Pharma

Mylan settles EpiPen Medicaid rebate case for $465M, stock jumps

Mylan settled with the U.S. Department of Justice to head off potential Medicaid liability claims by federal and state governments.

EpiPen Prices Soar, Rattling Consumers

Pharma giant Mylan has agreed to pay the federal government $465 million to settle questions of how the company’s EpiPen was classified under the Medicaid Drug Rebate Program. Mylan announced the deal late on Friday afternoon.

According to Mylan, the company settled with the U.S. Department of Justice and other federal agencies to head off potential Medicaid liability claims by federal and state governments. The drug-maker, which bought the rights to EpiPen in 2007, did not admit to any wrongdoing.

The company has been under fire since August, when consumers, medical professionals and lawmakers started pushing back against steep price hikes for EpiPen epinephrine auto-injectors. The inflation happened as Mylan CEO Heather Bresch had her total compensation increase by 671 percent between 2007 and 2015.

In a statement, the embattled Bresch was unapologetic. She said:

This agreement is another important step in Mylan’s efforts to move forward and bring resolution to all EpiPen Auto-Injector related matters. The agreement is in addition to the significant steps Mylan has taken in relation to EpiPen Auto-Injector over the past several weeks, including the unprecedented, pending launch of a generic version of EpiPen Auto-Injector and expansion of our patient access programs for this product. Entering into this settlement is the right course of action at this time for the company, its stakeholders and the Medicaid program.

But the company still hasn’t budged on calls to lower the price of EpiPens or to roll back Bresch’s compensation. In fact, the settlement seems to be helping Mylan on Wall Street.

As Forbes reported late Friday, news of the settlement sent Mylan shares up by more than 10 percent in after-hours trading. The stock price was at $39.66 at 6:24 p.m. Eastern, more than making up for a loss during regular Nasdaq trading hours.

Photo illustration: Joe Raedle/Getty Images

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