Dive Brief:
- EpiPen price hikes can be traced to poor federal regulations, the Food and Drug Administration and other red tape that limits competition, said a report from the National Center for Policy Analysis.
- It all comes down to the numbers, writes Devon Herrick a senior fellow at the nonprofit think tank. The going $300 price for a single epinephrine auto injector for people with severe asthma or allergies should really be priced at $20, he says, because the technology that made the device hasn’t changed much in nearly four decades.
- Americans waste "more than $1 billion annually" on expired or discarded EpiPens, worth about $80 million, Herrick adds.
Dive Insight:
When Mylan bought the rights to the 30-year-old life saving allergic reaction device EpiPen in 2007, a single device was sold to patients for about $57, and by August 2016, the price of each EpiPen was more than $304 – an increase of more than 400% in less than a decade, Herrick wrote.
The NCPA blames the pricing debacle on regulations and the Food and Drug Administration.
"Why is a 40-year-old product used to administer a generic drug so expensive?" Herrick asks. "Like many costly drugs, much of the blame is due to the way drugs are regulated in the United States by the FDA," he noted. The report also notes "aggressive price increases designed to take advantage of the regulatory environment" and "rent-seeking by (the drugmaker)."
Engineers have been tinkering with auto-injectors for half a century, and the technology isn’t complex. Based on production alone, the device should be sold for less than $20, the report said. "This is probably how much they would cost if the Food and Drug Administration approved an over-the-counter version or a behind the counter version" that pharmacists could dispense at a cheaper price than a doctor’s office," it added.
For months, Mylan has been fending accusations of price gouging after it was revealed that Mylan raised the price of a two-pack from $100 in 2009 to more than $600. After an outcry, Mylan issued a discount for uninsured and underinsured patients, and is planning a generic version to reduce the cost further. Earlier this month, Mylan reached a settlement with the U.S. Department of Justice for $465 million over whether it wrongly classified EpiPen with the Centers for Medicaid and Medicare Services (CMS) under the Medicaid Rebate statute.
There are now nine competing epinephrine auto-injectors selling in various countries throughout Europe, but only two have been approved for sale in the U.S. The FDA has twice rejected applications to market syringes prefilled with epinephrine, the report notes.
"Yet the FDA requires each new epinephrine auto-injector to be approved as if it were a new drug. Currently, firms wishing to compete in the epinephrine auto-injector market face an impossible task," accuses the NCPA.