Saturday, February 24, 2018
Business

Federal government: Mylan has been overcharging Medicaid for EpiPens

TRENTON, N.J. — Even the federal government is apparently paying too much for EpiPens, along with angry patients and insurers.

The skyrocketing price of the lifesaving allergy shot, which has triggered a storm of criticism, is only part of the problem. Now the federal government, responding to congressional inquiries, says Medicaid for years has been paying too much for EpiPens because the emergency shot is classified incorrectly as a generic medicine.

The federal government says EpiPen is a branded drug, which means the drug's maker, Mylan, should have been paying the government a far higher rebate under the government's complex pricing rules.

Mylan, which has been blasted for hiking the price of a pair of EpiPens to $608 from $94 since 2007, denies wrongdoing. It says that EpiPen meets Medicaid's definition of a generic product and that it was classified that way when Mylan acquired rights to the product in 2007.

The company could face steep penalties, though.

According to the Centers for Medicare & Medicaid, manufacturers that pay insufficient rebates may be fined by the Department of Health and Human Services for violating the rebate rules, sued for overcharging the government or hit with other penalties.

CMS spokesman Aaron Albright would not comment Thursday on whether the agency would try to correct the misclassification of EpiPen, recoup money or seek penalties from Mylan.

But in a letter sent late Wednesday to senators and congressmen probing EpiPen's exorbitant price hikes, Andy Slavitt, acting director of CMS, wrote that EpiPen doesn't meet the definition of a generic drug because it was approved as a brand-name drug and is protected by a patent. Slavitt wrote that CMS "has expressly told Mylan that the product is incorrectly classified."

Albright couldn't immediately say when Mylan was told that, but said the pharmaceutical industry was given guidelines explaining the classifications in 2010.

For nine years, the government says, Mylan has been paying rebates of 13 percent, as required for generic products, when it should have been paying the 23.1 percent rebate required for brand-name drugs.

In addition, CMS said Mylan hasn't been paying Medicaid a second rebate that is required whenever the price of a brand-name drug price rises more than inflation. The price of an EpiPen pack rose 23 percent a year on average between 2007 and 2016. Inflation has averaged less than 2 percent a year over the same period.

The prior maker of EpiPen apparently also was underpaying. CMS records indicate the product's status was changed from brand-name to generic in the fourth quarter of 1997, according to Slavitt's letter. It's unclear why the change was made.

Mylan said in a statement that it "simply continued to classify the product the same way," as that was "consistent with longstanding written guidance from the federal government."

The amount Medicare and Medicaid spent on EpiPens rose to $486.8 million in 2015 from $86.5 million in 2011, a jump of 463 percent, Slavitt's letter says.

In response, Senate Finance Committee member Ron Wyden, D-Oregon, and House Energy and Commerce Committee member Frank Pallone, D-New Jersey, said in a statement that Mylan is "bilking taxpayers out of millions of dollars.

Comments
Activists call for tech companies to drop NRA’s digital TV channel

Activists call for tech companies to drop NRA’s digital TV channel

Activists are calling for Apple, Amazon, Google and other streaming companies to drop the National Rifle Association’s digital TV channel in the wake of the mass shooting at a Florida school last week, putting the companies in the delicate position o...
Published: 02/24/18
Edward Peachey demands severance from CareerSource before stepping down

Edward Peachey demands severance from CareerSource before stepping down

The head of the Pinellas and Hillsborough career centers under multiple investigations into the way they report job placement figures says he has no intention of stepping down.That’s unless he is paid five months severance.In a letter from his attorn...
Published: 02/23/18
Terminally ill Valrico man dies a month after marrying junior high sweetheart

Terminally ill Valrico man dies a month after marrying junior high sweetheart

VALRICO — During his final few days, 19-year-old Dustin Snyder moved to a hospice house, surrounded himself with belongings from home, swam in a pool and visited the beach in Ruskin.Wherever he went, the terminally ill Valrico man had family beside h...
Published: 02/23/18
Tampa Downtown Partnership gets initial city okay to expand north

Tampa Downtown Partnership gets initial city okay to expand north

TAMPA — The Downtowner may be heading to Tampa Heights — but not until Oct. 1.That’s because the nonprofit Tampa Downtown Partnership this week won initial City Council approval to expand into Tampa Heights."Tampa Heights is becoming an important gat...
Published: 02/23/18

Tampa lawyer gets 27 months in federal prison for insider trading

Tampa lawyer Walter "Chet’’ Little was sentenced this week to 27 months in federal prison for engaging in an insider trading scheme that reaped him and a friend profits totaling nearly $1 million.According to federal authorities, Little accessed comp...
Published: 02/23/18
More companies are cutting ties with gun lobby as #BoycottNRA movement gains steam

More companies are cutting ties with gun lobby as #BoycottNRA movement gains steam

Three major companies — Enterprise Holdings, First National Bank of Omaha, and the cybersecurity giant Symantec — have ended co-branding partnerships with the National Rifle Association as a #BoycottNRA social media movement picks up steam.Enterprise...
Published: 02/23/18
Citi to refund $330 Million to credit card customers it overcharged

Citi to refund $330 Million to credit card customers it overcharged

Citigroup is preparing to issue $330 million in refunds after the bank discovered it had overcharged nearly 2 million credit card customers on their annual interest rates, a spokeswoman said Friday.The bank, which has about 150 million credit card ac...
Published: 02/23/18
Girl Scouts camp sold to member of Tampa’s Lykes family

Girl Scouts camp sold to member of Tampa’s Lykes family

ODESSA — The 63-year-old lakeside summer camp had no air conditioning or electricity. Cabin floors were often covered in grime, and cobwebs clung to the windows.But under new ownership, the 18.6 acres of Florida woods known as Camp Scoutcrest to memb...
Published: 02/23/18
BB&T cites ‘technical issue’ in outage affecting customers

BB&T cites ‘technical issue’ in outage affecting customers

Millions of BB&T customers were unable to access their accounts after a service outage which the bank blames on an equipment malfunction. The Winston-Salem, North Carolina-based bank posted a statement on its Twitter page saying the problem persiste...
Published: 02/23/18
Realtors are ‘every 10 feet’ in Florida but more want in the business

Realtors are ‘every 10 feet’ in Florida but more want in the business

ST. PETERSBURG — Tired of working as a yacht captain, Pancho Jiminez decided to get into real estate even though he knows it’s a highly competitive field in Florida."Realtors are every 10 feet around here," he says.Nonetheless, Jiminez is among 30 st...
Published: 02/23/18