EpiPen: What Accounts For The Spiraling Costs Of A Life-Saving Generic Medication?

IMG_7187I hold in my left hand an EpiPen, self-described as a “0.3 mg epinephrine auto-injector.” The EpiPen is a marvel of modern manufacturing. Take it out of its solid, clear,  plastic enclosure and you will notice instructions on how to use it in simple text and cartoons.

 

Basically, pull up the blue plastic piece at the top and you have activated it: now grasp the body and swing it down to your thigh , pushing the orange tip until it clicks, indicating the needle has emerged and injected life-saving epinephrine into the large muscle in your leg.IMG_7186

Epinephrine injections are the treatment of choice for severe allergic reactions. I have kept  EpiPens around me since my first episode of anaphylaxis after eating pecans as a child (see my post on nuts, legumes, drupes and mortality here) and can attest to how easy this is to use in treatment of an acute case of anaphylaxis.

About 12 years ago, when I lived in Louisville, Kentucky I was receiving allergy shots for chronic allergic rhinitis and conjunctivitis. One day I worked out after my shot and I suddenly began itching all over. Hives appeared on my chest and my face began swelling. I found it hard to breathe.

I was experiencing anaphylaxis, a severe, rapid and sometimes fatal allergic reaction that can occur after insect bites or stings, certain food consumption (I’ve had it to pecans, cashews, and  walnuts), and medications.

Fortunately, I had in my possession two EpiPens and even more fortunate they were  non-expired EpiPens. I quickly dressed, grabbed the EpiPens and had my then wife drive me to the closest ER.

After a few minutes I realized I was getting worse and opened up the first Epipen and jammed the needle into my thigh. I continued to get worse-my breathing became severely labored-and I grabbed the second EpiPen and repeated the thigh stabbing. Alas, the situation did not immediately improve and I made a command decision to stop at a fire station we were passing. There I was bundled into an ambulance, given IV steroids and oxygen and ultimately ended up in  an ER.

Epinephrine directly stimulates alpha and beta-receptors of the sympathetic nervous system and after the injections I felt like I had consumed 10 cups of coffee. My heart was racing, my blood pressure sky high and I was shaking uncontrollably. This is not a drug you want to take unless you desperately need it. In my case and thousands of others with anaphylaxis it is life-saving.

Consequently, I carry one with me at all times and as knowledge of food anaphylaxis and its treatment has spread in the last decade, Epipen sales and profits have exploded.

EpiPen Success: Marketing and Lobbying

Screen Shot 2016-08-27 at 10.03.59 AM
As this graph demonstrates, the annual sales increase in EpiPen for Mylan rose from 200 Million to over a billion driven by a combination of increased volume of sales and increased per device cost.

Last September,  Bloomberg published a story on the brilliant marketing of Mylan that turned EpiPen into a billion-dollar product. The Bloomberg article noted that the CEO of Mylan, Heather Bresch (who is the daughter of Democratic Senator Joe Manchin of West Virginia)  “turned to Washington for help”:

In 2010 new federal guidelines said patients who had severe allergic reactions should be prescribed two epinephrine doses, and soon after Mylan stopped selling single pens in favor of twin-packs. At the time, 35 percent of prescriptions were for single EpiPens. The U.S. Food and Drug Administration had changed label rules to allow the devices to be marketed to anyone at risk, rather than only those who’d already had an anaphylaxis reaction. “Those were both big events that we’ve started to capitalize on,” Bresch said in October 2011.

In 2013, the year following the widely publicized death of a 7-year-old girl at a school in Virginia after an allergic reaction to peanuts, Congress passed legislation encouraging states to have epinephrine devices on hand in schools. Now 47 states require or encourage schools to stock the devices.

Recent Furor Over High EpiPen Prices

In the last few days, the rising cost of EpiPens has become front page news. Although the active ingredient, epinephrine, is generic and cheap, and the basic delivery system has been around for decades,  Mylan, the company that purchased the rights to EpiPen in 2007 has increased its price from 57$ per injector to 600$ for 2 injectors.

Lack of generic competition to the EpiPen  is the primary reason that the price could be raised so much and also explains in many circumstances why drug costs are high in the US.

The US has long spent more on prescription medication than other IMG_7188countries. In 2013 per capita US spending on rx drugs was $858 compared to $400 for 19 industrialized anations.

Examples of markedly higher prices in the US are the statin drug crestor (216$/month for 10 mg in US versus $46 in France) and the asthma inhaler Advair ($216 US versus $20 in France.)

A recent article in JAMA analyzed the sources of the high prices in the US and concluded it is due to the fact that “unlike nearly every other advanced nation, the US health care system allows manufacturers to set their own price for a given product. In contrast, in countries with national health insurance systems, a delegated body negotiates drug prices or rejects coverage of products if the price demanded by the manufacture is excessive in light of the benefit provided.”

The ability of drug companies in the US to maintain high prices, the article points out, is due to 2 market forces: protection from competition and negotiating power.

Interestingly, last year , Mylan moved its corporate address overseas to lower its U.S. taxes in a transaction known as an inversion and is now incorporated in the Netherlands,

Bresch, the Mylan CEO is quoted as saying “We do subsidize the rest of the world… and as a country we’ve made a conscious decision to do that,” Bresch said. “And I think the world’s a better place for it.

Perhaps it would be better if the US, instead of having Congress rush into action and investigations when certain drug costs become worthy of news articles and public shaming, had a system in place like most other industrialized nations, that monitored and regulated drug costs.

Under such a system, life-saving medications like the EpiPen would not arbitrarily quadruple in price.

Anaphylactically Yours,

-ACP

 

 

 

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