The head of the pharmaceutical company that makes EpiPens raised the price of the life-saving device by over 400%. She was rewarded with a 671% raise.
EpiPens are drug-filled devices that people with severe allergies and their caregivers can use to inject epinephrine quickly, to halt potentially deadly allergic reactions.
Mylan Pharmaceuticals CEO Heather Bresch and other execs are under fire for spiking the price of the device from under $100 for a pair in 2007 to over $500 today.
Bresch was president of Mylan in 2007, and later became CEO. Nine years ago, her pay was $2,453,456. In 2015, it was $18,931,068, according to Mylan corporate filings.
“During the same period, the company raised EpiPen prices, with the average wholesale price going from $56.64 to $317.82, a 461 percent increase, according to data provided by Connecture” to NBC News.
Heather Bresch, CEO of drugmaker Mylan Inc., speaks during an interview in New York, U.S., on Thursday, Jan. 8, 2015.
NBC first reported Bresch's “stratospheric” pay increase.
From NBC's original report:
In 2007 the company bought the rights to EpiPen, a device used to provide emergency epinephrine to stop a potentially fatal allergic reaction and began raising its price. In 2008 and 2009, Mylan raised the price by 5 percent. At the end of 2009 it tried out a 19 percent hike. The years 2010-2013 saw a succession of 10 percent price hikes.
And from the fourth quarter of 2013 to the second quarter of 2016, Mylan steadily raised EpiPen prices 15 percent every other quarter.
The stock price more than tripled, going from $13.29 in 2007 to a high of $47.59 in 2016.
And while sales of the life-saving drug rose to provide 40 percent of the company's operating profits in 2014, as Bloomberg reported, salaries for other Mylan executives also went up. In 2015, President Rajiv Malik's base pay increased 11.1 percent to $1 million, and Chief Commercial Officer Anthony Mauro saw his jump 13.6 percent to $625,000.
Records at opensecrets.org show that when Mylan acquired EpiPen, the company also amped up its lobbying. In 2008, Mylan's reported spending on lobbying jumped from $270,000 to $1.2 million.
The story has captured the attention of Capitol Hill. On Monday, the Senate Judiciary Committee demanded information on the EpiPen price increases.
Senator Chuck Grassley, chairman of the Senate Judiciary Committee, wrote Mylan Chief Executive Heather Bresch on Monday to ask how Mylan determined the price of EpiPens and what changes had been made to the product to account for the higher price.
The top Democrat on the committee's antitrust subcommittee, Senator Amy Klobuchar, urged the Federal Trade Commission on Monday to investigate the prices, citing news reports showing that the price of a pack of two EpiPens had gone from $100 in 2008 to $500 this year. Mylan acquired the product in 2007.
"Although the antitrust laws do not prohibit price gouging, regardless of how unseemly it may be, they do prohibit the use of unreasonable restraints of trade to facilitate or protect a price increase," wrote Klobuchar, a Minnesota Democrat who said her daughter relies on an EpiPen.
"The FTC should investigate whether Mylan Pharmaceuticals engaged in activity, such as using incentives or exclusionary contracts with insurers, distributors, or pharmacies, to deny an alternative product access to the market."
Related reading on this story, which sheds light on how and why pharmaceutical patents and American health care are so broken:
• “How Marketing Turned the EpiPen Into a Billion-Dollar Business” [BLOOMBERG]
• “The EpiPen, a Case Study in Health Care System Dysfunction” [NYT]
• “How Congress, the FDA, and Sarah Jessica Parker Helped EpiPen Become a $1 Billion Business” [GIZMODO]
