There has been much outrage and grinding of teeth lately about the rise in the price of Mylan, Inc.’s “EpiPen”.
Like every other “outrage of the week”, it pays to dig around and get the full story before joining the multitudes of those with their online pitchforks out, ranting away on Facebook and Twitter.
First, let’s get it out of the way that the CEO, Heather Bresch, is the daughter of US Senator, Joe Manchin (Democrat) of West Virginia. Therefore, I have to say that some Schadenfreude is in order witnessing Hillary Clinton and Bernie Sanders go off on her and her company with epic rants on Twitter.
It is interesting how the very same people who are outraged that there “are few female CEO’s” are now seriously pissed off at a woman who started at Mylan, Inc., as a data entry clerk and worked her way up to CEO. And Ms. Bresch has been quite the CEO. According to a 2015 article in Fortune, “Since becoming CEO in 2012, she’s overseen a major revenue increase; Mylan projects sales of up to $10.1 billion this year, up from $6.1 billion in 2011. Today she remains the only woman ever to run a Fortune 500 pharma company.”
Both Hillary and Sanders have excoriated Ms. Bresch’s 2015 compensation of $18.5 million dollars, proclaiming it “greedy.” To put this into perspective, Matt Damon was paid $26 million for “The Bourne Ultimatum”. ONE MOVIE. But he’s a “progressive” liberal, so I guess it’s OK.
Hillary and Bernie are in no position to determine what the price of any drug (or any other product for that matter) should be. I find it disgusting that they should weigh in on this when, as Kevin Williamson so brilliantly outlined in his piece in The National Review: “These people are parasites. They make: nothing. They create: nothing. They produce: nothing. But they feel perfectly justified — they positively glow with moral frisson — standing between the people who create and build and the people who benefit from those creations.”
It should be noted that the “high prices” of EpiPen that are being scrutinized are retail prices. Pharmaceutical companies raise drug prices all the time and you never hear about it. Why? Because most folks pay either nothing or small co-pays and are not aware of what the retail prices are for ANY of the medication they take. Don’t believe me? Next time you’re at your pharmacist picking up your medication, ask your pharmacist what the retail price is for your prescription drug. Then pick yourself off the floor.
EpiPen is not even a “drug”. It is a medical device (auto-injector) that injects a carefully measured amount of a drug called Epinephrine into a patient. Epinephrine has been around for decades and it available as a generic. Before auto-injectors (and still today), you can simply carry around a vial of Epinephrine and syringes around. Cost? About $6 to $10 a dose. The EpiPen is a device borne out of convenience.
As a medical device, EpiPen is subject to the medical device tax passed into law as part of ObamaCare. You can bet that part of the price increase was this cost being passed onto consumers. Also, the vast majority of ObamaCare plans do not cover EpiPen, so ObamaCare participants were specifically hard hit by the price increases because of the steep rise in deductibles in recent years. No mention of this in the media, though. Folks with “Cadillac” health plans acquire EpiPen at either no cost at all or only a small co-pay thanks to being exempt from the ravages of ObamaCare and its cost increases.
Being that Mylan Inc.’s proprietary element is the injector, Patent law protects them to a degree, but more so, the FDA seems to be the party at fault for lack of competition, which would drop prices dramatically. The FDA has been involved with thwarting the progress of multiple competitors of EpiPen. That has worked out very well for Mylan, Inc. and it is not unusual or beyond the pale for a company to increase prices on a product that sells well and has little or no competition.
What we have in the EpiPen debate is the perfect confluence of advantageous capitalism, government inefficiencies, and cronyism. No wonder the whole thing is a tangled mess.
Is Mylan, Inc. guilty of being “greedy”? Perhaps. It is a complicated question. I don’t think that the millions of shareholders who own the stock think so, including everyday folks with 401K’s. In fact, I bet they’re a bit peeved that under pressure from the politicians, press and the media, the stock nosedived.
Is the government greedy when it raises taxes?
And now for some good news: for those of you who use EpiPen, there is an alternative. It is known as Adrenaclick and is available in generic form at Wal-Mart for $141, according to GoodRX. Also, undoubtedly due to pressure by the nagging naysayers, Mylan, Inc. has introduced a generous savings card and offers the device for free to those with low incomes.
Free. Now even Bernie Sanders can rejoice.