Viatris, the drugmaker previously known as Mylan, announced on Monday that it had agreed to pay $264 million to settle a class-action lawsuit that alleged the company was involved in an illegal scheme to monopolize the market for epinephrine auto-injector devices known as EpiPens, which are used to treat severe allergic reactions.
The proposed settlement, which needs to be approved by a judge, would resolve a legal battle that began after Mylan, in 2016, raised the price for a pack of two EpiPens to $608 from $100, the price since 2007, according to court documents.
In the lawsuit, a group of plaintiffs made up of consumers, health insurance companies and other third-party payers alleged that by drastically raising the price of EpiPens, the drugmaker was “unlawfully exercising its monopoly power,” according to a complaint.
“Were the price increases attributable to market conditions, increases in manufacturing costs or shortages in the supply of epinephrine?” the complaint said. “Absolutely not. They were driven solely by unaccountable executives and companies who sought to profit off of human misery and fear.”
Many people involved in the lawsuit had paid thousands of dollars for EpiPens over the years, including a mother from Arizona who had paid $2,475 out of pocket for her son who is allergic to tree nuts and peanuts, and a father from Delaware who spent more than $1,100 on EpiPens for his son who is allergic to milk, eggs and peanuts, according to the lawsuit.
EpiPens are made by two subsidiaries of Pfizer — King Pharmaceuticals and Meridian Medical Technologies — and are sold by Viatris.
In July, Pfizer and its subsidiaries settled its part of the lawsuit for $345 million, and denied any wrongdoing.
In its quarterly earnings report on Monday, Viatris said that the company “maintains that it acted lawfully and pro-competitively and the settlement contains no admission of liability.”
“The board of directors believes that this settlement is in the best interests of the company and its stakeholders,” the report said. “The resolution of these indirect purchaser cases will allow the company to move forward and continue focusing on its strategic priorities and its mission of empowering people worldwide to live healthier at every stage of life.”
Neither Viatris officials nor lawyers representing the company immediately responded to a request for comment on Monday night.
Feb. 28, 2022, 4:58 p.m. ET
Lynn Sarko, a lawyer representing the plaintiffs, said in a statement that he urged consumers and third-party payers who paid for EpiPens to learn more about the settlement at a website where claims can be filed.
“We are pleased that the EpiPen antitrust litigation is now concluded,” Paul Geller, another lawyer representing the plaintiffs, said in a statement, adding that the settlement is subject to court approval.
The lawsuit also alleged that the drugmaker misclassified EpiPens under the Medicaid Drug Rebate Program to save hundreds of millions of dollars in rebates, and that it intervened in regulatory proceedings to delay competitors from entering the market.
The price jump in 2016 drew widespread outrage, especially among parents of children with allergies. Thousands of people signed a petition urging Congress to intervene.
After protests over the company’s raising the price of EpiPens in 2016, Mylan, as Viatris was then known, introduced a generic version of its own product. But it was announced with a wholesale list price of $300 for a pack of two, half the price of the brand-name EpiPen.
In 2016, Mylan reached a $465 million settlement with the Justice Department and other government agencies over allegations that the drugmaker had overcharged Medicaid for the treatment by improperly classifying it as a generic drug.