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April 25, 2017 01:00 AM

Sanofi sues Mylan over epinephrine injector market monopoly

Alex Kacik
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    Sanofi accused a rival, EpiPen manufacturer Mylan, in a lawsuit on Monday of offering illegal rebates to third-party payers that squeezed out the competition for epinephrine auto-injectors.

    Mylan allegedly gave insurance companies, pharmaceutical benefit managers and state-based Medicaid agencies "unprecedented" rebates on the condition that those payers would not provide reimbursements for Sanofi's epinephrine injector Auvi-Q, according to the lawsuit filed in New Jersey federal court.

    That policy and other alleged Mylan practices cut Auvi-Q's U.S. market share by nearly half from 13% in 2013 to 7% in 2014, just a year after Sanofi launched the injector. Sanofi is seeking hundreds of millions of dollars in damages stemming from lost sales due to Mylan's alleged misconduct, the complaint said.

    "To preserve the monopoly position of their $1 billion crown jewel branded drug product, Mylan engaged in illegal conduct to squelch this nascent competition, harming both Sanofi and U.S. consumers," the complaint said.

    Mylan did not return requests for comment.

    The lawsuit is the latest development in the fallout from the soaring price of EpiPens, which are used in emergencies to stop severe allergy attacks. The injectors' list price now tops $600, an increase of more than 500% since 2007, when Canonsburg, Pa.-based Mylan bought rights to the drug.

    In addition to the alleged rebate agreements, Mylan would provide discounted EpiPens to schools only if they would use EpiPen exclusively, Sanofi claimed. Mylan also improperly identified EpiPen's Medicaid rebate classification, allowing it to subsidize its deep conditional rebates to third-party payers, the lawsuit said.

    Mylan agreed to pay the U.S. Justice Department $465 million last year to settle allegations that it overbilled Medicaid. A recent study published by JAMA said the settlement should have been higher. The total rebate amount would have been at least $528 million if Mylan correctly classified the EpiPen products, researchers said.

    Mylan is also facing a U.S. antitrust investigation over potentially thwarting competition, as well as an investigation from the New York attorney general into the company's contracts with schools.

    The Sanofi lawsuit is one of a series of suits accusing the EpiPen developer of various illegitimate practices that resulted in a drastic surge in prices and its dominant market share. Earlier this month, three EpiPen users filed a lawsuit claiming Mylan engaged in a racketeering sales scheme that inflated EpiPen's price.

    They alleged that Mylan's agreements with pharmacy benefit managers amounted to illegal kickbacks. The plaintiffs claim that Mylan paid PBMs—including Express Scripts, CVS Health and OptumRx—to promote EpiPen over competitor allergy injectors, and those payments artificially increased prices.

    In January, insurer Cigna Corp. announced that it would not cover Mylan's EpiPen and instead would favor Mylan's $300 generic version of the injector.

    Since the EpiPen fallout, some PBMs such as CVS Health carry generic EpiPen alternative Andrenaclick, which is made by Impax Laboratories.

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