Posted 17 August 2017
By Zachary Brennan
Drugmaker Mylan announced on Thursday that it will pay $465 million to settle claims relating to the classification of EpiPen auto-injectors and EpiPen Jr. auto-injectors because of allegations of a misclassification of the product in the Medicaid Drug Rebate Program.
The government contended that Mylan improperly avoided paying Medicaid programs higher rebates for branded drugs by misclassifying EpiPen as a generic drug, even though EpiPen had no FDA-approved therapeutic equivalents and even though Mylan marketed and priced EpiPen as a brand name drug. Mylan raised the price of EpiPen by approximately 400% between 2010 and 2016.
Last August, Mylan announced it would offer authorized generic versions of its EpiPen at half the price of the brand name product after Senate Judiciary Committee members called for an investigation into the price increase.
Mylan, however, contended that the EpiPen has been classified with CMS as a non-innovator drug since before Mylan acquired the product in 2007, based on longstanding written guidance from the federal government.
Last December, the HHS Inspector General said it would investigate the Medicaid rebate program.
Sanofi, meanwhile, which has its own competing epinephrine auto-injector, was the company that raised the issue with the US Attorney’s Office in 2014, DOJ said.
In 2016, Sanofi filed a complaint against Mylan under the qui tam provisions of the False Claims Act, which permits private parties to sue on behalf of the government and to receive a share of any recovery. Sanofi will receive $38.7 million as its share, plus a share of the states’ recovery.
Mylan said it will reclassify EpiPen Auto-Injector for purposes of the Medicaid Drug Rebate Program and pay the rebate applicable to innovator products effective as of 1 April 2017.