- Greg Friese via Flickr
The pharmaceutical company in hot water over the price of the EpiPen just answered a major question on everyone’s minds.
Why doesn’t it just cut the price?
The EpiPen, a device used in emergencies to treat severe allergic reactions, costs 500% more than it did when Mylan acquired it in 2007.
To fend off public outrage over the EpiPen’s cost, Mylan has done anything but cut the list price of the drug, which is $600 for a two pack.
It has raised its copay-coupon system to cover $300 of out-of-pocket costs for those with commercial insurance. The company also plans an “authorized generic” version of the EpiPen that would cost $300 for a two-pack, half the list price of the branded drug.
In a letter to Senator Chuck Grassley, who was among the first to ask Mylan for questions, the drugmaker answered the big question.
Basically, the company says offering a generic version will help people out a lot more than a price cut off the branded version would. And Mylan wants people to switch: the company expects the majority of prescriptions to be filled with the generic rather than the branded version. Which could get interesting – Mylan could stand to make more off the $300 generic than their original product, some industry experts think.
Here’s what the company had to say:
“The short answer is this: Mylan assessed available options under the existing pharmacy billing models to achieve the goal of delivering cost savings for patients with high out-of-pocket expenses and concluded that offering a generic version of EpiPen Auto-Injector would yield significantly greater and more sustainable cost savings for patients than a reduction in [wholesale acquisition cost] of the brand version would. In fact, we expect that, in the future, the vast majority (more than 85%) of epinephrine auto-injector prescriptions will be written for or filled with the less expensive generic version of EpiPen Auto-Injector. By ensuring the generic is priced well below the brand, we will be able to help ensure robust generic utilization and savings for patients and the healthcare system.”
The letter was posted to Grassley’s Website. Read all of Mylan’s responses.