For all intents and purposes, California Governor Jerry Brown held his nose Friday as he signed a bill that allows state agencies and businesses to keep EpiPen devices on hand for emergencies.
While Brown readily acknowledged that EpiPen is a lifesaver for people with allergic reactions, he simultaneously issued two letters — one to the California State Assembly and the other to US Senate and House leaders — to complain about “predatory pricing” by the manufacturer, Mylan Pharmaceuticals.
“I cannot take this action without registering my strong objection to the bill sponsor’s recently reported pricing maneuvers,” he wrote in one of the letters in which he referred to a successful lobbying campaign by Mylan to urge states to make EpiPen widely available.
He noted that, even as Mylan sponsored such bills, the company was raising the price for a two-pack of EpiPen. It now costs $608, a 548 percent jump over the past decade. “State government cannot stop unconscionable price increases, but it can shed light on such rapacious corporate behavior,” he wrote.
Brown also made a point of writing that Mylan raised the total compensation for its Chief Executive, Heather Bresch, to nearly $19 million, a 600 percent increase, during the same period of time.
His remarks mirror the coast-to-coast outrage over EpiPen pricing, which has become the latest symbol of anger over pharmaceutical pricing. The issue has become so heated the cost of medicines is now a regular talking point in the presidential campaign.
As for Mylan, several congressional lawmakers are investigating its pricing and some are urging the US Federal Trade Commission to conduct an antitrust probe. Bresch, in fact, is scheduled to testify on Wednesday before the US House Committee on Oversight and Government Reform.
The EpiPen episode, however, is symptomatic of a larger and more complicated debate — trying to balance a need for affordable medicines with the pricing that the pharmaceutical industry argues is required to underwrite further innovation.
For the moment, drug makers appear to be losing the debate. Many companies have charged that Mylan and others — notably, Valeant Pharmaceuticals and Turing Pharmaceuticals, which was run by Martin Shkreli — are outliers that simply buy old drugs and jack up prices to sky-high levels.
But the argument has largely fallen on deaf ears as data regularly emerges showing how the largest brand-name drug makers have often raised prices by double-digit amounts on a fairly consistent basis, moves that undermine their contention.
A recent survey of about 3,000 brand-name prescription drugs found that prices more than doubled for 60 medicines and at least quadrupled for 20 others since December 2014, according to DRX, a market research firm that ran the numbers for Bloomberg News.
In response to the controversy, a bipartisan group of lawmakers last week introduced a bill that would require drug makers to justify their pricing and provide a breakdown of their costs before raising prices on certain products by more than 10 percent.
The goal of the legislation, which is essentially identical to bills that have been introduced in more than a dozen states over the past year, is to gain some transparency into industry pricing and, presumably, force companies to take more modest price hikes.
The bill was proposed just days after Allergan Chief Executive Brent Saunders issued a manifesto in which he promised his company would hold price hikes to single-digit percentage increases, in most cases, and take other steps to blunt rising costs. So far, no other company has agreed to follow suit.