Sen. Joe Manchin III (D-WV) is trying to dodge the firestorm of controversy ignited by his daughter, Mylan CEO Heather Bresch, after she jacked the price of life-saving EpiPens by more than 500 percent since 2009.
Days after the scandal outraged the public, Manchin finally broke his silence. He issued a brief statement, claiming to “share … concerns about the skyrocketing prices of prescription drugs.” But he avoided mentioning Bresch when he said, “I heard Mylan’s initial response, and I am sure Mylan will have a more comprehensive and formal response.”
It was a statement that said nothing. Manchin could have spoke of using his influence to land Bresch a job at Mylan more than 20 years ago. He might have pointed out Mylan was the top contributor when he served as governor of West Virginia, and is the number two contributor to his Senate campaigns, having poured $130,000 into his coffers starting the year the EpiPen price hikes began.
But that would only raise more questions. Manchin would have to explain why he helped kill a bill in 2012 that would authorize the import of FDA-approved drugs from Canada, where an EpiPen costs about $100 and “there are mechanisms in place” to ensure there are no arbitrary price jumps like in the United States. (Americans can buy EpiPens from Canada online for a third the cost.)
Therein lies the real scandal: It’s not so much about an unaccountable corporation as it is about a well-connected company manipulating the governmental process to create artificial demand for EpiPens and then jacking the price of a product millions carry around for emergencies.
The Raw Story can reveal Mylan has spent years and tens of millions of dollars seeding an astroturf movement for EpiPens “everywhere,” as Bresch states. It hires lobbyists, funds studies, organizes a grassroots army of advocates, throws around money to attract health professionals and organizations, including medical doctors, to push for the availability of EpiPens in public venues. Under Bresch, Mylan organized a campaign to pass laws requiring or rewarding public schools to stockpile EpiPens. This astroturf movement now has its sights on legislation mandating that all air carriers carry EpiPens and enabling “restaurants, museums, zoos, sports leagues, camps and other venues” to stockpile the device.
Mylan claims “improvements have driven up the cost of the devices” to $608.61 for a device that reportedly costs several dollars to make, including the epinephrine. But the improvements turn out to be its lavish marketing campaign as it has not made any real change to the device itself.
The irony is Mylan is price-gouging to put EpiPens everywhere, which means many people can no longer afford them in the first place.
On top of that, Mylan’s EpiPen everywhere movement is shady. While anaphylaxis is deadly serious, Mylan grossly overestimates such deaths per year at 1,500 annually. The American Academy of Asthma, Allergy, and Immunology says there’s been at most 225 deaths in a year, or less than one death per million people. Having EpiPens everywhere would not eliminate anaphylaxis deaths either. One study showed 84 percent of patients misuse auto-injectors. The authors concluded most patients “would not have benefitted from self-administration of the potentially life-saving treatment if the need arose.”
The story begins in 2007 when Mylan acquires Merck’s generic drug business, including the EpiPen. Mylan considered ditching the drug because it only brought in $200 million a year, but Bresch “hit on the idea of using old-fashioned marketing in part to boost sales among concerned parents of children with allergies.” Usage has soared 67 percent in the last seven years with some 3.6 million prescriptions inked last year, but Mylan is salivating at a market it estimates at 28 million users. So important is EpiPen to Mylan, it generated 40% of its operating profit and was the only product singled out in a Mylan report as a “growth driver.”
This was no ordinary marketing scheme as Bresch’s tenure at Mylan included “director of government relations, a key role at a company in a heavily regulated industry.” Her strategy was to get EpiPens stocked in public places. As EpiPen’s price ascended to stratospheric heights, Mylan’s political lobbying budget tripled and topped $1 million for the last eight years. The TV ad budget soared to $35.2 million in 2014, a more than 600 percent increase in barely three years. To expand the market for EpiPens, Mylan “hired consultants who had worked with Medtronic to get defibrillators stocked in public places,” according to Bloomberg Businessweek.
In 2012, however, the FDA smacked down a TV ad for Mylan’s EpiPen as “false and misleading because it overstates the efficacy of the drug product” and the dodgy ad could lead to serious consequences, “including death.”
After shelling out $4 million in lobbying, Mylan hit the jackpot in 2013 when President Obama signed the School Access to Emergency Epinephrine Act. The law prioritizes specialized federal grants for schools that stockpile EpiPens. In three years since, Mylan increased the price of two EpiPens by more than $300. The “key lobbyist” on the bill was the D.C.-based Food Allergy Research and Education, whose chief corporate sponsor happens to be Mylan. Mylan and FARE are now leading the charge for a bill to require all air carriers to carry at least two packs of epinephrine auto-injectors and to replace them regularly.
That was the warm-up as Mylan needed to get the auto-injectors into schools. It crows about having “collaborated with government officials, leading advocacy organizations, parents, caregivers and healthcare professionals to successfully champion legislation and policies—now enacted in 47 states—that allow or require schools to stock epinephrine auto-injectors.” It lists 14 health and patient-advocacy organizations as allies in its quest, as Bresch told CNBC this week, that “EpiPens need to be everywhere.”
Mylan Specialty L.P., is the sole corporate sponsor mentioned on the website of the Allergy and Asthma Network, which offers “free awareness and training programs [on] how to use an epinephrine auto-injector.” The AAN gushes about “Stock epinephrine … rapidly moving beyond the school walls and out to public venues—from theme parks, restaurants and sports arenas to daycare centers and more,” and it closely tracks “entity laws” that legalize stocking EpiPens and which have passed in 27 states. The AAN in turn helped found the Mylan-sponsored Anaphylaxis Community Experts, which is comprised of “more than 300 teams of volunteer allergists, school nurses, healthcare providers, and community members” who provide training, engage in advocacy, and “directly impacted 9 states’ stock epinephrine laws” in 2014.
The American Latex Allergy Association also promotes Mylan-funded programs. In January it urged Californians to contact a Mylan lobbyist to push for a state law to vastly widen the availability of EpiPens in public venues. That bill passed August 22, 2016, just as the EpiPen pricing-gouging scandal rocked the nation. Mylan was listed as the only sponsor on the California bill, and it backs at least three of the six supporting organizations mentioned on the bill.
Then there is the American Academy of Pediatrics, which allowed a Mylan-funded study to be presented at its 2015 annual conference, advocating for the expansion of its branded EpiPen4Schools® Program. The AAP simultaneously cited the study to call for “the need for greater access to epinephrine auto-injectors in schools and other public places.” The lead author of the study is a Mylan consultant who is quoted in medical news outlets calling for an expansion of the EpiPen program.
Mylan leaves no stone unturned. It sponsored the “Epinephrine Policies and Protocols” program creating the standards under which anaphylaxis is diagnosed and EpiPens administered. Then it funded the National Association of School Nurses for an EpiPen training program. It completed the circle with states codifying policy for schools on how to use EpiPens based on information from Mylan-funded pediatricians and nurses and how to get the product from Mylan.
It’s also venturing into the private sector. In 2014 Mylan struck a deal with Disney to stock EpiPens on its cruise ships and theme parks. It co-branded a website with Disney, “My Allergy Kingdom,” to promote the drug and recruited Mickey Mouse and Goofy to appear in children’s storybooks to push Mylan’s billion-dollar product.
After spending the last decade manipulating the government process, Bresch is now shedding crocodile tears. She says, “No one’s more frustrated than me” about the price increases and hopes to shift the blame to Congress. Bresch, however, lead Mylan in gaming the political process for years to fatten her payout to $18.9 million last year, a seven-fold increase since her company acquired the EpiPen.
The Mylan EpiPen scandal is not a story of inept regulation and a broken healthcare system. It’s a story about a political and healthcare system that’s fixed exactly how corporations intend.
Arun Gupta contributes to The Washington Post, YES! Magazine, In These Times, The Progressive, Telesur, and The Nation. He is author of the forthcoming, Bacon as a Weapon of Mass Destruction: A Junk-Food Loving Chef’s Inquiry into Taste, from The New Press. Follow him on Twitter @arunindy or email at [email protected]