It’s been a bad week for Mylan.
The generic drugmaker is under fire after lawmakers including Democratic presidential nominee Hillary Clinton have spoken out on the price of the EpiPen, a device used to treat anaphylaxis, a severe allergic reaction.
The price of an EpiPen two-pack has risen to $600 from just $100 in 2007, when Mylan acquired the drug as part of Merck’s generics unit. For patients who have severe allergies — like a nut allergy, for example — EpiPen can be a life-saving device.
And who knows more about catching the ire of lawmakers for raising the price of a potentially life-saving drug than Martin Shkreli?
In an interview on CBSN that aired Tuesday, Shkreli said that really, the insurance companies are to blame for these price increases in what are effectively generic drugs.
“The fault here, and I don’t love to blame my payors, lies with the insurance companies,” Shkreli said.
“At $300 a shot, EpiPen is a pretty good deal. It saves you all of the costs of going to the hospital — just an ambulance ride can be a thousand dollars — so for $300 you can save five-, or ten-, or twenty-thousand dollars. It’s actually a pretty good bargain. If you’re an insurer, you should love to pay for this stuff.”
When pressed on whether we should be calling a potentially life-saving medicine a “good deal,” Shkreli said, “The point is, the patient should never pay a dime.”
Shkreli came into the public eye around this time last year when a New York Times report noted that his company, Turing Pharmaceuticals, had raised the price of a drug called Daraprim to $750 a pill from $13.50, a roughly 5,000% price increase. Turing’s price-hike, unlike Mylan’s increase in EpiPen prices, came in one fell swoop.
Shkreli added that while we’re talking about Mylan and the price they have put on EpiPen, no one is really thinking about the company’s business more broadly.
Mylan is a generics company that usually sells drugs at a discount to branded alternatives. In this, the EpiPen is an odd product for them. “At the end of the day,” Shkreli said, “Mylan’s not doing that well.”
In an interview on CNBC that aired Thursday, Mylan CEO Heather Bresch sort of echoed Shkreli’s comments that this is an insurance issue, though Bresch more broadly blamed the whole healthcare system for the price increase.
“This isn’t an EpiPen issue. This isn’t a Mylan issue. This is a healthcare issue,” Bresch said. “The irony is that the system incentivizes higher prices, and it’s the conversation that no one has wanted to have.”
The broad outline here is that a higher-priced drug allows all of the people who touch the drug between the drugmaker and the patient — insurers, retailers, pharmacy benefit managers — to make more money. You can skim more off a $600 drug than a $100 drug, basically.
Bresch also compared the healthcare market to the mortgage market in 2007.
“This bubble is going to burst,” Bresch said.