The Epi-Pens cash grab

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The Epi-Pens cash grab

Post by Anaxagoras » Fri Aug 26, 2016 11:27 pm

Maybe this is just good old capitalism at work but it would be nice if they were at least honest about it.

Yeah we are jacking up prices so that our profits go up, our share price goes up, and our CEO can get a $19 million dollar bonus. Don't pretend you aren't shaking down people who need the drug to literally save their life.

Drug companies spend millions to keep charging high prices

Why the new EpiPen coupons are more about helping the company than helping you
Pharmaceutical heavyweight Mylan, the latest poster child for drug-industry greed, finally stuck up for itself Thursday. It argued that “the system,” not avarice, was to blame for the company jacking up the price of EpiPens, a common (and life-saving) allergy remedy, by over 400%.

“Look, no one’s more frustrated than me,” Mylan Chief Executive Heather Bresch declared on CNBC.

Actually, millions of people — those with chronic medical conditions or other illnesses — are more frustrated than her.
"No one’s more frustrated than me". Oh puh-leez lady, you got paid $19 million dollars last year. Cry me a river. The cost of making them can't have gone up by that much.



But sure, in a way it is "the system" that's to blame. It's a terrible system from the ground up. Obamacare didn't fix it because they were just trying to add something on top of a system that was already broken. The incentives are all perverse. For consumers, for doctors, for drug companies.

BTW, there is a cheaper alternative for informed consumers:
How to Get the Cheaper EpiPen Alternative

Even this one isn't exactly cheap, but it's about a quarter to a third of the price.
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Re: The Epi-Pens cash grab

Post by Tiosylanyl » Sat Aug 27, 2016 4:00 am

It's worth noting that this time a couple years ago there were probably 5-10 drug companies that produced generic products for exactly the same size/strength of this drug available on the market that were also auto-injectors, but have since expired. These alternatives were much more modestly priced judging from the AWPs I saw in Medispan the last time I checked. The prices for Epipen and Epipen Jr. started really creeping up around the time these generics started expiring. There are only a handful of alternatives currently out there. Despite what your link says about Adrenaclick being much lower priced, the difference is Only a couple hundred bucks. The package AWP on that is about $500 right now, whereas Epipen is a little over $700. Actual cost to the pharmacy varies from one to another, but will hover somewhere around those costs, and this is before their markup. The low prices cited in the link are after insurance contractual discounts and payments, or after discount cards are factored in, etc.


Part of the problem is that each auto injector is different in how it operates, and since the Epipen brand is the most well known and popular (due in part to Mylan's marketing, as mentioned in your link) there has been resistance in prescribing the alternatives or writing prescriptions to allow for generic substitution since most consumers were already used to it. The fear has been that there could be delay in administrating the product in a serious situation due to unfamiliarity with the mechanism of the generic.

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Re: The Epi-Pens cash grab

Post by Pyrrho » Sat Aug 27, 2016 11:47 am

It is safe to say that these prices do not go up by accident, nor are they entirely the result of market dynamics.

http://www.pmlive.com/pharma_intelligen ... ess_422511
The true meaning of market access?

Understanding fully the words that define market access is the first step on the route to success

Market access is the process to ensure that all appropriate patients who would benefit, get rapid and maintained access to the brand, at the right price.
Scroll down to "maintained access" and "right price" for the relevant details.

Basically, yes, companies will charge what the market will bear. Companies study the market very carefully to determine the range of prices they might be able to charge. No surprise there. They also work very hard to convince "payers" to reimburse.
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Re: The Epi-Pens cash grab

Post by Anaxagoras » Sat Aug 27, 2016 12:34 pm

Tiosylanyl wrote:It's worth noting that this time a couple years ago there were probably 5-10 drug companies that produced generic products for exactly the same size/strength of this drug available on the market that were also auto-injectors, but have since expired. These alternatives were much more modestly priced judging from the AWPs I saw in Medispan the last time I checked. The prices for Epipen and Epipen Jr. started really creeping up around the time these generics started expiring. There are only a handful of alternatives currently out there. Despite what your link says about Adrenaclick being much lower priced, the difference is Only a couple hundred bucks. The package AWP on that is about $500 right now, whereas Epipen is a little over $700. Actual cost to the pharmacy varies from one to another, but will hover somewhere around those costs, and this is before their markup. The low prices cited in the link are after insurance contractual discounts and payments, or after discount cards are factored in, etc.


Part of the problem is that each auto injector is different in how it operates, and since the Epipen brand is the most well known and popular (due in part to Mylan's marketing, as mentioned in your link) there has been resistance in prescribing the alternatives or writing prescriptions to allow for generic substitution since most consumers were already used to it. The fear has been that there could be delay in administrating the product in a serious situation due to unfamiliarity with the mechanism of the generic.
Makes perfect sense in a duopoly situation if there's only one generic alternative. Assuming the generic also wants to maximize his total profits, he should charge as much as he can but still be cheaper enough that price-sensitive consumers will choose the generic. You don't want to take away too much business from the name-brand, because they might respond by lowering prices and then you have to lower yours too. There's a sweet spot where both companies can do very well if they don't have a price war.
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Re: The Epi-Pens cash grab

Post by Pyrrho » Sat Aug 27, 2016 12:55 pm

Pharma companies reformulate as needed in order to delay generics from coming to market.
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Re: The Epi-Pens cash grab

Post by Tiosylanyl » Sat Aug 27, 2016 7:52 pm

Pyrrho wrote:Pharma companies reformulate as needed in order to delay generics from coming to market.
Not even necessarily that. They do things like change packaging, delivery mechanism, or pre-dilute where no other difference exists all the time that causes one NDC to expire and another to be created, which leads to them marketing as a new product, etc.

Now, for orphan drugs or high cost biologics for chronic illnesses, you're starting to see biosimilars getting approved by the FDA and trying to come to market which is causing uproar from companies that still hold patents on the original drugs. Granix, which is the biosimilar for Neulasta (filgrastim) is the only one currently out there. There is another for Remicade that is supposed to launch in October but Janssen is fighting it through the court system and may force the delay of the launch. Rumor has it that the biosimilar is supposed to be less than half the cost, so I'm surprised that there isn't more outrage on that.

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Re: The Epi-Pens cash grab

Post by Anaxagoras » Sat Aug 27, 2016 10:23 pm

Maybe my understanding of how patents work is not complete but why can't a generic just use the original recipe after the patent expires?
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Re: The Epi-Pens cash grab

Post by Tiosylanyl » Sat Aug 27, 2016 10:59 pm

Depends on the drug. When you hear of drugs going generic that's essentially what's happening, though I'm sure methods vary somewhat as I don't believe companies are sharing their "recipes" with potential competitors. Add to that that generic usually refers to small molecule compounds, whereas biosimilars are much more complex and may not exactly be the same, but has similar biologic effect. Celebrex and Cymbalta are examples of brands that went generic a couple years ago.

Orphan drugs and similar biologics operate under a different standard though. Patent terms are longer and the producer has greater control, among other incentives. Orphan drug law is in place specifically to give pharmaceutical companies incentive to develop drugs for rare diseases that would otherwise be financially unviable.

That said, if I remember correctly part of the issue is that Remicade is actually still under patent and that Inflectra is not molecularly identical

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Re: The Epi-Pens cash grab

Post by Anaxagoras » Wed Aug 31, 2016 5:10 am

Interesting, thought-provoking read:

http://slatestarcodex.com/2016/08/29/re ... vs-chairs/

Is the FDA too stringent? Maybe overregulation is the problem here?

Also, they grant patents too easily IMHO.
When Mylan decided to sell EpiPens for $300, in any normal system somebody would have made their own EpiPens and sold them for less. It wouldn’t have been hard. Its active ingredient, epinephrine, is off-patent, was being synthesized as early as 1906, and costs about ten cents per EpiPen-load.

Why don’t they? They keep trying, and the FDA keeps refusing to approve them for human use. For example, in 2009, a group called Teva Pharmaceuticals announced a plan to sell their own EpiPens in the US. The makers of the original EpiPen sued them, saying that they had patented the idea epinephrine-injecting devices. Teva successfully fended off the challenge and brought its product to the FDA, which rejected it because of “certain major deficiencies”. As far as I know, nobody has ever publicly said what the problem was – we can only hope they at least told Teva.

In 2010, another group, Sandoz, asked for permission to sell a generic EpiPen. Once again, the original manufacturers sued for patent infringement. According to Wikipedia, “as of July 2016 this litigation was ongoing”.

In 2011, Sanoji asked for permission to sell a generic EpiPen called e-cue. This got held up for a while because the FDA didn’t like the name (really!), but eventually was approved under the name Auvi-Q, (which if I were a giant government agency that rejected things for having dumb names, would be going straight into the wastebasket). But after unconfirmed reports of incorrect dosage delivery, they recalled all their products off the market.

This year, a company called Adamis decided that in order to get around the patent on devices that inject epinephrine, they would just sell pre-filled epinephrine syringes and let patients inject themselves. The FDA rejected it, noting that the company involved had done several studies but demanding that they do some more.

Also, throughout all of this a bunch of companies are merging and getting bought out by other companies and making secret deals with each other to retract their products and it’s all really complicated.

None of this is because EpiPens are just too hard to make correctly. Europe has eight competing versions. But aside from the EpiPen itself, only one competitor has ever made it past the FDA and onto the pharmacy shelf – a system called Adrenaclick.

And of course there’s a catch. With ordinary medications, pharmacists are allowed to interpret prescriptions for a brand name as prescriptions for the generic unless doctors ask them not to. For example, if I write a prescription for “Prozac”, a pharmacist knows that I mean anything containing fluoxetine, the chemical ingredient sold under the Prozac brand. They don’t have to buy it directly from Prozac trademark-holder Eli Lilly. It’s like if someone asks for a Kleenex and you give them a regular tissue, or if you suggest putting something in a Tupperware but actually use a plastic container made by someone other than the Tupperware Corporation.

EpiPens are protected from this substitution. If a doctor writes a prescription for “EpiPen”, the pharmacist must give an EpiPen-brand EpiPen, not an Adrenaclick-brand EpiPen. This is apparently so that children who have learned how to use an EpiPen don’t have to relearn how to use an entirely different device (hint: jam the pointy end into your body).

If you know anything at all about doctors, you know that they have way too much institutional inertia to change from writing one word on a prescription pad to writing a totally different word on a prescription pad, especially if the second word is almost twice as long, and especially especially if it’s just to do something silly like save a patient money. I have an attending who, whenever we are dealing with anything other than a life-or-death matter, just dismisses it with “Nobody ever died from X”, and I can totally hear him saying “Nobody ever died from paying extra for an adrenaline injector”. So Adrenaclick continues to languish in obscurity.
There's a lot that's interesting there, but just to focus on this one point:
"they had patented the idea epinephrine-injecting devices"

So, they didn't invent epinephrine. And they didn't invent injecting devices. But they claim that the idea of using an injecting device to inject epinephrine is their intellectual property, and nobody else can sell anything like that!

There is a principle that isn't applied stringently enough: Something that is "obvious", should not be patentable. But I guess "obvious" is a vague word. What might be obvious to you, may not be obvious to others, and vice versa. So when in doubt, good lawyers or patent attorneys can probably browbeat a patent examiner into accepting a borderline claim. Unlike in baseball, in patents you are allowed to argue balls and strikes, and a patent examiner has to respond to each point you make and refute it with evidence. And obviously there are going to be grey areas. So maybe nobody ever sold an epinephrine-injecting device before this company. But does that idea rise to the same level as a real invention? Like the telegraph or the light bulb?
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Re: The Epi-Pens cash grab

Post by Doctor X » Wed Aug 31, 2016 6:36 am

[youtube][/youtube]

as it ever is.

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Re: The Epi-Pens cash grab

Post by Anaxagoras » Wed Aug 31, 2016 7:26 am

One more thing from that blog:
So why is the government having so much trouble permitting a usable form of a common medication?

There are a lot of different factors, but let me focus on the most annoying one. EpiPen manufacturer Mylan Inc spends about a million dollars on lobbying per year. OpenSecrets.org tells us what bills got all that money. They seem to have given the most to defeat S.214, the “Preserve Access to Affordable Generics Act”. The bill would ban pharmaceutical companies from bribing generic companies not to create generic drugs.

Did they win? Yup. In fact, various versions of this bill have apparently failed so many times that FDA Law Blog notes that “insanity is doing the same thing over and over again and expecting different result”.
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Re: The Epi-Pens cash grab

Post by Doctor X » Wed Aug 31, 2016 7:52 am

As above.

This is the sort of thing that makes the Big Pharma Wackos shout: "SEE?!!!"

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"Doctor X is just treating you the way he treats everyone--as subhuman crap too dumb to breathe in after you breathe out."--Don
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Re: The Epi-Pens cash grab

Post by Tiosylanyl » Wed Aug 31, 2016 12:02 pm

The real sad part is there are multi-dose vials of epinephrine available for a substantially lower cost and syringes are cheap. They touch on part of the problem in the link you posted: physicians not prescribing generic alternatives. Part of it is understandable in that do you really want patients or their guardians wasting time messing around with drawing up doses and possibly fumbling in an emergency situation. That said, one could prep syringes in advance, end up wasting a doses, and still not spend as much as you do on Epipen.

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Re: The Epi-Pens cash grab

Post by ed » Wed Aug 31, 2016 12:10 pm

A dose is probably pennies.
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