Class Action Lawsuit Over EpiPen Pricing, Kickbacks Allowed to Proceed

A federal judge has cleared the way for an EpiPen class action lawsuit to move forward with claims involving bribery and price fixing, after rejecting a petition filed by the drug manufacturer that called for the claims to be dismissed.

Mylan has been the subject of Congressional hearings, lawsuits and public ridicule after drastically increasing the price of the epinephrine shots in 2007, after purchasing the EpiPen brand. Critics have claimed that Mylan is price-gouging consumers, by charging $600 for a pack of two EpiPens, which cost about $100 just 10 years ago.

Last year, Rochester Drug Cooperative and Dakota Drug, both drug wholesalers, filed lawsuits over EpiPen pricing and kickbacks to pharmacy benefit managers (PBMs), including CVS Caremark, Express Scripts and OptumRx. Those cases were consolidated last August.

The purpose of the kickbacks, according to the complaints, was to keep the pharmacies on Mylan’s side, so it could raise its prices on EpiPen without blowback. The pharmacy managers often serve as gatekeepers for the drug industry; if they do not like the price or think a drug is unnecessary, they will not sell them in major franchise chains, and insurers will often not cover those drugs.

Mylan filed a motion to dismiss the lawsuits, but U.S. District Judge Eric C. Tostrud, of the District of Minnesota, issued an opinion and order (PDF) on January 15, rejecting Mylan’s petition and clearing the way for the class action lawsuits to proceed.

“Plaintiffs claim that Mylan paid rebates and other fees not only to secure formulary placement but also to induce PBMs to abandon their role as a price disciplinarian in the market,” Judge Tostrud wrote. “These allegations make it plausible to believe that Mylan’s bribes were more than ‘a simple case of buying influence’.”

EpiPen is the brand name for epinephrine auto-injectors made by Mylan Pharmaceuticals. They are auto-injectable devices intended to deliver epinephrine to individuals experiencing a severe allergic reaction, known as anaphylaxis. Epinephrine shuts down the body’s allergic response by constricting the blood vessels, leading to increased blood pressure, and decreased swelling.

The emergency allergy auto-injectors provide a critical treatment for individuals with severe allergies or asthma attacks. Many individuals carry an EpiPen at all times to inject epinephrine, a chemical that narrows blood vessels and opens the airways to the lungs, in the event they are having a serious or life-threatening allergy or asthma attack.

The pens contain epinephrine, commonly referred to as adrenaline, a hormone that can reverse severe low blood pressure and increase the heart rate, muscle strength, blood pressure, and sugar metabolism. Treatment of epinephrine can also reverse wheezing, severe skin itching, hives and various other symptoms of an allergic reaction.