Mylan: EpiPen Auto-Injector to be classified as 'innovator drug' on April 1
Mylan said the following in a regulatory filing: Item 2.02 of this report is incorporated by reference into this Item 7.01. The press release also announced that Mylan had agreed to the terms of a $465M settlement with the U.S. Department of Justice and other government agencies that will resolve questions that have been raised about the classification of the EpiPen Auto-Injector and EpiPen Jr Auto-Injector for purposes of the Medicaid Drug Rebate Program.The terms of the settlement do not provide for any finding of wrongdoing on the part of Mylan or any of its affiliated entities or personnel. The question in the underlying matter was whether EpiPen Auto-Injector was properly classified with the Centers for Medicaid and Medicare Services as a non-innovator drug under the applicable definition in the Medicaid Rebate statute and subject to the formula that is used to calculate rebates to Medicaid for such drugs. EpiPen Auto-Injector has been classified with CMS as a non-innovator drug since before Mylan acquired the product in 2007 based on longstanding written guidance from the federal government. The settlement terms provide for resolution of all potential rebate liability claims by federal and state governments as to whether the product should have been classified as an innovator drug for CMS purposes, and subject to a higher rebate formula. Consistent with the recent CMS rule regarding the classification of drugs for rebate purposes, EpiPen Auto-Injector will begin being classified as an innovator drug on April 1, 2017. In connection with the settlement, Mylan expects to enter into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services. Mylan will continue to work with the government to finalize the settlement. Also on October 7, Mylan received a document request from the Division of Enforcement at the Securities and Exchange Commission seeking communications with the CMS and documents concerning Mylan products sold and related to the Medicaid Drug Rebate Program, and any related complaints. Mylan intends to fully cooperate with the SEC's investigation.