A report released by Wells Fargo analyst David Maris suggests generic drug maker Mylan NV may become the next target of scrutiny for its drug-pricing tactics.
Maris’s report explained that the company committed to staggering price increases in 2016, according to Bloomberg. A generic drug for gastroesophageal reflux disease, metoclopramide, had its price raised by 444 percent while a therapy for irritable bowel syndrome, dicyclomine, had a 400 percent increase.
One of the pharmaceutical firm’s biggest products in the U.S., tolterodine, which treats overactive bladder, had its price raised 56 percent.
Maris noted, “the drugs for which Mylan raised prices considerably are a relatively small portion of its business,” added STAT.
However, the analyst said that the act of raising the costs of these drugs by huge margins is risky because it’s in an environment where the actions of Martin Shkreli, former CEO of Turing Pharmaceuticals, and Valeant Pharmaceuticals have made the issue of drug pricing part of the national conversation.
Maris elaborated saying that these maneuvers can come at a real cost to patients, shareholders and the company’s reputation.
But a spokesperson for Mylan, Nina Devlin, contends that this analysis is “flawed” along with being “self-serving and misleading to investors.”
A statement sent to CNBC by Devlin read in part, “”Mylan has always been known to have one of the industry’s broadest and most globally diversified business models and portfolios, which we have successfully managed by balancing numerous variables, including the natural price reductions that have always been inherent to the generics industry.”
Devlin countered that this research only focused on a small segment of Mylan’s 1,400 global products and 600 products sold in the U.S.
Mylan’s stock was down nearly 6 percent upon the release of the report, but rebounded by half during mid-day trading.
Filed Under: Drug Discovery
