Sen. Richard Blumenthal (D-Conn.) called on the Justice Department to reject a settlement that it reached earlier this month with Mylan, over accusations that the federal government is one of many customers that the pharmaceutical giant ripped off.
Blumenthal said that the $465 million deal was “far less than $700 million in harm” estimated to have been done to public finances, after Mylan jacked up the price of the Epipen.
Outrage spread over the hikes in August, in the wake of media reports about the increased cost to schools of the commonly-used lifesaving devices.
“This proposed settlement has been reached—inexplicably–without knowing this exact profit Mylan made through these overcharges and requiring Mylan to pay at least that amount in fines and restitution,” Blumenthal said. He made the remarks in an Oct 14. letter to Attorney General Loretta that was released to the public on Monday.
Used to treat severe allergic reactions, Epipens increased in price by 500 percent, between 2009 and last summer. In 2007, before Mylan purchased the rights to manufacture the devices, Epipens cost $57. A two-pack ran for more than $600 last summer, in major retail markets.
Claims about Mylan overcharging Medicaid soon followed the outcry over this trend.
In late August, Sens. Blumenthal, Chuck Grassley (R-Iowa) and Amy Klobuchar (D-Minn.) asked the Justice Department to look into the matter, questioning if Mylan mischaracterized the Epipen as a generic drug. The move would have allowed the company to illegally collect more money from state and federal governments via Medicaid rebate programs.
While Mylan settled these claims with the Justice Department, in a deal announced on Oct. 7, the company admitted no wrongdoing.
“Unfortunately, by ending this investigation now, DOJ may forgo an effective investigation regarding the facts and scope of criminal wrongdoing,” Blumenthal lamented in his letter.
The case has personal intrigue for some of Blumenthal’s colleagues in the Senate. Klobuchar has child who suffers from severe allergies and relies on the Epipen as a result. Mylan CEO Heather Bresch, meanwhile, is the daughter of Sen. Joe Manchin (D-W.Va.).
