Amid EpiPen price woes, alternatives emerge -- but at a questionable cost
More choices are available for millions of people who rely on the EpiPen for life-threatening allergies, but there's still confusion over the cost of the treatments.
We reported last August how the EpiPen's price soared more than 480 percent over seven years to more than $600. It had a virtual monopoly and accounted for 94 percent of epinephrine auto-injectors. Just 26 percent of prescriptions filled today are for the brand name EpiPen, and 48 percent are for Mylan's authorized generic version. Other companies now claim 26 percent of the market.
Things have changed in the year since we first visited the Henegar household in the suburbs of Indianapolis, reports CBS News correspondent Anna Werner. Two of the six children in the family have severe allergies, and last year at this time, parents Justin and Lexi were unhappy about the prices for their EpiPens: $600 for a two-pack.
Under increased pressure from patients and lawmakers, Mylan was forced to explain the price hikes.
"Do you think you were charging too much at $600?" Rep. Scott DesJarlais, R-Tenn., asked Mylan CEO Heather Bresch at a September 2016 Congressional hearing.
"Sir, the – we believe it was a fair price. And we've just now lowered that price by half," Bresch responded.
They launched a generic version for $300 and boosted a coupon program to cut patients' costs. CVS pharmacy then offered a different generic injector for $109. This past June, the Henegars got a letter from their insurer.
"They are no longer going to be covering the EpiPens. They will only cover the generic version. So they have taken these completely off of their plan," Lexi said.
But at their pharmacy, generics were of stock. That's when they looked at the Auvi-Q.
Evan and Eric Edwards invented the Auvi-Q after growing up with severe allergies.
"This is very personal for us," Evan Edwards said. "We carry it in our pockets every day."
It's smaller and comes with its own voice instructions.
"Place black end against outer thigh," the Auvi-Q says.
The voice guide is key, Eric Edwards said. "It's all about confidence, and we saw hesitation," he said.
Lexi Henegar liked the product but not the price. The Auvi-Q lists for $4,500.
"So that was kind of disappointing. … They actually called me before they filled my prescription to ask if I wanted them to go ahead and fill it," Lexi recalled.
But drug maker Kaleo stepped in with its affordability program. And the family's out-of-pocket costs were zero. How is that possible? Kaleo CEO Spencer Williamson explained.
"The pricing and reimbursement system in this country is broken. And we're committed to always putting patients and families first," Williamson said.
"You have a drug that has a $4,500 price, how do people get that for free?" Werner asked.
"So it's an access model built for patients... And so the way our program works is that anyone with commercial insurance, whether it's covered or not, even a high-deductible plan, they'll get it for zero dollars," Williamson said.
Richard Evans, a pharmaceutical industry analyst from SSR Health, is skeptical.
"The only insurer that's going to say yes to a $4,500 claim for an epinephrine device in a world where you can buy them for $109 is one that hasn't figured out the game yet," Evans said.
The game, Evans says: to gain market share, a company can give away most of the prescriptions for free and hope that the insurers who do pay those higher prices make up for it.
"It's an insane system. No rational designer would sit down with a clean sheet of paper and say you know what, let's do it this way," Evans said.
"But somebody in that system, somewhere, pays for that high price," Werner pointed out to Kaleo CEO Williamson.
"So, many plans cover the product because it's the right thing for their patients and their physicians and they're very enthusiastic about it. Where plans don't cover it, the entity that steps in and pays is Kaleo," Williamson said.
Patients like the Henegars say they'll take any break they can get.
"Up until now, there weren't really any other options for auto-injectors, there are very few… so I'm hoping it will kind of help even the playing field and bring down prices," Lexi said.
So how will it affect prices? Analysts say in this business, competition can sometimes drive prices higher as drug companies often have to pay more money to insurers to remain on their list of preferred drugs. The Auvi-Q returned to pharmacies in February after a voluntary recall in 2015 under a different manufacturer. Another EpiPen competitor is set to hit the market later this year.