Last week, when Mylan CEO Heather Bresch told a congressional panel that her company only makes $50 profit per EpiPen — the emergency allergy treatment that has risen in price by 600% in recent years — lawmakers found that hard to believe. And now that Mylan has revised that profit figure to $80 per EpiPen, the company’s critics are only getting louder.
Rep. Elijah Cummings (MD), who last week accused Mylan of getting “filthy rich at the expense of our constituents,” is now calling into question the company’s revised profit margin, which was 60% higher than Bresch’s figure given during congressional testimony last week, CNBC reports.
“We didn’t believe Mylan’s numbers last week during their CEO’s testimony, and we don’t believe them this week either, which is why we gave them 10 days from the date of our hearing to produce their internal files,” Cummings said.
That means Mylan has until Friday to provide Congress with documents that will help determine what the company’s actual profits are for the drug, which rose in price nearly 600% in the last nine years.
Others in D.C. joined Cummings in arguing that the profit revision only raises more questions about EpiPens.
“Mylan continues to evade honesty about the costs associated with the EpiPen,” Sen. Amy Klobuchar (MN) said in a statement to StatNews, adding that the profit revision “illustrates the need for further investigations.”
Rep. Buddy Carter (GA), who was on last week’s panel, is similarly critical about this apparent lack of transparency.
“Even after the CEO of Mylan told me under oath that Mylan’s profit per EpiPen is $50, we still don’t know if the information she provided is correct, and that’s a real problem,” Carter told StatNews.
In 2009, a two-pack of EpiPens had a sticker price of around $100. That same pair of auto-injectors now sells for $608.
On Monday, the pharmaceutical giant clarified Bresch’s statements, noting that her $104 per two-pack figure is Mylan’s profit after taxes. Before taxes, the profit is $88 per pen, or $166 per two-pack.
“Tax is typically included in a standard profitability analysis and the information provided to Congress has made clear that tax was part of the EpiPen Auto-Injector profitability analysis,” the company tells CNBC.
Still, the explanation wasn’t greeted with rounds of “oh, that makes sense.” Instead, the Wall Street Journal raised concerns about how the company came up with its numbers.
For example, the $52 figure applies the maximum 37.5% corporate income tax rate to EpiPen earnings, while the company as a whole only paid 7.4% in taxes.
Analysts told the WSJ at the time that the 37.5% tax rate Mylan applied to the EpiPen “has nothing to do with reality.”
Lawmaker: ‘We don’t believe’ Mylan on new profit numbers for EpiPens [CNBC]
by Ashlee Kieler via Consumerist
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