Savings from the EpiPen Authorized Generic: a Retrospective Analysis of Medicaid Data
Authorized generics—generic drugs that are simply relabeled versions of the original brand-name drug—are a mechanism by which manufacturers can voluntarily lower drug prices. Although evidence from the early 2000s suggests that authorized generics lower prices in the presence of other independent generics,1 the impact of authorized generics in markets with limited competition remains unknown.
In the midst of a debate on prices of epinephrine auto-injectors, Mylan introduced an authorized generic of EpiPen in 2016. We used this case to evaluate how the entry of an authorized generic affects pricing, utilization, and spending in the presence of limited competition. We focused on its financial impact on Medicaid due to the availability of nationwide data and the regulation of rebates.
Using Medicaid state drug utilization data,2we extracted reimbursement records for all epinephrine auto-injectors (including junior formulations) from Q1 2014 to Q1 2018. We...
Hernandez is funded by the National Heart, Lung and Blood Institute (grant number K01HL142847). There are no other sources of funding for this manuscript.
Compliance with Ethical Standards
Conflict of Interest
Inmaculada Hernandez has received consultancy fees from Pfizer. Chester Good is a current employee of the Insurance Services Division, University of Pittsburgh Medical Center. William Shrank was an employee of the Insurance Services Division, University of Pittsburgh Medical Center, at the time of the study and he has accepted employment at Humana, but has not started yet. The remaining authors declare that they do not have a conflict of interest.
- 2.Medicaid State Drug Utilization Data. https://data.medicaid.gov/browse?category=State+Drug+Utilization&limitTo=datasets. Accessed 5 March 2019.
- 3.Medicaid Drug Rebate Program. https://www.medicaid.gov/medicaid/prescription-drugs/medicaid-drug-rebate-program/index.html. Accessed 5 March 2019.
- 4.CVS Health Offers Patients Lowest Cash Price in the Market for Generic Epinephrine Auto-injector to Treat Allergic Reactions. 2017; https://cvshealth.com/newsroom/press-releases/cvs-health-offers-patients-lowest-cash-price-market-generic-epinephrine-auto. Accessed 5 March 2019.
- 5.US Department of Justice. Office of Public Affairs. Mylan Agrees to Pay $465 Million to Resolve False Claims Act Liability for Underpaying EpiPen Rebates. https://www.justice.gov/opa/pr/mylan-agrees-pay-465-million-resolve-false-claims-act-liability-underpaying-epipen-rebates. Accessed 5 March 2019.