Aside from Mylan’s recent troubles at the FDA and the pricing challenges dragging on the larger generics sector, the company on Wednesday disclosed another potential stumbling block. The drugmaker has received a Department of Justice subpoena into its opioid business, according to a quarterly securities filing.
In the Securities and Exchange Commission document, Mylan described the DOJ subpoena as “seeking information relating to opioids manufactured, marketed or sold by” the company from the start of 2013 to the end of 2016. Mylan said it’s “fully cooperating” with the probe.
The subpoena comes as Mylan’s opioid sales are already under scrutiny from Sen. Claire McCaskill and as the United States suffers from an addiction epidemic. Earlier this year, Sen. McCaskill set out to learn more about painkiller marketing practices from Johnson & Johnson, Mylan, Depomed, Insys and Purdue.
In announcing her investigation, Sen. McCaskill said she wants to learn whether the companies had a role in the United States’ “overutilization and overprescription” of the powerful meds.
Mylan's subpoena is also another indication that U.S. officials are looking to crack down on even small opioid makers. Mylan produces 1% of the country's opioid painkillers, most of which are generic. It's the 17th largest opioid manufacturer in the country.
The day before Mylan received its subpoena on July 27, fellow drugmaker Mallinckrodt received a similar demand, disclosed by that company last week along with its quarterly results. Depomed disclosed a subpoena in its latest 10-Q filing as well. Mallinckrodt's opioid portoflio includes the now-off-patent Exalgo, which brought in $25.6 million in 2016. Depomed's Nucynta has delivered $124 million in sales so far this year.
Separate from the opioid issue, Mylan also has yet to finalize a proposed $465 million settlement with U.S. authorities for allegedly overcharging Medicaid for EpiPen, according to the Wednesday filing. The company agreed to the tentative settlement last October, but the deal has not received official approval. Back in June, a Department of Health and Human Services report concluded that the misclassification actually cost taxpayers $1.27 billion.
Before and since that finding, officials have been calling for the government to dig deeper and get a better deal for taxpayers. As part of the proposed agreement, Mylan won’t admit any fault.
The new SEC filing came the same day as Mylan’s second-quarter results announcement, when execs said that reorganization at the FDA has hurt regulatory submissions for generics of GlaxoSmithKline’s Advair and Teva’s Copaxone. The drugmaker pushed both of those anticipated launches into its 2018 guidance.
Analysts were mixed on the second-quarter results, with Bernstein’s Ronny Gal calling them “not half bad” compared to expectations. Wells Fargo’s David Maris said they’re “not good” on first look, while Evercore ISI’s Umer Raffat told clients to “expect material weakness today.”
Since Mylan’s EpiPen pricing came under fire more than a year ago, the company has faced a number of challenges relating to its dealings with the government and more. But even as new competition sprung up in the epinephrine injector market, the company has had some success retaining EpiPen customers. Recently, Express Scripts reported that the Mylan injector is the PBM giant’s preferred choice for 2018 over a $4,500 option from Kaleo Pharma.