Mylan's underpayments to CMS in EpiPen rebate scandal likely exceed settlement amount, study finds

Mylan's $465 million proposed settlement with CMS may not cover the amount of money it allegedly saved by improperly classifying EpiPens as a generic drug, according to research published Monday in JAMA Internal Medicine.

Here are five things to know.

1. CMS repeatedly warned Mylan that it was underpaying rebates to state Medicaid programs by classifying EpiPens as a generic product rather than a branded one. With a generic classification, Mylan only pays a 13 percent rebate for every EpiPen sold under the rebate program compared to 23.1 percent for branded drugs.

2. While CMS did not disclose how much it overpaid for the EpiPens, recent figures show federal health plans spent more than $1 billion on EpiPens from 2011 to 2015.

3. In October, Mylan reached a $465 million settlement with the federal government for the alleged overcharging. Mylan said the settlement, which is still not finalized, did not imply an admission of guilt, reports Reuters.

4. For the study, researchers assessed expenditure and volume data for EpiPens through the Medicaid Drug Utilization database. They found Mylan avoided paying more than $426 million in rebates from 2012 to 2016 by classifying EpiPens as a generic drug.

5. Researchers note this amount may exceed the $465 million settlement as their estimate only covers two types of EpiPens for a your-year period. Mylan has owned the rights to EpiPen since 2007 and the drug has been classified as a generic since 1997, according to CMS.

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