The Untold EpiPen Story: How Mylan Hiked Prices by Blocking Rivals

Abstract

In the summer of 2016, Mylan found itself under fire for high EpiPen prices. Between 2009 and 2016, Mylan raised the price of this life-saving device, which delivers epinephrine to treat anaphylaxis shock, 15 times, resulting in an increase of more than 400%. The medicine in an EpiPen costs only pennies per dose. But a pack of two, which needs to be replaced each year, costs more than $600.

Many reasons have been offered for the price hike: a slow-moving FDA approval process, broken healthcare system, and convoluted distribution chain, for starters.

But missing in this debate has been Mylan’s role in clearing the field of present and future competitors. Piecing together this stealth campaign in outlining a potential antitrust case is the goal of this Essay. After providing a history of the product, it investigates Mylan’s blocking of future competitors, most notably Teva, through an entry-delaying settlement and a questionable citizen petition. It then examines Mylan’s blocking of present competitors, including Adrenaclick and Auvi-Q, by requiring schools to agree not to stock their products.

Mylan’s full range of behavior raises significant antitrust concerns and deserves a thorough investigation. Given the consequences of a $600 treatment for a life-saving device and an array of conduct that exploited the litigation process through settlement, the administrative process through FDA citizen petitions, and the auto-injector school laws through exclusive dealing, the public deserves no less.

Keywords: EpiPen, Mylan, antitrust, settlement, citizen petition, exclusive dealing, Teva

JEL Classification: I18, K21, L40, L41, L43, L65, O34, O38