I pride myself on being healthy, and I rarely have to visit the doctor outside of my yearly check-ups. And fortunately enough, I don’t have to take any medications. But as I get older, I have a feeling that won’t last forever, and I’m sure one day I’ll need to take some type of medication.
According to Mayo Clinic’s research, about 70% of Americans take at least one prescription medication, and 50% of Americans take at least two.
Some people need medicine to maintain their health — it’s just a fact of life — and pharmaceutical companies tend to take advantage of this vulnerability. A person’s health care should be affordable and, more importantly, shouldn’t be exploited.
Can’t Ignore These Prices
Increasing (and outrageous) drug prices set by pharmaceutical companies have been garnering recent attention and concern. Yes, it’s always been an issue, but never an issue that’s received a significant amount of attention. However, that changed last week when the nation’s full attention was on Mylan N.V. (NASDAQ: MYL).
Mylan has been receiving a lot of scrutiny over the extremely high price of its EpiPen, a device used in emergencies to treat anaphylaxis, a severe allergic reaction that includes symptoms like a skin rash, having a hard time breathing, or even going into shock.
The EpiPen is prefilled with the correct dose of epinephrine, which is injected and then delivered to the immune system to reverse the symptoms of an allergic reaction.
Mylan acquired the EpiPen device in 2007, when the list price was at $93.88. Since then, it’s increased 500% and is now priced at $608.61 — a very steep increase in just eight years.
The company started to receive a lot of attention when members of Congress demanded an explanation from Mylan about the high list price for the EpiPen. The scrutiny escalated even further when Democratic presidential nominee Hillary Clinton took notice and publically called the increase “outrageous,” saying that Mylan put “profits ahead of patients.”
Clinton’s tweet brought the attention to the big (but sometimes ignored) issue of how pharmaceutical companies tend to raise drug prices, making it nearly impossible for a person to obtain their medication — in this case, making it really difficult for someone to access a drug that could save their life.
Reversing the Damage
Mylan was feeling such political and public pressure last week that Mylan’s CEO, Heather Bresch, made a statement on Thursday. She was trying to offer an explanation about the price, while also putting the blame on the U.S. health care system.
Bresch said:
We recognize the significant burden on patients from continued, rising insurance premiums and being forced increasingly to pay the full list price for medicines at the pharmacy counter. Patients deserve increased price transparency and affordable care, particularly as the system shifts significant costs to them. However, price is only one part of the problem that we are addressing with today’s actions. All involved must also take steps to help meaningfully address the U.S. healthcare crisis, and we are committed to do our part to drive change in collaboration with policymakers, payers, patients and healthcare professionals.
In the same statement, Bresch explained how the company would be extending its programs that assist patients who can’t afford the high list price. Before all of this attention, they offered $100 off of the list price; now they’ll be offering these patients $300 off of the list price — giving them a 50% discount.
Mylan felt the pressure, and its stock has been feeling the pressure, too. The stock fell 12% since the beginning of last week. The chart below shows Mylan’s stock for the past 10 days:
On August 29th, Mylan went even further in hopes of reversing the scrutiny by announcing it’ll be launching a generic version of its EpiPen — a second attempt to get back in good graces with the public and consumers. The generic version will cost a patient $300.
Even with a generic version of the $600 EpiPen being introduced “in several weeks,” there are still a lot of questions to be answered.
Robert Weissman, president of Public Citizen, had this to say:
The weirdness of a generic drug company offering a generic version of its own branded but off-patent product is a signal that something is wrong.
Mylan doesn’t want to fully admit to price gouging, and instead of actually reducing the drug itself, the company has decided to add another product to sell at half the price while still having the $600 EpiPen available.
This move really isn’t the solution to the problem at hand, and it is why senators Richard Blumenthal and Amy Klobuchar are calling for an investigation into possible antitrust lawbreaking.
If anything, all of this has brought to light some really important issues — whether it be the flaws of our health care system or big pharmaceutical companies, we shouldn’t be complacent when it comes to our health and health care.
Until next time,
Monica Savaglia
Wealth Daily
