THE ASSEMBLY

STATE OF NEW YORK

ALBANY
JOHN T. MCDONALD III
th
Assemblymember 108 District

COMMITTEES
Aging
Alcoholism and Drug Abuse
Cities
Insurance
Mental Health and
Developmental Disabilities
Real Property Taxation

September 21, 2016

Attorney General Eric Schneiderman

Office of the Attorney General
The Capitol
Albany, NY 12224-0341

Dear Attorney General Schneiderman:

First and foremost, I would like to extend my support for the recent investigation your office has opened in regard to the
potentially anti-competitive terms that the manufacturer of the EpiPen (Mylan) may have required in sales contracts with
school districts. The allegations, if true, are unacceptable and should be fixed. Public policy should be reviewed to correct
this type of behavior.
As you continue this investigation, I encourage you to expand this effort. I believe that there is more than a rogue
manufacturer in play in this game. As is widely known, the EpiPen has witnessed a 400% increase in price over the last
decade, while there has been no meaningful improvement to the product or expanded indications to justify a price increase.
During this time consumers, directly and indirectly have shouldered the burden of the cost. Directly in regard to their
copayments they have paid at the pharmacy register and indirectly through escalating health care premiums as abnormal
increased drug costs amongst other factors have played a role in the rising cost of health care. Government, employers and
consumers again, pay the price.
The lack of a generic alternative to EpiPen is an area that needs to be examined. Recently, a legislator introduced legislation
to enhance the substitution of EpiPen once a product comes to market. This legislation, while well intended, is not
necessary. Pharmacists have the opportunity already to substitute a less expensive alternative than the EpiPen. As a
pharmacist, I am aware of this product.
The product, Adrenaclick, has been on the market since 2013 and is a third of the price of EpiPen. The product and EpiPen
are both BX rated which means neither drug has an equivalent generic however; this does not prohibit generic substitution.
As background, most medications that are generically equivalent have an AB rating which by NYS law requires substitution
and therefore is mandatory unless a prescriber notates otherwise. For medications that are BX rated they are not required to
be substituted however, NYS Education Law allows a pharmacist, using his/her discretion, to substitute one product for the
other. Therefore, there is a generic for EpiPen. The issue is will anyone pay for it?
Knowing what is mentioned in the prior paragraph, one would logically assume that many EpiPen prescriptions are
substituted with the Adrenaclick brand, which is less expensive. Correct? Actually, it is not. I can attest to this fact first hand
as I practice pharmacy regularly. You will find it interesting to know that most prescription drug plans exclude the
Adrenaclick from coverage and therefore require the patient to secure the more costly EpiPen. Now at times the cost to the
patient may be negligible and at times it may not. But questions do arise including the following:

Room 417, Legislative Office Building, Albany, New York 12248 518-455-4474, FAX: 518-455-4727
EMAIL: mcdonaldj@assembly.state.ny.us
www.assembly.state.ny.us

Why are the brand name covered and the generic not?

What cost does the patient have attributed to their drug benefit when they receive the EpiPen vs the Adrenaclick,
many of which have plans that have medication cost ceilings?

What makes the more expensive medication less expensive when health insurance is involved?

Might it be the rebate that the manufacturer is guaranteeing to the Program Benefit Manager (PBM)?

Is the PBM sharing the rebate with the health plan?

Is the PBM sharing the rebate with the patient, or the employer or the governmental entity that is paying for the
EpiPen at the end of the day?

The questions above need to be asked because of the lack of transparency in the prescription drug benefit world. Now I am
not anti-PBM as they serve a role and purpose in regards to assisting management of prescription costs and also in measuring
outcomes which is what our health care system is moving in that direction. However, as a practicing pharmacist for over 32
years, it is clear that patient, employer, pharmacy and possibly even the health plan that contracts with the PBM are not
aware of what the true actual cost of the medication is at the end of the process. The issue is not just with EpiPen or Mylan.
This lack of knowledge, in my mind calls for your office to further the investigation. I would suggest a review of the New
York State government sponsored plans as well as NYSSHIP plans to acquire further information. I believe this issue is
larger than one would have originally thought. Recently, there have been reports about the middle class seeing for the first
time a rise in household income. That, unfortunately, is being negated by the rising cost of health care and the continued
pressure on employees to shoulder costs. This is impacting our working class families. We need to make sense of this issue,
especially as government continues to take on a more active role of subsidizing health care or managing it.
Thank you for your continued work and I am available for any further questions.

Sincerely,

Member of Assembly
John T. McDonald III

Room 417, Legislative Office Building, Albany, New York 12248 518-455-4474, FAX: 518-455-4727
EMAIL: mcdonaldj@assembly.state.ny.us
www.assembly.state.ny.us