Imagine our surprise after the story we decided to cover concerning shameful companies (part of our series that also included admirable and questionable companies) became a national story. Now, we don’t take the claim for this, but are happy to have played a (non-existent) part.
Recap: Our story covered how pharmaceutical companies are abusing their patents to charge unfair prices. This comes about because they have pricing power due to their patent granting them a monopoly. Important to mention is that patents expire every thirty years, however big pharma companies have been engaging in a process called ever-greening. Essentially. through small tweaks to the drugs, that are nearly indiscernible to the patient, companies unnaturally extend their patents and fight off generic competitors. Sometimes they even buy their competitors to ward off generics.
The company we chose for highlighting this issue was the manufacturer of the Epipen Mylan. This company had one other competitor in the market, which was forced to shut down its plant for a time. Mylan took advantage of this artificial monopoly and hiked the prices of its drugs over 200%.
The CEO of the company was eventually called to testify in front of Congress. (Video below) While the dust has yet to fully settle, it appears Mylan has been forced into repricing the Epipien via discounts and other programs. Hopefully this serves to send a message to the big pharmaceutical companies that they should not hike prices without reason.
Part of the reason this has failed to be an issue for so long is because insurance has traditionally covered nearly the whole cost of drugs. Thus, any price increases wouldn’t necessarily be seen by the end user. Just the company footing the bills. However, recent changes in the insurance industry have led to more patients footing the bill.
You can hear what the CEO has to say and share your thoughts in the comments below.