State Attorney General probing EpiPen maker, possible antitrust violations

Sep 7, 2016

The State Attorney General's office is investigating whether the manufacturer of EpiPens is violating antitrust laws in some of its contracts with school districts.

Credit WBFO News photo by Eileen Buckley

Mylan Pharmaceuticals has come under fire for raising the price of EpiPens to more than $600 per kit. EpiPens are the injectors which provide potentially life-saving medicine in the event of  a severe allergic reaction.

State Attorney General Eric Schneiderman announced Tuesday that his office is investigating whether EpiPen manufacturer Mylan Pharmaceuticals violated antitrust laws with possible anti-competition language in contracts with some school districts.
Credit WBFO file photo

Attorney General Eric Schneiderman is investigating whether Mylan inserted language into contracts with school districts that forbids them from shopping around for better deals and whether such language may violate antitrust laws.

The Buffalo School District recently reported that it had secured units at no cost for the school year. The concern, though, is for when the time comes to order more supplies. 

School Board member Hope Jay is eager to see how the probe unfolds. As she told WBFO, "where there's smoke, there's fire."

"I think the way Mylan has behaved, and the disservice to the public by the way they've gouged prices and of course for the children, is disgusting," Jay said. 

Jay acknowledged the school district's short-term security in terms of its stock but has not taken into consideration a price increase.

Former State Attorney General Dennis Vacco, now a partner with the law firm Lippes Mathias Wexler Friedman LLP, says the federal government, through the Food and Drug Administration, ultimately regulates drug manufacturers such as Mylan, but Schneiderman can go after the company's contracts. 

Should Schneiderman find any wrongdoing, Vacco expects he would then sue in a civil case.

"You're looking at the disgorgement of profits. You're looking at trebled damages. You can be looking at these contracts to be overturned or to be altered in some fashion," Vacco said. "There's a variety of remedies. But keep in mind that in an antitrust probe, I certainly suspect that this one is civil in nature, not criminal."