As the heat comes on Mylan N.V. (NASDAQ:MYL) while no attention is paid to crushing healthcare costs and soaring drug prices – the not too innocent but sacrificial lamb of the health industry is announcing some changes to its Epipen in a press release this morning. Shares are up 1.15 percent at the time of this writing on the announcement but is it a game-changer for those who desperately need the product but are not super rich or super poor and on Medicaid which has zero copays (at least in New York state) and therefore cannot afford (despite the implementation of the AFFORDABLE Healthcare Act) many years ago?

Evercore ISI opines

Mylan’s announcement this morning (launching a generic Epipen) reads like a bold move. Certainly good for PR.
3 questions off the back: (I have not heard back from Mylan yet)
– Is this a cash-pay generic that will only be available via direct ship program?
– Will the generic be constrained on supply?
– What is the NET price realized by Mylan on generic vs brand? Is there a meaningful difference?
There are 2 scenarios that may alienate PBMs / supply chain:
– Generic epipen only available as cash pay
– If the NET price realized by Mylan isn’t too different than what Mylan was already getting on brand, that simply means that PBMs etc. will get much less discounts/rebates. This may not sit well with PBMs etc.

Evercore-ISI-epipen-mylan

Analysts at Bernstein agree opining:

The two steps taking by Mylan to reduce the cost of Epipen will have material impact on the consumer cost of the drug. They are also quite costly for the company – we suspect the average revenue/script will be reduced to something like $280/TRx, or 25% less revenue ($300 being top cost, some pay less than that).

See the full press release below and tell us what you think.

Mylan To Launch First Generic To Epipen® Auto-injector At A List Price Of $300 Per Two-pack Carton, A More Than 50% Discount To The Brand Product

HERTFORDSHIRE, England and PITTSBURGH, Aug. 29, 2016 /PRNewswire/ — Mylan N.V. (NASDAQ, TASE: MYL) today announced that its U.S. subsidiary will launch the first generic to EpiPen® Auto-Injector (epinephrine injection, USP) at a list price of $300 per generic EpiPen® two-pack carton, which represents a discount of more than 50% to the Mylan list price, or wholesale acquisition cost (“WAC”), of the branded medicine. The authorized generic will be identical to the branded product, including device functionality and drug formulation. Mylan expects to launch the product in several weeks, pending completion of labeling revisions. Upon launch, the product will be available as a two-pack carton in both 0.15 mg and 0.30 mg strengths. Mylan also intends to continue to market and distribute branded EpiPen®.

Mylan Epipen Auto-injector
Image source: Wikimedia Commons
Mylan’s Epipen

Mylan CEO Heather Bresch commented, “We understand the deep frustration and concerns associated with the cost of EpiPen® to the patient, and have always shared the public’s desire to ensure that this important product be accessible to anyone who needs it. Our decision to launch a generic alternative to EpiPen® is an extraordinary commercial response, which required the cooperation of our partner. However, because of the complexity and opaqueness of today’s branded pharmaceutical supply chain and the increased shifting of costs to patients as a result of high deductible health plans, we determined that bypassing the brand system in this case and offering an additional alternative was the best option. Generic drugs have a long, proven track record of delivering significant savings to both patients and the overall healthcare system. The launch of a generic EpiPen®, which follows the steps we took last week on the brand to immediately reduce patients’ out-of-pocket costs, will offer a long-term solution to further reduce costs and ease the burden and complexity of the process on the patient.”

Bresch continued, “Ensuring access to medicine is absolutely the core of Mylan’s mission and has been since our founding 55 years ago. Mylan currently markets approximately 600 products in the U.S., saving our healthcare system hundreds of millions of dollars annually. We also are committed partners to the allergy community and take our responsibilities to serving these patients very seriously. Today’s action further demonstrates this commitment.”

To enhance affordability for the broadest patient population possible, both the augmented patient assistance program and the $300 savings card announced last week will remain in place for the brand product. The $300 My EpiPen Savings Card® acts as cash at the pharmacy and is available at epipen.com/savings. People interested in learning more about the patient assistance program should contact Mylan’s Customer Relations team at 800-395-3376. Mylan also will continue its EpiPen4Schools® program.

In addition, Mylan intends to initiate a direct ship program in conjunction with the launch of the generic at the $300 generic list price. Mylan also continues to fight for enhanced access to epinephrine auto-injectors through other measures, such as inclusion of the product on the federal and private insurance preventive drug lists, which could potentially eliminate all co-pays.

Importantly, Mylan remains fully committed to continuing to meet the needs of this under-served patient population. This includes investing in education and awareness about anaphylaxis, a life-threatening allergic reaction. These efforts have proven vital to ensuring patients are aware of their risk, prepared in the event anaphylaxis occurs, and have access to epinephrine auto-injectors whenever and wherever they need them, at an affordable cost.

About EpiPen® (epinephrine injection, USP) Auto-Injector

EpiPen® (epinephrine injection, USP) and EpiPen Jr® (epinephrine injection, USP) Auto-Injectors are used for the emergency treatment of life-threatening allergic reactions. Each EpiPen 2-Pak® and EpiPen Jr 2-Pak® contains two single auto-injectors, instructions for use and a training device, with no drug product or needle, to help patients become familiar with the administration technique. EpiPen® Auto-Injector should be administered immediately at the first sign of an anaphylactic reaction. EpiPen® Auto-Injector is not a substitute for emergency medical treatment. Patients should seek emergency medical attention immediately following administration. For more information about EpiPen® Auto-Injector, visit epipen.com.