KHN Morning Briefing

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Settlement Finalized Between Mylan, Feds Over Epipen Overcharges To Medicaid

The $465 million settlement announced Thursday by the Department of Justice resolves claims that Mylan avoided paying rebates to the government by improperly classifying the EpiPen as a generic drug. Mylan and its auto-injector product have been at the center of the national debate over prescription drug costs.

Bloomberg: Mylan Wraps Up $465 Million U.S. Accord Over EpiPen Rebates 
Mylan NV and the U.S. Justice Department finalized a $465 million settlement to resolve claims that the drugmaker defrauded taxpayers by misclassifying its allergy-shot EpiPen product as a generic drug. The settlement, announced by the Justice Department Thursday, resolves claims that Mylan was able to improperly avoid paying rebates owed to the government by classifying EpiPen as generic even though the company marketed it as a brand-name medicine. The drugmaker disclosed an agreement last year but government officials wouldn’t confirm it until now. (McLaughlin and Hopkins, 8/17)

Associated Press: EpiPen Maker Finalizes Settlement For Government Overcharges
EpiPen maker Mylan has finalized a $465 million government agreement settling allegations it overbilled Medicaid for its emergency allergy injectors for a decade — charges brought after rival Sanofi filed a whistleblower lawsuit and tipped off the government. It’s the second settlement with the Department of Justice that Mylan has made since 2009 for allegedly overcharging the government for its medicines. (Johnson, 8/18)

USA Today: Mylan $465M EpiPen Settlement Finalized
The drugmaker raised EpiPen prices by roughly 400% between 2010 and 2016, according to federal investigators. EpiPen is a disposable, pre-filled injector that administers epinephrine to counteract severe allergic reactions. (McCoy, 8/17)

Stat: EpiPen Maker Mylan To Settle On Claims It Overcharged Taxpayers
Lawmakers slammed the federal agencies on Thursday for letting Mylan get off the hook too easily with the settlement. Sen. Richard Blumenthal (D-Conn.) called it “completely insufficient,” and Sen. Chuck Grassley (R-Iowa) cast is as “disappointing” in statements. Mylan, meanwhile, called the settlement, “the right course of action,” and said that the product has been reclassified under Medicaid as of April 1. (Swetlitz, 8/17)

Modern Healthcare: DOJ, Mylan Finalize $465 Million EpiPen Medicaid Settlement
Medicaid requires pharmaceutical companies to provide their products at a discount to the government. Most branded drugs are either 23% less than the average manufacturer price, or the difference between that average price and the lowest price they sell anywhere, adjusted by inflation. Medicaid receives a 13% rebate on generic drugs from the average price. HHS' Office of the Inspector General estimated the misclassification cost Medicaid $1.27 billion in lost rebates from 2006 to 2016. (Lee, 8/17)

Pittsburgh Post-Gazette: Mylan Finalizes Settlement Over Medicaid Payments For EpiPen
Medicaid requires pharmaceutical companies to provide their products at a discount to the government. Most branded drugs are either 23% less than the average manufacturer price, or the difference between that average price and the lowest price they sell anywhere, adjusted by inflation. Medicaid receives a 13% rebate on generic drugs from the average price. HHS' Office of the Inspector General estimated the misclassification cost Medicaid $1.27 billion in lost rebates from 2006 to 2016. (Sabatini, 8/17)

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