New competitor and Cigna switch for Mylan's EpiPen

There were two new developments in the backlash against Mylan’s (Nasdaq: MYL) US pricing policy for its EpiPen Auto-Injector (epinephrine injection, USP) this week.

The Netherlands-incorporated company has increased the price of the allergy injection product by 500% since acquiring it in 2007. With its cost reaching more than $600 for a two-pen pack, there was a public outcry over the price this summer, leading Mylan’s chief executive Heather Bresch to face questions in the Senate and prompting the company to make a swift promise to cover up to $300 of the price for patients who are facing the burden of higher out-of-pocket costs.

Mylan also launched its own generic version of the EpiPen in December and agreed a $465 million settlement over allegations that the product had not been properly classified with the Centers for Medicaid and Medicare Services as a non-innovator drug under the applicable definition in the Medicaid Rebate statute, and subject to the formula that is used to calculate rebates to Medicaid for such drugs.