism, other companys would be allowed to make epipens, and we'd have some competition. Remember when long distance calls were expensive?

  • Catherine Edwards Sep 22, 12:42 p.m.
    user avatar

    "Bresch, who displayed an EpiPen, said the company makes only approximately $50 in profit on each shot..."
    That's because the employees are sucking up the money.
    "He said executives for the company made $300 million over five years.."

  • Edward Anderson Sep 22, 12:41 p.m.
    user avatar

    Uncontrolled capitalism at it's worst. This is what happens when the government mandates that everyone have health insurance (ACA). The manufacturers *KNOW* that the insurance companies will pay whatever they charge and then when costs get passed down to the people who can least afford it through higher deductible/lower coverage plans, the lower/middle income classes get hit yet again.

  • Lee Rogers Sep 22, 12:33 p.m.
    user avatar

    "The government funded ALL the research and development of this product."
    I have no idea where you got that info - but that is just plain wrong.

  • Mike Luddy Sep 22, 12:14 p.m.
    user avatar

    How hard is this? The FDA should permit other companies to produce a generic. Yet another issue caused by excessive regulation.

  • Sean Creasy Sep 22, 11:40 a.m.
    user avatar

    View quoted thread


    The government funded ALL the research and development of this product. With that said Mylan was then allowed to take out the patent for it for free... Your tax dollars at work....

  • Lee Rogers Sep 22, 10:54 a.m.
    user avatar

    If you believe in Capitalism, they should be allowed to charge whatever they want and what the market will bear, right?

  • Jim Smith Sep 22, 10:47 a.m.
    user avatar

    View quoted thread


    That is ridiculous! How much money was donated by the government for this research and why should they pay it when they bought the completed drug from someone else?

  • Jim Smith Sep 22, 10:46 a.m.
    user avatar

    Congress is wasting taxpayer dollars with this dog and pony show. Its just like the mortgage mess-a whole lot of huff and puff yet no one held accountable. In this instance I honestly don't know if they have the right to be harassing this business. This is why there needs to be some fair laws regarding pharmaceuticals/healthcare in relation to public safety issues. The government should be able to buy out some patents at a fair price and produce for the public as needed. The public would be extremely surprised if they knew how low the pharmaceutical inventories of the most commonly used and needed drugs are in most hospitals in their community. Some are non-existent because they are not profitable to be produced, but we still need them around such as anti-venom for snake bites and certain antibiotics.

  • Russ Bullock Sep 22, 9:56 a.m.
    user avatar

    One company is allowed to buy up the rights to sell the only emergency allergy injector on the market, and we're surprised they jacked up the price? Give me a break. Actually, break up the medical monopoly we have in the U.S. and this would all go away. The ACA is a lame excuse for the type of reform we needed, but Congress was already on the monopoly's payroll, so.............

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