The U.S. Senate’s investigations panel is reportedly launching a “preliminary inquiry” into Mylan’s (NSDQ:MYL) pricing of the EpiPen epinephrine auto-injector.
Mylan came under fire in recent weeks for raising the price of EpiPens nearly 500%, from $100 in 2008 to more than $500 this year, despite stable manufacturing costs. In late August, Sens. Amy Klobuchar (D-Minn.) and Charles Grassley (R-Iowa) pressed Mylan to release a cost analysis of the device. Klobuchar also penned a letter to the U.S. Federal Trade Commission to investigate whether Mylan violated antitrust laws.
Yesterday, in a prepared statement, Sens. Rob Portman (R-Ohio), chairman of the investigations subcommittee, and Claire McCaskill (D-Miss.), its top Democrat, said, “Our review of this matter will be robust, thorough and bipartisan. Parents and school districts in Ohio, Missouri and across the country need affordable access to this life-saving drug, and we share their concern over Mylan’s sustained price increases.”
Mylan CEO Heather Bresch maintains that the cost increases are justified because of improvements Mylan made to the device. Bresch cites the “complexity and opaqueness of today’s branded pharmaceutical supply chain” as a motivation for companies to increase their prices.
Mylan said in late August that it would expand existing patient support programs and develop a generic that would cost around $300 for a pair of injectors. Rep. Elijah Cummings (D-Md.) called the move nothing more than a public relations stunt.
Mylan’s shares dropped 10% to $42.64 apiece when the criticism began in August. Since then, shares have slowly but steadily declined. The stock was trading at $40.12 per share in mid-morning activity today, down 0.47%.