EpiPen Costs Skyrocket, Cause Outrage

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We are sure you have heard some talk about the EpiPen lately, but in case you missed it, earlier this year Mylan raised the cost of a pack to be more than $600 - a significant hike from what it originally cost when the company first purchased the rights to the drug/device in 2007 (at that time, EpiPens cost about $57 each). Since 2007, NBC News reports that the following actions have been taken:

• In 2008 and 2009, Mylan raised the price of EpiPens by 5%.
• At the end of 2009, Mylan tried a 19% price hike.
• From 2010-2013, there was a succession of 10% price hikes.
• From Q4 of 2013 to Q2 of 2016, Mylan raised EpiPen prices by 15% every other quarter.

It is no surprise that consumers are outraged over the EpiPen's new cost, as these are used for life threatening allergic reactions. With the new school year approaching many have a need to purchase an EpiPen and provide it to the school nurse, but the cost has made this increasingly difficult.

So why is the price of EpiPens so inflated?

Although it only costs about a few dollars to make (CNBC reports that only about $1 worth of epinephrine is used in these devices), there is currently NO EpiPen generic available in the United States. However, after the uproar began and Mylan faced more scrutiny from both consumers and Congress, they just announced that they will be launching a generic version of EpiPens for about half of the current price ($300). Teva Pharmaceuticals is also working on its own generic version of the EpiPen, and expects to receive approval sometime next year.

Mylan has also taken other actions to try and make EpiPens more affordable to consumers and members, such as by increasing the consumer/member out of pocket cost reduction from "up to" $100 to "up to" $300 - more details available here.

All that said, it is important for payors to understand that increased costs will be experienced, not only because of the increase in prescription costs for EpiPens, but also because of increased and conceivably unnecessary utilization or stockpiling of the brand drug. Additionally, offering a coupon for EpiPens will result in higher costs because eliminating the member copay results in brand loyalty, even though a lower cost generic will be available soon.

This is where we at PBIRx come in. We fight for our clients to get the most value for their health care dollars, and are well aware of the tactics used by Big Pharma to take advantage of consumers. If you have questions about the recent EpiPen news or would like to learn more about how we can help you during this time, please call (888) 797-2479 today.