Sunday, August 28, 2016

Mylan Defends EpiPen Price Hike

Why do smart people often do dumb things?  Would you plagiarize a speech that you know is going to be carefully scrutinized?   Would you respond to a robocall that congratulates you on winning a free cruise?  Would you keep eating sushi that didn’t smell right? 

I’m certainly not judging anyone here.  I’ve had plenty of my own misadventures and I periodically add to the list. 

Our presidential candidates fall prey to human error and misjudgments surprisingly often.  Aren’t these folks supposed to be pros or at least managed by honed handlers?  Why would Donald Trump have insulted nearly every constituency and rival during the primary election process knowing that this might render him unelectable in the general election?  Why would Hillary Clinton demand unconscionable speaking fees from special interest groups when she knew that she would pursue the presidency and her payoffs would be publicized?

I’ll leave it to readers to ponder their own responses to the above inquiries.

If the sushi doesn't pass the sniff test, head to Burger King.

Last year, I posted on a drug company that raised the price of a pill from $13.50 to $750.00.  Even if such a practice is legal, or is justified by market forces, it is very, very dumb.  It is guaranteed to provoke outrage and will surely result in scrutiny that will go much wider and deeper than the initial offense.  It did.  For more details, just click here.

One would think that rival pharmaceutical companies would be more cautious before enacting similar price gouging.   Guess again.  Mylan, who makes EpiPen, raised the price of this product about 500% over the past years, bringing the price to $608 for a two pack.   The company stands by the new pricing.  Sure, they have offered a few discount coupons, but they are leading from way behind. They are not likely to prevail, even if they have a potent economic argument.  

This stuff is ripe grist for politicians, who can rail against the pharmaceutical barons, in order to distract the public from their own abysmal performance.  And, angry parents will use social media and other methods to publicize their outrage.  The fact that many patients who rely upon EpiPens are young children doesn’t make the company’s case any easier.  

If Mylan’s CEO Heather Bresch is called to testify, how will the optics be when she states that her compensation last year was about $19 million?

Why are so many pharmaceutical folks so allergic to good judgment?  Perhaps, they should carry around an EpiPen, if they can afford it.

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