Page 114 - Case Lab Case Analysis

In October 2016, Mylan announced a settlement with the DOJ over
rebates paid by Mylan to states under the Medicaid Drug Rebate

Program. Mylan agreed to pay a $465 million payment.

Also in October 2016, the Heather Bresch testified to a congressional

committee that Pfizer/King charged Mylan about $34.50 for one device.
Furthermore, Bresch said Mylan’s profit was $100 for a two-pack of the
injectors, despite a $608 list price.

This $100 profit figure appeared to be questionable and a few days later
the company admitted that it had substantially affected its calculation of
EpiPen profits by applying the statutory U.S. corporate tax rate of

37.5%- five times Mylan’s overall tax rate for 2015. Profit was probably
about 60% higher than that declared.

Lauren Kashtan a spokeswoman for

Mylan insisted the EpiPen is a complex
prescription product, with more than 15
critical component parts that must work
every time without fail in an emergency

situation, it’s not something that can be
made in a garage.

Bresch also maintained that the company
had spent hundreds of millions of dollars
improving the product since buying the

product from Merck in 2007. She also
blamed the complex US health care
system for the price. Members of

Congress however, required Bresch to
disclose her salary for the year 2015 -

$19m.