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Is EpiPen Price Gouging Going to Lead to Lawsuits?

December 14, 2016
Colson Hicks Eidson

There is much outrage over the increase in EpiPen pricing from the internet as well as from the patients that need the life-saving medication. The EpiPen device is used to stop life-threatening allergic reactions to common allergens such as bee stings, peanuts or other types of foods. The auto-injector device is stored in a convenient, small container and is injected into the patient’s thigh to stop a severe allergic reaction, such as anaphylaxis.

The EpiPen was less than $100 and was easily available to both families and schools with children who were susceptible to allergic reactions. However, Mylan Pharmaceutials Inc (MYL.O) acquired the auto-injector device in 2007 and hiked the price to more than $600 per EpiPen. This is why many parents, politicians and consumer groups are criticizing Mylan and accusing it of violating consumer protection laws.

Mylan Pharmaceuticals is Facing Lawsuits, Subpoenas and More

Now, a lawsuit was filed by an Ohio woman whose son has an allergy that requires an EpiPen. The complaint calls the “outrageous, unconscionable and immoral high prices” Mylan has set is “nothing more than price gouging.” The lawsuit goes on to say the price increases violate the Ohio Consumer Sales Practices Act, which includes taking advantage of a consumer’s physical infirmities, like medical conditions, and “unconscionable” acts in regards to consumer transactions, such as a drastic price hike. This lawsuit is anticipated to turn into a class action lawsuit.

A separate class action lawsuit was filed in Michigan accusing Mylan of gouging consumers by reducing the number of EpiPens sold in a pack to just two.

Additionally, a subpoena has been issued in West Virginia by the state’s Attorney General as part of an investigation into the pharmaceuticals company regarding Medicaid fraud and violation of antitrust measures.

Several U.S. senators are calling on the U.S. Federal Trade Commission to issue a subpoena into the company regarding its EpiPen pricing. That same day, the New York Attorney General announced the launch of his own investigation as to whether the company violated antitrust laws in providing EpiPens to schools.

According to Food Allergy Research and Education (FARE), more than 15 million people in the U.S. alone have food allergies. Mylan may be facing more individual lawsuits, class action lawsuits, subpoenas and anything else outraged consumers and politicians can throw at it (and rightfully so). The company executives should be ashamed of themselves for exploiting vulnerable people who may not be able to afford a life-saving $600 medical device.

After receiving pressure from lawmakers, the company is promising to create a generic brand for $300 and expand its discount programs. But is this enough? Do you think Mylan Pharmaceuticals will reduce the price back down to $100? Let us know what you think on our Facebook and Twitter pages!