text: SHARE THIS ARTICLE Share Tweet Post Email 
   
   In a 2007 purchase of medicines from Merck KGaA, drugmaker Mylan picked up a decades-old product, the EpiPen auto injector for food allergy and bee-sting emergencies. Management first thought to divest the aging device, which logged only $200 million in revenue. Then Heather Bresch, now Mylan’s chief executive officer, hit on the idea of using old-fashioned marketing in part to boost sales among concerned parents of children with allergies. That started EpiPen, which delivers about $1 worth of the hormone epinephrine, on a run that’s resulted in its becoming a $1 billion-a-year product that clobbers its rivals and provides about 40 percent of Mylan’s operating profits, says researcher ABR|Healthco. EpiPen margins were 55 percent in 2014, up from 9 percent in 2008, ABR|Healthco estimates. 
   
   Photo illustration: 731 
   
   How Mylan pulled that off is a textbook case in savvy branding combined with a massive public awareness campaign on the dangers of child allergies. Along the way, EpiPen’s wholesale price rose roughly 400 percent from about $57 each when Mylan acquired the product. “They have done a tremendous job of taking an asset that nobody thought you could do much with and making it a blockbuster product,” says Jason Gerberry, a Leerink Partners analyst. 
   
   But while EpiPen has given countless parents a sense of security that their children can go out in the world safely, the device’s soaring price—up 32 percent in the past year alone—has forced some families to make difficult choices in order to afford the life-saving medicine. The price increases are among the biggest of any top-selling brand drug, according to DRX, a unit of Connecture that tracks drug pricing. After insurance company discounts, a package of two EpiPens costs about $415, DRX says. By comparison, in France, where Meda sells the drug, two EpiPens cost about $85. “There is a danger with that,” says George Sillup, chairman of the pharmaceutical and health-care marketing department at Saint Joseph’s University. If the company raises the price too much, “that could create some backlash.” 
   
   The company sees it differently. “Mylan has worked tirelessly over the past years advocating for increased anaphylaxis awareness, preparedness, and access to treatment,” Mylan spokeswoman Nina Devlin said in a statement. She said the company doesn’t control final retail prices for EpiPen and offers coupons that eliminate co-pays for most patients. Bresch declined to comment for this story. 
   
   The CEO has made no secret of her strategy to increase demand for EpiPens by getting them stocked for emergency use in more schools and other public places. (So-called entity prescriptions allow for this.) “We are continuing to open up new markets, new access with public entity legislation that would allow restaurants and hotels and really anywhere you are congregating, there should be access to an EpiPen,” Bresch said at a conference on Sept. 17. 
   
   Over the past seven years, Mylan has hired consultants who had worked with Medtronic to get defibrillators stocked in public places. Bresch, the daughter of Senator Joe Manchin (D-W.Va.), turned to Washington for help. Along with patient groups, Mylan pushed for federal legislation encouraging states to stock epinephrine devices in schools. 
   
   CEO Bresch Photographer: Chris Goodney/Bloomberg 
   
   In 2010 new federal guidelines said patients who had severe allergic reactions should be prescribed two epinephrine doses, and soon after Mylan stopped selling single pens in favor of twin-packs. At the time, 35 percent of prescriptions were for single EpiPens. The U.S. Food and Drug Administration had changed label rules to allow the devices to be marketed to anyone at risk, rather than only those who’d already had an anaphylaxis reaction. “Those were both big events that we’ve started to capitalize on,” Bresch said in October 2011. 
   
   In 2013, the year following the widely publicized death of a 7-year-old girl at a school in Virginia after an allergic reaction to peanuts, Congress passed legislation encouraging states to have epinephrine devices on hand in schools. Now 47 states require or encourage schools to stock the devices. 
   
   Since 2012, Mylan has helped popularize its brand by handing out free EpiPens to more than 59,000 schools. Last year it signed a deal with Walt Disney to stock EpiPens in Disney’s theme parks and on cruise ships. And Mylan spent $35.2 million on EpiPen TV ads in 2014, up from $4.8 million in 2011, according to researcher Nielsen. Mylan disputes the ad spending figures but declines to offer alternatives. 
   
   In part because of Mylan’s efforts, the number of patients using EpiPen has grown 67 percent over the past seven years. Many kids with allergies own multiple sets, for school and home. And for doctors, who write prescriptions for the name they know best, the EpiPen brand “is like Kleenex,” says Robert Wood, a pediatric allergist at Johns Hopkins University School of Medicine. 
   
   So far rivals haven’t been able to break Mylan’s market grip. Sanofi’s Auvi-Q, introduced in 2013, is in the shape of a credit card and—unlike EpiPen—gives step-by step audio instructions. But Sanofi priced Auvi-Q about the same as EpiPen, and the product struggled initially to gain insurance coverage. Sanofi says 9 out of 10 patients with commercial insurance can now receive coverage for Auvi-Q prescriptions. Yet in the first half of 2015, EpiPen had about an 85 percent share of epinephrine prescriptions vs. only 10 percent for Auvi-Q, according to Symphony Health Solutions data compiled by Bloomberg. 
   
   Still, allergy sufferers without generous health benefits feel the pain. Denise Ure, a social worker in Seattle, has a peanut allergy so severe that the last time she ingested a nut crumb in 2011, she needed three EpiPens and was hospitalized. Ure says she cried last year when she found out a prescription for two EpiPens would cost her about $350. “I was terrified because there’s this life-saving medicine that I needed, and I couldn’t afford it,” she says. Ure now carries two EpiPens she got in Canada, where they cost about half as much. 
   
   The biggest threat to EpiPen could come from Teva Pharmaceutical Industries. It settled a patent lawsuit in 2012 allowing it to market a generic version of EpiPen as early as this year, if it wins FDA approval. Mylan isn’t too worried. Predicted Bresch in August: “You would not see the traditional market loss because of just the brand equity with EpiPen.” 
   
   The bottom line: When Mylan bought EpiPen in 2007, the devices had $200 million in annual sales. Today revenue exceeds $1 billion. 
   
   (This story updated the graphic to show a more accurate usage of the EpiPen.) 
   
   (This story updated the graphic to show a more accurate usage of the EpiPen.) ||||| Breaking News Emails Get breaking news alerts and special reports. The news and stories that matter, delivered weekday mornings. 
   
   / Updated By Ben Popken 
   
   The cost of saving your child's life has gotten a lot more expensive. 
   
   Parents getting ready for back-to-school season have another item to toss in the basket along with Trapper Keepers and boxes of pencils — and they're facing sticker shock at the latest price increase. 
   
   Doctors and patients say the Mylan pharmaceutical company has jacked up the prices for an EpiPen — the portable device that can stop a potentially life-threatening allergic reaction — from around $100 in 2008 to $500 and up today. 
   
   That's a hike of over 400 percent. 
   
   Mylan didn't invent the EpiPen, it acquired it in 2007, getting a drug that had been approved since 1987 and had 90 percent market dominance. Nor does it manufacture the EpiPen itself. Mylan buys it from a wholly owned Pfizer subsidiary for $34.50 per pen. 
   
   Then in 2009, Mylan launched an upgraded device. A medical device technology expert and a doctor who took apart the "before" and "after" versions of the EpiPen found that despite safety and graphics upgrades, the auto-injectors shared a similar "core." 
   
   Now former pharmaceutical executive Martin Shkreli has weighed in, calling the Mylan company "vultures." 
   
   U.S. Senators are scrutinizing the price hikes, with one calling for an FTC probe. Connecticut Senator Richard Bluemnthal, who pushed for emergency epinephrine to be stocked in public schools, pledged Friday to investigate the "shocking increase." 
   
   UPDATE: On 9/21/16, the House Oversight Committee grilled Mylan and the FDA in a hearing on the EpiPen price hike. 
   
   "Patients are calling and saying they can't afford it," said Dr. Douglas McMahon, an allergy specialist in Maplewood, Minnesota. "They're between a rock and a hard place." 
   
   Following a recall by Mylan's chief competitor last year, the company now enjoys a near monopoly. 
   
   Because of aggressive marketing and branding campaigns, and lobbying for legislation that requires the product to be stocked in schools, they have a brand dominance equal to that of Kleenex, doctors say. 
   
   About the size of a fat marker, they are carried by many parents of kids with severe allergies wherever they go — ready to jam the gizmo into their child's thigh to deliver epinephrine and stop anaphylactic shock from a potentially fatal bee sting or bit of peanut. 
   
   An EpiPen. Carlos Osorio / AP file 
   
   And because they have a stated expiration date of one year, parents refill them annually, incurring an additional co-pay each time. 
   
   Tracy Bush, a 42-year-old mom and food allergy consultant, never goes anywhere without two EpiPens on her. Her son, age 14, carries another. She began doing so after he was diagnosed with severe allergies as a 2-year-old. 
   
   For the past 10 years, she has watched the price she paid for her refills rise higher and higher with no discernible improvement to the device or medicine. 
   
   In 2008, Bush said the price was $145.99. In 2010, it was $220.99, then jumped to $649.99. This year her pre-insurance costs were $1,118.08. 
   
   Despite the hikes, Bush was glad to have the device two years ago when her son had a bad reaction while eating some watermelon. 
   
   "He said it felt like a potato chip was caught in his throat. Then he got a look of terror on his face. His voice was totally different, it sounded like he had sucked helium. I was like 'Oh my goodness, I'm going to have to use an EpiPen,'" she said. "I will never forget the look that I saw." 
   
   In a statement, Mylan said that the prices have "changed over time to better reflect important product features and the value the product provides," and that "we've made a significant investment to support the device over the past years." 
   
   The company also offers coupons on its website that can reduce costs. This year, for the first time, Bush was able to use those coupons and her "good" insurance plan to bring down her out-of-pocket costs to zero. But not everyone can do the same. 
   
   "When epinephrine only costs a few cents, but they're going up to $500, personally I don't think that's ethically responsible," said Dr. McMahon. 
   
   And he understands better than most what costs are involved: For the past few years he's been developing his own, smaller version of the EpiPen, and trying to get it approved by the FDA and bring it to market. He estimates that process costs about $1.5 million. In 2015, Mylan's profits from the sale of EpiPens rose to $1.2 billion. 
   
   McMahon says his device will retail for about $50. 
   
   Vermont Sen. Bernie Sanders, the former presidential contender and a member of the Senate Committee on Health, Education, Labor and Pensions, told NBC News in a statement: 
   
   "The drug industry's greed knows no bounds. There's no reason an EpiPen, which costs Mylan just a few dollars to make, should cost families more than $600. The only explanation for Mylan raising the price by six times since 2009 is that the company values profits more than the lives of millions of Americans." ||||| Families with severe allergies often rely on EpiPens to deliver a dose of potentially life-saving medicine if a child has a bad reaction. But the cost of the EpiPen is surging, putting the pinch on many families. 
   
   The EpiPen is filled with epinephrine, which can counter the effects of a severe allergic reaction. The auto-injector's price has risen by more than 480 percent since 2009. The actual cost of the drug inside the EpiPen is only a couple bucks, reports CBS News correspondent Vinita Nair. So the manufacturer is essentially charging hundreds of dollars for a case -- and a trusted name. 
   
   An EpiPen is never far away in the Henegar household where dinner time is a cautious time. Of the family's six children, two have severe food allergies: 3-year-old Cora and 7-year-old Ellie. 
   
   Ellie has a laundry list of foods to avoid, including dairy, wheat, soy, eggs, peanuts, tree nuts and sesame seeds. It's why both girls never leave their Indianapolis-area home without their fanny packs. 
   
   As a baby, Ellie's allergic reactions were so severe, hives covered her entire body. Her family has twice used the EpiPen to save her life. 
   
   "Her lips turned blue, she started swelling, she wasn't able to breathe," mother Lexi Henegar recalled. 
   
   They have to replace the injectors every year when they expire. The Henegars remember paying as little as $80 for them five or six years ago before they switched to a high-deductible health plan. 
   
   "We really noticed it in the past year, year and a half when we went to go have it filled. It was $600," Lexi said. 
   
   "When the pharmacist first told you the bill, did you think 'You must be wrong?'" Nair asked. 
   
   "I did. I had her look it up again and she didn't have to because she had answered that question many times with many other people who asked her the same question of, 'Are you sure that the EpiPen is that expensive -- and it is," Lexi said. 
   
   In 2009, pharmacies paid slightly more than $100 for a 2-pack of EpiPens. The price has since skyrocketed to more than $600. 
   
   "If they don't have [the EpiPen], it could mean life or death," pharmacist Leon Tarasenko said. 
   
   Tarasenko said the high prices are forcing some families to take risks. 
   
   "Within the last two months, we've had about three patients who had issues with the price of an EpiPen. And we actually -- they did not receive it. They just refused to take it," Tarasenko said. 
   
   Bloomberg senior medical reporter Robert Langreth says the manufacturer of the device, Mylan, has a virtual monopoly after its main competitor launched a recall last fall. 
   
   "This brand name, EpiPen, it's like Kleenex to allergists," Langreth said. "You know, it's a name they know and trust. It's what they prescribe." 
   
   He said the company has remarketed the decades-old device without making any significant changes since acquiring it in 2007. It has spent tens of millions of dollars on TV ads and donated the device to schools across the U.S., ensuring it was a familiar product. 
   
   "It's a totally established brand name with little competition," Langreth said. "That gives them freedom to raise the price every year." 
   
   In a statement, Mylan tells CBS News the EpiPen's price "has changed over time to better reflect important product features and the value the product provides," saying "we've made a significant investment to support the device over the past years." 
   
   The company offers coupons, which have allowed many patients to pay nothing out-of-pocket. Those coupons are worth up to $100, so families with high deductibles like the Henegars are still on the hook for the majority of the cost.
target: – It's the size of a marker and as common as Band-Aids in a school nurse's office. EpiPen, a device that delivers a dose of epinephrine that can stop an extreme allergic reaction, has been credited with saving the lives of children for whom a peanut or a bee sting could be fatal. But drugmaker Mylan has hiked the price of the device by nearly 500% over the past few years, CBS News reports, and parents and doctors aren't happy. "When epinephrine only costs a few cents, but they're going up to $500, personally I don't think that's ethically responsible," allergy specialist Dr. Douglas McMahon told NBC News. “Patients are calling and saying they can't afford it.” (McMahon is seeking FDA approval for his own device that he says will cost $50.) Twice in her seven years, Ellie Henegar’s life was saved with an EpiPen, but her parents were stunned last year when the bill came to $600, they told CBS. Compare that to 2009, when the bill was about $100 for the same two-pack of EpiPen. While insurance covers varying degrees of the cost, not everyone is lucky enough to have a plan that does, NBC notes. With a near monopoly, Mylan has little incentive to cut the price, Bloomberg reports. In fact, Mylan execs considered dumping the aging product in 2007. Instead, they launched a marketing campaign that turned the device into an essential, donating EpiPens to schools and dropping $35 million on TV ads. A law passed by Congress in 2013 requiring schools to stock epinephrine devices also boosted sales, which last year totaled $1 billion. Mylan contends it has made a "significant investment" to improve the device and offers coupons. "It's a totally established brand name with little competition," Bloomberg’s Robert Langreth tells CBS. "That gives them freedom to raise the price every year."