US taxpayers may have overpaid US$1.27bn (£985,000) for EpiPen between 2006 and 2016 because the manufacturer, Mylan, had misclassified the drug under the Medicaid Drug Rebate Program (MDRP), according to a US senator.
This is far more than the $465m (£363m) the company reported it had agreed to pay in settlement negotiations with the Department of Justice, and was revealed in a letter from the Department of Health and Human Services Office of Inspector General to senator Chuck Grassley, chairman of the US Senate’s Judiciary Committee.
EpiPen was classified as a non-innovator multiple source (generic) drug rather than an innovator (branded) product under the MDRP.
Grassley has pressed Mylan and the Centers for Medicare & Medicaid Services (CMS) for months for answers on why EpiPen was misclassified, resulting in overcharges to taxpayers. Recently, CMS has provided records to the Judiciary Committee that show CMS told Mylan on several occasions that the EpiPen was misclassified, yet Mylan failed to correct the classification.
Grassley says: “CMS recently provided records to the committee that show Mylan was made aware of the misclassification years ago but did nothing. It looks like Mylan overcharged the taxpayers for years with the knowledge EpiPen was misclassified, and the previous [Obama] administration was willing to let the company off the hook. The fact that Mylan is unwilling to cooperate and provide documents voluntarily makes me wonder what there is to hide and whether a subpoena is the only way to get to the bottom of this.”
He added: “High prescription drug prices are a major concern across the country. I’m working to advance legislation that would help, including bills to bring lower-cost generic drugs to the market. As part of bringing down drug costs, we have to make sure companies that take part in federal healthcare programs are not gaming the system.”
Mylan was approached for comment.