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In this July 8, 2016, file photo, a pharmacist holds a package of EpiPens epinephrine auto-injector, a Mylan product, in Sacramento, Calif. Mylan has started selling a generic version of its emergency allergy treatment EpiPen at half the price of the branded option, the cost of which drew national scorn and attracted Congressional inquiries. Photo: Rich Pedroncelli, AP File)

Mylan jacked up the price of a life-saving EpiPen by 400 percent over six years – but knowingly claimed it was a generic to avoid paying a full Medicaid rebate to the government, the company admitted Wednesday.

They agreed to pay $465 million to resolve the claims under the False Claims Act – and under that law, some $38.7 million will go to the whistleblower on the case, pharmaceutical giant Sanofi-Aventis.

“Mylan misclassified its brand name drug, EpiPen, to profit at the expense of the Medicaid program,” said William D. Weinred, acting U.S. Attorney. “Taxpayers rightly expect companies like Mylan that receive payments from taxpayer-funded programs to scrupulously follow the rules. We will continue to protect the integrity of Medicaid and ensure a level playing field for pharmaceutical companies.”

The authorities had alleged that Mylan purposefully misclassified the EpiPen as a generic to dodge the higher rebate paid to Medicaid for single-source and brand name drugs.

Within 10 days, Mylan will pay $231.7 million to the U.S., according to the settlement agreement. An additional $213.9 million will go toward the states, it adds.

As part of the agreement, Mylan agreed to submit to an independent review annually for checks on its Medicaid drug rebate compliance, which will be overseen by the U.S. Department of Health and Human Services Office of the Inspector General.

But the U.S. reserves – and has not released – liability from the tax codes, and criminal liabilities, they add.

Sanofi explained that it was their innovation of their own epinephrine injection, called Auvi-Q, which led to their discovery of Mylan's unfair business practices, they explained in a statement provided to Laboratory Equipment.

The company provided three years' worth of information to regulators before the suit was filed over Mylan's "anticompetitive behaviors," they added.

"It was our contention that Mylan's intentional misclassificationof EpiPen allowed them to amass hundreds of millions of dolalrs whcih they then used to finance their anticompetitive behavior in the marketplace," they said. "We contended that Mylan's efforts to purposefully block Auvi-Q on the commercial side resulted in insurance plans and pharmaceutical benefit managers either not covering Auvi-Q or placing Auvi-Q in unfavorable positions on drug formularies, leading to substantially limited patient access to Auvi-Q."

The litigation against Mylan continues with different complainants. In April, EpiPen users filed a lawsuit under the terms of the Racketeering Influenced and Corrupt Organizations, or RICO, Act. The lawsuit argues that the 17 price increases that Mylan imposed since acquiring the EpiPen in 2007 – an overall markup from $90.28 to $608.62, amounts to a “behind-the-scenes quid pro quo arrangement” that was designed to increase profits at the expense of patients.

In this Sept. 21, 2016 file photo, Mylan CEO Heather Bresch testifies on Capitol Hill in Washington. Photo: Pablo Martinez Monsivais, AP File
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