CMS warned Mylan about EpiPen rebate issues multiple times

Despite repeated warnings from CMS about the misclassification of EpiPens, Mylan still fails to pay the agency millions of dollars in rebates from EpiPen sales, reported CNBC.

Canonsburg, Pa.-based Mylan classified the life-saving device as a generic product and therefore pays a 13 percent rebate for every EpiPen it sells under the Medicaid rebate program.

Since the device was approved by the FDA under a "New Drug Application," it is patent protected and has no FDA-recognized therapeutics equivalents. CMS said Mylan should instead pay the 23.1 percent rebate rate intended for branded drugs, along with a inflation rebate legally required when a drug company raises the price of a brand-name product above the inflation rate, according to the report.

"CMS has, on multiple occasions, provided guidance to the industry and Mylan on the proper classification of drugs, and has expressly advised Mylan that their classification of EpiPen for the purposes of the Medicaid Drug Rebate Program was incorrect," said Aaron Albright, a spokesman for CMS."This incorrect classification has financial consequences for the amount that federal and state governments spend by reducing the amount of quarterly rebates Mylan owes for EpiPen."

CMS declined to say what actions it would take to "correct this misclassification," according to the report.


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