Mylan execs gave themselves huge raises as they hiked EpiPen prices
Mylan CEO Heather Bresch. AP photo
BY BEN POPKEN, NBC News
(NBC News) - EpiPen prices aren't the only thing to jump at Mylan. Executive salaries have also seen a stratospheric uptick.
Proxy filings show that from 2007 to 2015, Mylan CEO Heather Bresch's total compensation went from $2,453,456 to $18,931,068, a 671 percent increase. During the same period, the company raised EpiPen prices, with the average wholesale price going from $56.64 to $317.82, a 461 percent increase, according to data provided by Connecture.
In 2007 the company bought the rights to EpiPen, a device used to provide emergency epinephrine to stop a potentially fatal allergic reaction and began raising its price. In 2008 and 2009, Mylan raised the price by 5 percent. At the end of 2009 it tried out a 19 percent hike. The years 2010-2013 saw a succession of 10 percent price hikes.
And from the fourth quarter of 2013 to the second quarter of 2016, Mylan steadily raised EpiPen prices 15 percent every other quarter.
The stock price more than tripled, going from $13.29 in 2007 to a high of $47.59 in 2016.
And while sales of the life-saving drug rose to provide 40 percent of the company's operating profits in 2014, as Bloomberg reported, salaries for other Mylan executives also went up. In 2015, President Rajiv Malik's base pay increased 11.1 percent to $1 million, and Chief Commercial Officer Anthony Mauro saw his jump 13.6 percent to $625,000.
After Mylan acquired EpiPen the company also amped up its lobbying efforts. In 2008, its reported spending on lobbying went from $270,000 to $1.2 million, according to opensecrets.org.
Legislation that enhanced its bottom line followed, with the FDA changing its recommendations in 2010 that two EpiPens be sold in a package instead of one and that they be prescribed for at-risk patients, not just those with confirmed allergies. And in 2013 the government passed a law to give block grants to states that required they be stocked in public schools.
A spokeswoman for Mylan, the sole supplier of EpiPens, didn't respond to NBC News emails or voicemail seeking comment.
This isn't the first time the company's executives have been touched by a scandal.
A 2008 inquiry found Bresch didn't complete the coursework for her MBA granted by West Virginia University. The school had received a $20 million donation from Mylan chairman Milan Puskar in 2003.
Several of the university administrators resigned in the aftermath, including president Mike Garrison. The former Mylan consultant and lobbyist had gone to high school with Bresch, the daughter of West Virginia Senator Joe Manchin, and was a longtime family friend.
As NBC News previously reported, the sharp increases in price haven't escaped the attention of parents worried about paying for the drug in the back-to-school scramble, and Congress is starting to scrutinize Mylan's pricing.
On Monday, Senator Amy Klobuchar wrote a letter to the Federal Trade Commission, calling for a probe.
In a statement to NBC News, an FTC spokesman said, "The Commission takes seriously its obligation to take action where pharmaceutical companies have violated the antitrust laws, and it will continue to closely scrutinize drug market competition on consumers' behalf."
The pharmaceutical industry has seen steep increases in the past few years. Along with specialized drugs like ones for cystic fibrosis, decades-old generic prices have spiked. When one company, Turing Pharmaceuticals, raised the price of a drug used by HIV patients 5,000 percent overnight, the ensuing uproar pressured it to pledge lower its prices. Though, nearly a year later, a search on the drug-price comparison site GoodRx shows pharmacies are still selling it for the same amount or higher.
Among the usual advice for lower your prescription drug costs is to seek out a generic alternative. But because of the patent on the EpiPen delivery device, a true generic doesn't exist. Patients are instead buying abroad where the EpiPen is cheaper, and resorting to other devices that deliver epinephrine, including DIY syringes.
Shares of Mylan were down more than 4 percent in trading Tuesday as news of its troubles spread.