Mylan agrees to US$465 million settlement over EpiPen classification

Mylan agrees to US$465 million settlement over EpiPen classification

USA lawmakers have contended that Mylan underpaid rebates to state Medicaid programs by misclassifying EpiPen as a generic instead of a branded drug. Over the five-year period, government health plans spent over $1 billion on EpiPens. Mylan, now in the crosshairs over severe price hikes for its EpiPen, said Thursday, Aug. 25, 2016, it will expand programs that lower out-of-pocket costs by as much as half.

How was Mylan ripping off the government? According to the Centers for Medicare and Medicaid Services (CMS), Mylan should have been reimbursing the government under the brand name rate of 23.1 percent. In the case of generic drugs, that reimbursement is just 13 percent. It's unclear why the issue was not resolved earlier, but Slavitt said it is up to a company to provide accurate information and pay out the proper rebate amounts. Still, Slavitt says CMS can not presently comment on the total amount of rebates Mylan owes due to the misclassification.

Mylan, which will make the payment to the Department of Justice and other government agencies, said the settlement does not include any finding of wrongdoing.

"Today's letter is more evidence that while Mylan irresponsibly raised the price of EpiPen, they were also bilking taxpayers out of millions of dollars", the lawmakers said in a joint statement, adding they would "ensure taxpayers get their due".

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