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In August 2017, the U.S. Attorney’s Office of the Federal Justice Department announced that Mylan Inc., a large pharmaceutical company, and Mylan Specialty L.P. settled a federal liability case by paying $465 million. The federal government had alleged that both companies violated the U.S. False Claims Act when they misclassified their brand-name EpiPen ‘epinephrine delivering device’ as a generic product, which allowed them to underpay Medicaid on earned rebates.
This financial settlement agreement followed the March 2017 announcement by Pennsylvania-based Mylan N.V. that their manufacturing partner Pfizer-owned Meridian Medical Technologies would expand a voluntary recall of their defective EpiPen auto injectors. This involved selected lots of the brand-name delivery device that included the EpiPen and EpiPen Junior. The generic forms of the epinephrine delivery device were not included in the voluntary recall.
The financial agreement between the Justice Department and the pharmaceutical giants will resolve allegations involving inappropriate behavior that occurred between July 2007 and March 2010. The Justice Department claims that false statements were submitted to the CMS (Centers for Medicare and Medicaid Services) by Mylan. The federal government also claims that Mylan misclassified the EpiPen device as a generic product instead of a branded product and that this was done to deceive Medicaid when underpaying rebates owed to state agencies that receive federal funds.
The Office of Inspector General of the U.S. Department of Health and Human Services released an analysis in May 2017 stating that Medicaid may have overpaid Mylan more than $1.2 billion for EpiPen devices that were purchased from 2006 through 2016. If that number is accurate, the device manufacturer simply gave back $465 million of the $1.2 billion they overcharged Medicaid.
The acting US Attorney William Weinreb stated that “Mylan misclassified its brand-name drug, EpiPen, to profit at the expense of the Medicaid program” and that “taxpayers rightly expect companies like Mylan that receive payments from taxpayer-funded programs to scrupulously follow the rules. We will continue to root out fraud and abuse to protect the integrity of Medicaid and ensure a level playing field for pharmaceutical companies.”
A Response by Congress
Two members of the U.S. Senate made outspoken statements over the recent announcement of Mylan’s agreement with the Federal Justice Department. Republican Senator Chuck Grassley of Iowa shared his disappointment with the media over the final agreement saying that it “looks like the settlement amount short-changes the taxpayers.”
In a separate announcement, U.S. Senator Richard Blumenthal of Connecticut called the settlement agreement “completely insufficient” and that “Absolving Mylan from the findings of wrongdoing is clear the way for the company to pocket the money it embezzled from the American public in desperate need of life-saving and affordable medications.”
In previous years, Congress enacted laws including the Medicaid Drug Rebate Program to prevent price gouging by drug manufacturers that file monetary claims with State-regulated Medicaid programs. These price gouging laws help prevent the government’s susceptibility of paying too much to drug manufacturers that provide single-source medications.
An EpiPen contains epinephrine, a life-saving treatment used to combat anaphylaxis, which is a potentially fatal allergic reaction that can occur when consuming medications/supplement/food like anti-seizure drugs, NSAIDs (nonsteroidal anti-inflammatory drugs like ibuprofen or aspirin), and antibiotics including penicillin and amoxicillin along with soy, wheat, fish, eggs, milk, shellfish or nut based products, or as a reaction to bee stings and insect bites. The allergic reaction that can lead to anaphylactic shock can be mild in nature or deadly, even to individuals who had a previous mild reaction to an allergen.
While some allergic reactions can be stopped with one injection of epinephrine-filled EpiPen delivery system, sometimes, multiple injections are required. In many cases the individual might know exactly what caused their allergic reaction because they experience similar previous anaphylactic episodes, others will have no idea what caused an unexpected reaction to a product, dust, food, medication or insect bite.
The epinephrine loaded inside the EpiPen can be injected directly into the body by the individual experiencing the allergic reaction, by a trained clinician, or a bystander. The drug is most effective when the epinephrine is injected into the thigh of the patient to allow the medication to directly enter muscle tissue. The Food and Drug Administration reported that in recent years two different incidences of product failure occurred during while the drug was being administered. Fortunately, in both cases, there was a backup EpiPen device that was easily accessible to ensure the life-saving medication epinephrine could be delivered prior to the serious incident becoming catastrophic.
Identifying Anaphylactic Shock
Any delay in administering life-saving epinephrine when someone is experiencing anaphylactic shock could produce serious negative consequences including death. Many of the symptoms associated with anaphylaxis include:
- Uncontrollable wheezing and coughing
- Constricted breath
- Hoarseness in the throat
- Tightening in the lungs
- Welts and/or hives
- Weakened, rapid pulse
- Fainting or dizziness
- Low blood pressure
- Swollen tongue, lips, face, or throat
The most common symptoms and signs associated with anaphylactic shock happen quickly when the victim is exposed to a harmful allergen. While some individuals go into shock immediately after exposure, typical reactions tend to occur in less than thirty minutes after exposure to the allergen. However, an injection of epinephrine can quickly reverse many of the symptoms associated with an allergic reaction in a couple of minutes. To be effective, the EpiPen must contain high-quality epinephrine and the device should work as designed. Any failure of the epinephrine delivery device could cause serious health complications or immediate death.
EpiPen Recall Forced Device Exchange
Out of millions of patients who could experience anaphylactic shock, hundreds of thousands of individuals have a severe allergic reaction every year, especially teens, tweens, and young children. Because of that, in 2015, doctors prescribed EpiPen epinephrine-delivering products to more than 3.5 million adults and children in the United States.
This unique health crisis involving the ongoing need for quick access to epinephrine makes any defective EpiPen device a catastrophic event that could have been prevented. This is because the epinephrine injected when needed can reverse anaphylactic shock caused by a severe allergic reaction. Although the EpiPen manufacturer committed to replacing every device that had been voluntarily recalled, exchanging each unit took time and forced many patients to carry their defective product in their possession until the exchange took place.
EpiPen Lawsuits and Investigations
Defective medical devices are nothing new. For decades, many medical device manufacturers have had to recall their products to protect the public against the damaging or fatal effects of using defective units in times of crisis. Even though many of the products in the thirteen lots marked with manufacturing expiration dates including April 2017, September 2017 & October 2017 expiration dates, most units were likely not defective. However, there was no way to test the device without activating its “single use” feature, rendering it useless.
This was not the first time that Mylan and Pfizer, the manufacturers of the EpiPen, had come under fire from the federal government and patients. The public and media had accused the pharmaceutical giants of price gouging when the price of a two-pack EpiPen package increased from $57 in 2007 to more than $600 in 2015. This represented an increase of more than 500%.
The public outrage and media firestorm ignited a response from the Committee on Oversight and Govern Reform in the U.S. House of Representatives that forced the CEO of the company to testify. The committee wanted to understand why the company had shamefully increased the price of the device and deceptively misclassified the EpiPen (for adults) and EpiPen Junior (for children). The actions by the Oversight Committee led to an intensive investigation by the U.S. Department of Justice under the Office of the U.S. Attorney that resulted in a subsequent fine of $465 million.
Many patients responded to the pharmaceutical companies’ deceptive practices of price gouging and poor manufacturing processes that led to overcharging and selling defective devices by filing lawsuits. This includes antitrust lawsuits that have been filed over the manufacturer’s violation of antitrust laws that prevent companies from allowing generic versions of branded devices and medicines from entering the medical marketplace.
The Need to Sue Mylan
In 2012, Teva Pharmaceuticals, a giant generic medicine maker and medical device manufacturer, attempted to make a generic equivalent of an EpiPen available to a needing public. However, Mylan Inc. and Mylan Specialty L.P. filed a lawsuit against Teva claiming that generic medicine manufacturing company had infringed on their patent. A settlement was reached between the two parties that would allow Teva Pharmaceuticals to bring a generic version of the product to the medical marketplace by 2015.
While this is often normal business practice, in January 2015, Mylan petitioned the Food and Drug Administration to deny Teva approval for their generic equivalent product from entering the medical marketplace. After the citizen’s petition was filed, Mylan produced a product analysis showing dissimilarities between their branded device and the generic device. The FDA eventually blocked the approval of the generic version manufactured by Teva claiming unspecified deficiencies had been found in Teva’s application.
Individuals are currently filing a lawsuit against Mylan because the company deceived the public, overcharged for their product and sold defective devices. These plaintiffs are patients who have received EpiPen prescriptions from their doctor and medical professional EpiPen buyers including medical offices, pharmacies, and institutions.
Hiring a Lawyer
If you, or a loved one, have suffered injuries by a defective EpiPen, you are likely entitled to receive financial compensation from the drug manufacturer. Our experienced Essure attorneys at the Drug Law Center can help you file your claim for financial compensation. We accept these cases through contingency fee arrangements. This means no upfront fees are necessary. Contact us today to schedule a free, no-obligation initial consultation.