Mylan Agrees To Pay $465 Million EpiPen Settlement

Mylan N.V. recently “announced that its subsidiary, Mylan Inc., has agreed to the terms of a $465 million settlement with the U.S. Department of Justice and other government agencies that will resolve questions that have been raised about the classification of EpiPen® Auto-Injector and EpiPen Jr.®Auto-Injector (collectively, “EpiPen AutoInjector”) for purposes of the Medicaid Drug Rebate Program.  The terms of the settlement do not provide for any finding of wrongdoing on the part of Mylan Inc. or any of its affiliated entities or personnel.”  In a 10/5/16 letter to Senator Ron Wyden, Senate Finance Committee Chair, the U. S. Centers for Medicare & Medicaid Services (CMS) questioned the classification of EpiPen under the Medicaid Drug Rebate Program.  EpiPen is approved by the U.S. Food and Drug Administration (FDA) under a New Drug Application, has patent protection, and has no FDA-approved therapeutic equivalents – it is a single source or brand drug, not a multiple source or generic drug.  Before 1997, EpiPen was reported as a brand drug, but since 1997, EpiPen has been reported as a generic drug.  CMS noted it “has, on multiple occasions, provided guidance to the industry and Mylan on the proper classification of drugs and has expressly told Mylan that the product is incorrectly classified.  This incorrect classification has financial consequences for the amount that federal and state governments spend because it reduces the amount of quarterly rebates Mylan owes for EpiPen. … Under the Medicaid statute, regulation, guidance, and the rebate agreement that participating manufacturers sign, it is the manufacturer’s responsibility to report accurate product and pricing data to the Medicaid Drug Rebate Program and pay proper rebate amounts. … Manufacturers that fail to accurately report product and pricing data to the rebate program and pay insufficient rebates may be subject to liability under the False Claims Act, a penalty of up to $100,000 per item of false information under the Rebate Agreement, or other government actions or claims.”