By HOLMAN W. JENKINS, JR.
Aug. 26, 2016 5:36 p.m. ET

To whom it may concern:

As the CEO of Mylan, maker of the world-famous EpiPen, it gives me great pleasure to address you, via email from an undisclosed location, concerning the pricing of our product.

As you may know, my father is a U.S. senator from West Virginia, where the state motto is “Montani semper liberi.� It means “mountaineers are always free.� Indeed, they are. But pharmaceuticals aren’t—especially EpiPen.

Sadly, thanks to a controversy fanned by the media, even my father, better known as Sen. Joe Manchin, issued a statement this week decrying the “skyrocketing prices of prescription drugs.� He didn’t mention EpiPen for good reason. He’s my dad.

Our health-care system is confusing. The public is understandably confused about why we have raised the price of a two-pack of EpiPens by 500% over the past decade—from $100 in 2007 to $600 today.

That sounds like a lot, especially since the active ingredient, epinephrine, has been around since 1901 and is cheap to make. Yes, we recently improved our injector, but guess what? The old injector worked fine. EpiPen, using the old injector, saved thousands of lives, especially children who are allergic to peanuts or bee stings.

The drug can be bought for 10 cents in many countries; the old injector design our would-be competitors are free to copy to their heart’s content. Our prices would surely be lower, then, if we actually had some competitors. Don’t blame me. The Food and Drug Administration has delayed the entry of one competitor and made noises that recently drove another from the market over product-quality snafus.

As I explained to the New York Times this week, “I am a for-profit business.� EpiPen sales have reached $1 billion a year on my watch, up from $200 million a decade ago. Guess how much of that growth is not increased volume but increased profit? A lot. That’s capitalism. I’m doing my job. Maybe the FDA should do theirs.*

(*Mylan employs lobbyists and lawyers to delay competitors from getting their products approved by the FDA.)

Newspaper and TV coverage of our pricing controversy has not been friendly to Mylan, but most reports at least mention the ways we strive to lower the out-of-pocket price for consumers with coupons and rebates to offset their copays and deductibles. We also provide free drugs to hardship cases. The Washington Post even alluded to these efforts in its headline: “Despite coupons, EpiPen’s virtual monopoly roils critics.�

Sadly, the media have proved unable to explain the finer points of pharmaceutical pricing. Not that we blame the media: health-care pricing is complicated and subject to Reporter Complexity Refusal Syndrome.

And yet the essential matter is not complicated. It can be explained in a sentence: Six hundred dollars is the price we want insurers to pay.

Insurers are not spending your money. They are spending everybody’s money. Look at it from the perspective of health-care providers, drugmakers or medical-device suppliers. All of us are competing for a common pot of loot. Naturally, each wants to maximize his share. That’s human nature. If 10 hungry people are sitting around a small bowl of jelly beans, each will eat more, and faster, than he otherwise would.

Notice something else: How much each provider takes out of the common pot has no natural, organic relationship to the value the provider brings to the patient. Why not? Well, in the rest of the economy, when a consumer is spending out of his pocket, he has incentive to judge whether the service he’s buying is worth the price he’s being asked to pay.

Now you know why we offer coupons and rebates to individual consumers. This is our way of trying to re-desensitize customers to the price of EpiPen in order to counter the efforts of insurers to re-sensitize them by hitting them with copays and deductibles.

Then why does getting our coupons and rebates involve rigmarole? Because certain consumers won’t make the effort, and then we get to keep the money that would otherwise go to defray their out-of-pocket costs.

It’s a great game and we have fun playing it. On average, however, it probably does not increase the health-care industry’s profit margins or the public’s health—but only the share of national income diverted to health care from everything else: beer nuts, wedding presents, automobiles. Our industry’s share of GDP is 17%, up from 13% two decades ago. Hooray, that’s $700 billion a year.

For decades, health-care reform as preached by knowledgeable experts has aimed at fixing this dynamic, and yet every law passed by Congress ends up doing the opposite, basically using taxpayer money to fill the pot with more jelly beans for providers to fight over.

So if you don’t like how much your EpiPen costs, elect different politicians (except for dad).

Sincerely,

Heather Bresch

Chief Executive Officer, Mylan

Actually I hope this inspires competition.

On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."

One of my neighbors is diabetic and earlier this week when the Epipen
scandal broke, he mentioned that two insulin products he has used,
Novolog something or other and Humalog something or other, from two
competing manufacturers, had "list prices" of around $1100 for a one
month supply. He pays less because of his insurance, but he still pays a
lot. No competition in price. It's the American way for many products.
Competition is not the answer.

I doubt the Epipens cost more than $2 or $3 to manufacture, including
the drug and the injector. I read a report that in Canada, a Canadian in
need of an Epipen pays about $12.

On Sunday, August 28, 2016 at 7:33:15 AM UTC-5, Keyser Soze wrote:
On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."


Exactly. the more the "competition" the better the pricing. Yes "free market" is part of the "American dream"

On Sun, 28 Aug 2016 08:33:11 -0400, Keyser Soze
wrote:

On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."

One of my neighbors is diabetic and earlier this week when the Epipen
scandal broke, he mentioned that two insulin products he has used,
Novolog something or other and Humalog something or other, from two
competing manufacturers, had "list prices" of around $1100 for a one
month supply. He pays less because of his insurance, but he still pays a
lot. No competition in price. It's the American way for many products.
Competition is not the answer.

I doubt the Epipens cost more than $2 or $3 to manufacture, including
the drug and the injector. I read a report that in Canada, a Canadian in
need of an Epipen pays about $12.


Yeah those price gouging democrats.
This is not the "free market" it is a government imposed monopoly.
There are competitors out there but they are hung up in the FDA
process, something the Canadians are not burdened with in Canada where
there are other products on the market.

On 8/28/16 10:28 AM, wrote:
On Sun, 28 Aug 2016 08:33:11 -0400, Keyser Soze
wrote:

On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."

One of my neighbors is diabetic and earlier this week when the Epipen
scandal broke, he mentioned that two insulin products he has used,
Novolog something or other and Humalog something or other, from two
competing manufacturers, had "list prices" of around $1100 for a one
month supply. He pays less because of his insurance, but he still pays a
lot. No competition in price. It's the American way for many products.
Competition is not the answer.

I doubt the Epipens cost more than $2 or $3 to manufacture, including
the drug and the injector. I read a report that in Canada, a Canadian in
need of an Epipen pays about $12.


Yeah those price gouging democrats.
This is not the "free market" it is a government imposed monopoly.
There are competitors out there but they are hung up in the FDA
process, something the Canadians are not burdened with in Canada where
there are other products on the market.



So, the libertarian approach is...thalidomide?

On 8/28/16 10:29 AM, wrote:
On Sun, 28 Aug 2016 09:21:40 -0400 (EDT), Keyser Soze
wrote:

Tim Wrote in message:
On Sunday, August 28, 2016 at 7:33:15 AM UTC-5, Keyser Soze wrote:
On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."


Exactly. the more the "competition" the better the pricing. Yes "free market" is part of the "American dream"


Ahhh. Sorta like that GOP b.s. about trickle down economics...

Only a democrat would believe a government imposed monopoly is the way
to go. I bet you think Comcast is good too.



There's no monopoly in the insulin drugs I previously mentioned, yet
both competitors charge the same outrageous price for their
products...and there have been numerous news articles discussing
collusion in the pharma industry to avoid "competitiveness." In many
market segments, even though there are competitors, there is no
competition.

On Sun, 28 Aug 2016 10:30:10 -0400, Keyser Soze
wrote:

So, the libertarian approach is...thalidomide?

===

Is thalidomide what stunted your personal development?

Keyser Soze wrote:
On 8/28/16 10:29 AM, wrote:
On Sun, 28 Aug 2016 09:21:40 -0400 (EDT), Keyser Soze
wrote:

Tim Wrote in message:
On Sunday, August 28, 2016 at 7:33:15 AM UTC-5, Keyser Soze wrote:
On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."


Exactly. the more the "competition" the better the pricing. Yes "free
market" is part of the "American dream"


Ahhh. Sorta like that GOP b.s. about trickle down economics...

Only a democrat would believe a government imposed monopoly is the way
to go. I bet you think Comcast is good too.



There's no monopoly in the insulin drugs I previously mentioned, yet
both competitors charge the same outrageous price for their
products...and there have been numerous news articles discussing
collusion in the pharma industry to avoid "competitiveness." In many
market segments, even though there are competitors, there is no
competition.


How come a mostly Democrat controlled presidency has not fixed that in the
last 2 years? Maybe because they are controlled by Wall Street?

Keyser Soze wrote:
On 8/28/16 10:28 AM, wrote:
On Sun, 28 Aug 2016 08:33:11 -0400, Keyser Soze
wrote:

On 8/27/16 9:52 PM, Tim wrote:
Actually I hope this inspires competition.



Ahhh...that old American dream...the "free market" and "competition."

One of my neighbors is diabetic and earlier this week when the Epipen
scandal broke, he mentioned that two insulin products he has used,
Novolog something or other and Humalog something or other, from two
competing manufacturers, had "list prices" of around $1100 for a one
month supply. He pays less because of his insurance, but he still pays a
lot. No competition in price. It's the American way for many products.
Competition is not the answer.

I doubt the Epipens cost more than $2 or $3 to manufacture, including
the drug and the injector. I read a report that in Canada, a Canadian in
need of an Epipen pays about $12.


Yeah those price gouging democrats.
This is not the "free market" it is a government imposed monopoly.
There are competitors out there but they are hung up in the FDA
process, something the Canadians are not burdened with in Canada where
there are other products on the market.



So, the libertarian approach is...thalidomide?


Thalidomide is still being used. Is Thalmud (sp) used for cancer
treatment. But FDA approved thalidomide for pregnant women. Government
screws up also. But Epipen competitors have been locked out. Maybe the
fact the CEO is the daughter of a Senator with a $16,000,000 raise has
something to do with government imposed monopoly?