Biotech and Pharma

Mylan faces federal antitrust investigation in EpiPen business

Mylan EpiPen
Drew Angerer | Getty Images

Federal antitrust regulators are eyeing big drugmaker Mylan's EpiPen business, the company said Monday.

Mylan, in a statement, said the Federal Trade Commission asked it "months ago" for information about its anti-allergy EpiPen "as part of a preliminary investigation."

The disclosure comes nearly five months after two United States senators asked the FTC to investigate whether Mylan violated antitrust laws to protect the auto-injector EpiPen from competition.

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Those lawmakers' interest in EpiPen in turn was sparked by consumer outrage over Mylan having raised the price of the device more than 500 percent in recent years, to more than $600 per two-pack.

"Mylan received an information request from the FTC months ago as part of a preliminary investigation," said Mylan spokeswoman Nina Devlin on Monday.

"Any suggestion that Mylan took any inappropriate or unlawful actions to prevent generic competition is without merit," Devlin said.

"We note that the epinephrine auto-injector market is and always has been competitive, with multiple products competing on the market since we acquired EpiPen Auto-Injector."

"Further, Teva has had patent licenses to launch their proposed generic alternative to EpiPen Auto-Injector since June 2015, pending FDA approval, years prior to patent expiry," Devlin said.

Mylan's stock was down about 1 percent in afternoon trading Monday.

New York Attorney General Eric Schneiderman last September opened his own antitrust investigation of Mylan. At the time, Schneiderman said "a preliminary review by his office revealed that the company "may have inserted potentially anticompetitive terms" into its sales contracts for Epipen "with numerous local school systems."

In October, Mylan agreed to pay a $465 million settlement with the U.S. Department of Justice to settle claims that the company shortchanged the Medicaid system by misclassigying EpiPen for the purposes of a drug rebate program.

Mylan did not admit any wrongdoing in the settlement. But before the deal was reached, a number of members of Congress had questioned whether Mylan was paying the correct rebate rate for EpiPen to the Medicaid Drug Rebate Program.

Mylan for years had classified EpiPen as a generic product for the purposes of that program. Generic drugs pay a rebate of 13 percent for sales made through Medicaid, which is the jointly run federal-state health coverage system for primarily poor people.

Brand-name drugs pay a rebate rate of at least 23.1 percent. But brand-name products whose prices rise faster than the rate of inflation can be subject to even higher rebate rates.

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