Mylan N.V. (NASDAQ:MYL) has agreed to settle its EpiPen probe by paying $465 million.
The company will be paying the sum after being accused of overcharging customers for its anti-allergy medication EpiPen. Prices increased by about 400% between 2010 and 2016, according to federal investigators.
Mylan misclassified EpiPen as being a generic rather than a brand-name product in order to avoid paying rebates to Medicaid. “Mylan misclassified its brand name drug, EpiPen, to profit at the expense of the Medicaid program,” said William Weinreb, the acting U.S. Attorney for the District of Massachusetts.
The settlement’s size was unveiled last October, and it helps to resolve all Medicaid rebate liability claims issued by the federal government in addition to claims by a number of hospitals. The money will be used to bring funds to Medicaid programs in all 50 states.
CEO Heather Bresch did not admit to any wrongdoing, saying that the settlement will help bring closure to this chapter in the company’s history, and it is the responsible thing to do for the company and its shareholders.
The EpiPen price rose to as much as $600, but Mylan has responded by launching a generic version of the medication for $300. Some members of Congress believe the settlement amount is too small.
An analysis by the U.S. Department of Health and Human Services’ Office of Inspector General found that the government may have overpaid for EpiPens by up to $1.27 billion between 2006 and 2016.
MYL stock surged 0.6% Thursday.
