Headlines this week could have some of you thinking, “Hooray! Drug companies are bringing down prices!”
Friday morning, Mylan, the maker of the EpiPen, launched sales of the “authorized generic” epinephrine auto-injector that will cost half the price of the name brand product. Earlier this week, pharmaceutical company Eli Lilly announced it has entered a deal with a website that will sell diabetes products at a 40 percent discount – directly to consumers without involving insurance companies.
And yet, 9Wants to Know is still cynical.
As investigative reporter Chris Vanderveen reported earlier this week, discount prices aren’t always what they seem. And Mylan’s new drug begs the question: why is the company selling the generic version of its product for $300 and the brand name version – which is exactly the same – for $600?
We asked Mylan – why the change, why now?
A spokesperson told us in an email: “By this summer approximately 15 percent of EpiPen purchasers were exposed to a cost of $600 or more. Understandably, they were outraged.”
Side Effects: 9Wants to Know investigation into prescription drugs
Most of those who were exposed to the full cost of the EpiPen either did not have insurance or had a high deductible plan. The company decided to address the concerns of the public, the media and Congress by releasing what the FDA classifies as an authorized generic.
Since 2003, the FDA approved the launch of 247 authorized generics. These are drugs that are identical to their brand name counterparts and are sold by the same company.
And while this lower price will undoubtedly help the hundreds of families who were facing $600 cost for EpiPen – our Side Effects series showed that EpiPen is just one of at least 100 drugs that have seen prices skyrocket 70% or more since 2012.
The system for pricing medicine in the U.S. is still in many ways, totally nonsensical.
Prices rise often unpredictably, sometimes overnight. Rebates and charge-backs between pharmaceutical companies, insurance companies and pharmacy benefit managers are often negotiated in secret – sometimes costing customers more than the cash price.
Ultimately, discounts for a handful of drugs doesn’t change the overall healthcare system.
In a press release published by Mylan, CEO Heather Bresch put it this way:
This broader systemic issue will not be solved in a meaningful and sustainable way by our industry's one-off, reactive responses. This is an issue that will impact virtually every family on a high deductible plan, regardless of what medicine they are taking. That is why it is critical that all industry participants and government leaders come together to seize the opportunity to make fundamental changes to the system to ensure access to medicine.
Perhaps Mylan’s CEO shares some of our cynicism. We couldn’t have said it better ourselves.