Medicare & Medicaid News for Senior Citizens
Medicare & Medicaid News
EpiPen loses fight claiming to be generic; will save Medicaid millions
Settlement calls for $465 million payment to government
Aug. 18, 2017 - The Department of Justice yesterday announced a $465 million settlement pertaining to Maylan’s claims that EpiPen is a generic drug. Mylan and its auto-injector product have been at the center of the national debate over prescription drug costs.
Per the agreement, Mylan will reclassify EpiPen as a brand name drug consistent with the Medicaid statute and regulations.
In addition, Mylan has agreed to use the correct reference price of the 3rd quarter of 1990 for the purpose of calculating inflationary payment rebates under the Medicaid Drug Rebate (MDR) program, saving the Medicaid program hundreds of millions of dollars. These changes will be effective retroactive to April 1, 2017.
“Mylan’s agreement with CMS to correctly classify EpiPen is a huge win for Medicaid beneficiaries and American taxpayers,” said CMS Administrator Seema Verma.
“Medicaid will no longer be overcharged for EpiPen, protecting access for Medicaid beneficiaries who rely on this lifesaving drug while saving hundreds of millions of dollars. This announcement puts drug manufacturers on notice that CMS remains vigilant in our duty to protect the integrity of the Medicaid program.”
HHS' Office of the Inspector General estimated the misclassification cost Medicaid $1.27 billion in lost rebates from 2006 to 2016.