Mylan (MYL) Reduces EpiPen Cost After Clinton Comments
Shares of Mylan N.V. (MYL) were trading up +1.45 or +3.36 percent to $44.60 per share in Thursday’s premarket after news that the company reduced the cost of its EpiPen injection for severe allergic reactions. The price reduction was in large part the result of presidential nominee Hillary Clinton calling recent price hikes to the life saving treatment “outrageous”. Mylan N.V. stock closed at $43.15, down -2.47 or -5.41 percent in Wednesday’s regular trading session.
Founded in 1961 in West Virginia, Amsterdam, the Netherlands based Mylan N.V.
The EpiPen controversy began when Mylan acquired the EpiPen line of devices from Merck KGaA as part of a 2007 transaction in which Mylan bought Merck’s generics division.
In 2007, the price of two EpiPens was about $100 and remained unchanged until 2009. By July of 2013, the device was priced at $265. In May of 2016, the price was raised to $461 and one year later reached $609, which brought a barrage of criticism from two senators, the initiation of a Congressional investigation and an accusation of “price gouging”.
On Wednesday afternoon, presidential candidate Hillary Clinton in a tweet said, “EpiPens can be the difference between life and death. There’s no justification for these price hikes.” In a statement calling for Mylan to lower its price on the device, Mrs. Clinton said that recent price hikes of the EpiPen were “outrageous, and just the latest example of a company taking advantage of its consumers.”
She added that, “It’s wrong when drug companies put profits ahead of patients, raising prices without justifying the value behind them”. Clinton made the comments after a bipartisan group of lawmakers asked for an investigation into the price hikes. The request, by Democratic Senator Claire McCaskill and Republican Senator Susan Collins was for Mylan to provide a briefing for the Senate to explain the price increases.
Mylan responded this morning and said that it would reduce the patient cost of EpiPen through a savings card issued by the company that would cover up to $300 of an EpiPen two pack. According to Mylan, the card effectively reduces the out of pocket expense of the product by 50 percent to patients previously paying the full amount. In addition, Mylan said it was doubling the eligibility for its patient assistance program that will eliminate out of pocket costs for under insured and uninsured patients.
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CEO Heather Bresch on an earnings call earlier this month said that price hikes to EpiPen were in part due to Obamacare.
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