Adaptive Market Leadership

CASE ON EPIPEN
Batch: 2016-2018 Section: CD

SUBMITTED TO: SUBMITTED BY:

PROF. SUBODH TAGARE Group Members:

S.N. Name Roll No.

1. Gaurav Goel 201611318
2. Kushagra Rastogi 201601327
3. Ketul Sharma 201611324
4. Stuti Choudhary 201610316
5. Rituja Das 201600335
6. Chinmay Toria 201601241
1. INTRODUCTION
EpiPen is a brand name for an epinephrine auto-injector device used to manage potentially life-
threatening anaphylactic reactions to allergens. Epinephrine is the first-line treatment for life-
threatening allergic reactions. Patients are recommended to have an epinephrine auto-injector
immediately available if they have a history of life-threatening allergic reactions (anaphylaxis)
to things like bee stings, peanuts or seafood, or are at increased risk for a severe allergic reaction.
Those at high risk are recommended to have two sources of epinephrine available at all times.
EpiPens contain a single dose of epinephrine that is injected into the outer thigh if signs of a
serious allergic reaction are present. The first epinephrine auto injector was brought to market in
the 1980s. The injectable delivers a dose of epinephrine, otherwise known as adrenaline, to
treat extreme allergic reactions. It's been around for more than a century. And the pen that delivers
the medication has been around since the 1970s, when it was first developed for the military. Since
2007, the price for a two-pack has gone up from $93.88 to $608.61, an increase of more than 500%.

2. BACKGROUND
Epinephrine, another name for the hormone adrenaline, is something our bodies produce
naturally. It increases blood flow to the muscles during "fight or flight responses." Japanese
chemist Jokichi Takamine is credited as one of the first people to discover and isolate
adrenaline as its own chemical. Doctors continued to investigate how adrenaline works during the
early part of the 20th century. In the past 100 years, it's been extensively studied, with more than
12,000 studies referencing it. The study of epinephrine jump-started other areas of emergency
medication for heart and lung problems. The hormone is now used in hospitals around the
world, and is included on the WHO's list of essential medicine. It only costs a few dollars for a
vial. In the 1970s, Sheldon Kaplan, a biomechanical engineer, unknowingly invented the ultimate
way to self-inject epinephrine. At first, his device, called the ComboPen, was used by the
military to protect soldiers in the event of chemical warfare. The military needed a device that
wouldn't react with the drug inside, and that could be easy to use in emergency situations. Shortly
after, Kaplan and others noticed that this same device could be used to deliver emergency
epinephrine to treat allergic reactions. The drug and device combo we now know as an EpiPen
was first approved by the FDA in 1987. By then, it was owned by a company called Meridian
Medical Technologies. Meridian Medical is now a subsidiary of Pfizer, where it still makes a
host of other auto-injector devices including an anti-nerve-gas pen still in use by the military.
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The EpiPen passed hands a few times on the commercial side of things before ending
up with Merck KGaA, a German company who sold their generics business to Mylan
Pharmaceuticals in 2007. (Meridian is still the contract manufacturer of the EpiPen, though
it is sold and marketed by Mylan.) When Mylan acquired the EpiPen, the drug was making about
$200 million a year. Now, it makes more than $1.1 billion a year. Mylan has about 90% of the
market share for epinephrine devices. Other devices do exist, but none has been able to grab much
of the market from the EpiPen. Among them was a device called Twinject that was first
approved in 2003 and then was later updated to become Adrenaclick. Another device, the
Auvi-Q, was first approved in 2012.

3. COMPETITORS TO EPIPEN

Adrenaclick
Adrenaclick is an emergency injection of Epinephrine manufactured by Impax
pharmaceuticals. It is a medicine used for life-threatening allergic reactions such as
severe swelling, breathing problems, or loss of blood pressure.
It is a cheaper alternative for a dose of Epinephrine, which is available at Walmart and
Sams Club at a price of $142. The major problem being that the injector operates
differently which infuses confusion. Adrenaclick provides the same medication with
different amount of dose as compared to EpiPen.
Auvi-Q
Sanofi and Kaleo, had launched a similar auto-injector of Epinephrine named Auvi-Q. But
due to safety reasons it withdrew the product. Later, Kaleo continued the product and
relaunched Auvi-Q with a price of $4,500 which was far costlier than EpiPen

4. CONTROVERSIES FACED BY EPIPENS

In the year of 2016-17 company faces many problems with their product and indulged in many
controversies. Some of the controversies are stated as follows

Tens of thousands of EpiPens, sold by Mylan NV, were recalled worldwide in March
following two reports of the life-saving allergy shot failing to work in emergencies. A U.S.
regulator this week told Pfizer Inc.s Meridian Medical Technologies division, maker of the
EpiPen injector device, that serious component and product failures have been associated with

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patient deaths and severe illness. Meridian Medical Technologies, has issued a
voluntary recall for 13 lots of the EpiPen and EpiPen Jr. (epinephrine injection) Auto-Injector
distributed in the U.S. The recall is due to two reports of failure to activate the device. While
a rare problem, device failure could be life-threatening.

In the United States, every three minutes a food allergy reaction sends someone to the emergency
department. That adds up to more than 200,000 emergency room visits per year. One in 13
children or roughly two in every classroom in the United States lives with a life-threatening
food allergy. In 2015, an estimated 3.6 million people in the U.S. were prescribed an EpiPen.
Allergic reactions also accounted for about 200,000 emergency room visits per year, or one every
three minutes. An additional burden to families is that the EpiPen has a short shelf life, and
generally is refilled yearly. Further, most schools require that students have at least two EpiPens,
and families also need the product at home. Its clear how the cost for families readily
skyrockets. So the market for epinephrine auto-injectors is quite large and estimates that sales
of prescription epinephrine products were approximately $1.2 billion. Mylan had purchased
the product in 2007, then raised the price by about 600%. Mylan incurred justifiable outrage
for jacking the price of its lifesaving EpiPen to more than $600 per injection. The shots are
essential for people with a severe acute allergic reaction like anaphylaxis to foods, medicines or
insect stings.

Certainly the size and timing of the price hikes played a role. In less than a decade, average health
care deductibles have risen from approximately $300 to more than $1,000, with some families
now facing annual deductibles of almost $5,000. In that same time period, the percentage of
individuals enrolled in high-deductible insurance plans has gone from less than 5 percent
to potentially approaching 40 percent in the coming year. This means that a family whose fixed
copay a few years ago was $25 or $50 per prescription for their twin pack of EpiPens could get
the recommended multiple sets for school, home, and to carry around for about $75 to $150.
Today, many are now required to pay list price upwards of $600 for each set, or almost
$2,000 to satisfy their deductibles.

In response to the furor over their price gouging, Mylan came out with its own generic version,
priced at only $300still far higher than the original price of $57.

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5. DECISION DILEMMA
The Dilemma remains that
Should Pfizer reduce the price of an EpiPen to an affordable level or think some of
alternatives to cover up the high prices that they charge?
Should FDA and Government modify the current policies and regulations?
7. REFERENCES
https://www.reuters.com/article/us-pfizer-mylan-epipen/u-s-fda-warns-of-problems-with-
epipen-manufacturing-plant-idUSKCN1BI2Y5
https://www.forbes.com/sites/judystone/2017/04/03/given-the-price-of-an-epipen-
mylans-injector-ought-to-work/#14afcb1f68d6
https://www.statnews.com/2016/09/28/epipen-price-pharmaceutical-industry/
https://www.forbes.com/sites/judystone/2017/04/03/given-the-price-of-an-epipen-
mylans-injector-ought-to-work/#3c99789f68d6

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