Pharma giant Mylan’s (MYL) controversial price hike for the life-saving EpiPen device drew a sharp rebuke from Democratic presidential contender Hillary Clinton on Wednesday. But the company has at least one defender: biopharma black sheep Martin Shkreli.
Mylan has raised the price for the EpiPen, an auto-injector device that delivers epinephrine to counteract deadly allergic reactions which must be replaced on a yearly basis, more than 400% over the last decade, putting families who have high deductible health insurance in a bind. Mylan has a near-monopoly in the space and Clinton called the move “outrageous.”
“[I]t’s just the latest troubling example of a company taking advantage of its consumers,” she said in a statement. “It’s wrong when drug companies put profits ahead of patients, raising prices without justifying the value behind them.”
Clinton went on to reiterate her position that drug price hikes should be linked with better patient outcomes and demonstrated improvements in value, and demanded that Mylan “immediately reduce the price of EpiPens.” Minutes after Clinton released her statement, White House press secretary Josh Earnest said that “greedy” pharmaceutical companies which jack up costs “often do real damage to their reputation” during a media briefing (while declining to “second guess” Mylan’s specific pricing strategies).
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A number of lawmakers have also come out swinging against Mylan in recent days. Minnesota Democrat Sen. Amy Klobuchar, whose daughter has food allergies, called for a Senate hearing and Federal Trade Commission (FTC) probe into the matter on Monday, and Republican Chuck Grassley of Iowa sent Mylan CEO Heather Bresch a letter describing the consequences the price hike has had for his constituents.
On Wednesday, the Senate Special Committee on Aging, which has investigated price increases by Valeant (VRX) and other drugmakers, sent its own letter to Bresch demanding information about the EpiPen’s pricing and market share since 2007. The company has said that it’s eager to cooperate with the lawmakers and answer their questions but Mylan shares tumbled in reaction and ended the session down 5.6% while the broader NASDAQ Biotechnology Index fell about 3.5%.
And then there’s Martin Shkreli. Infamous for his own drug price hikes at former firm Turing Pharmaceuticals and current indictment on securities fraud charges, Shkreli began a defense of Mylan during a Tuesday interview with CBS News. “I think important medicine should be expensive because they’re valuable,” he said, asserting that it’s insurance companies’ responsibility to make sure such price hikes don’t adversely affect patients.
The investor-turned-pharma exec elaborated further in a series of tweets on Wednesday, arguing that Mylan’s profit margin isn’t nearly high enough and that CEO Bresch’s compensation package (which has come under scrutiny) isn’t particularly lavish if you’re only considering salary.
Mylan has defended its EpiPen pricing by pointing to patient assistance programs and coupons that reduce the device’s cost. But its shares have taken a beating amid the media coverage and political scrutiny, falling about 11.5% in the past three days.