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Congressional Committee Accuses Amgen and Peers of Hiking Drug Prices to Meet "Aggressive" Revenue Targets

By Eric Volkman – Oct 2, 2020 at 9:52AM

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A House committee has issued detailed reports about some of their drug price increases.

In the midst of hearing testimony from Amgen (AMGN -1.32%), Mallinckrodt (MNK), and Novartis (NVS -0.73%) executives about their business practices, a House of Representatives committee on Thursday issued a new series of reports alleging malfeasance in drug pricing by all three companies.

The House Committee on Oversight and Reform accused those pharmaceutical companies of raising prices of important drugs purely to hit financial targets. In each company's case, the reports focus heavily on one or two medications that have seen significant price increases.

Gloved hand holding a beaker full of money.

Image source: Getty Images.

For biopharmaceutical giant Amgen, the investigated drugs are top-selling inflammatory diseases treatment Enbrel, and the calcium-lowering drug Sensipar.  

According to the report, since Amgen acquired the rights to Enbrel in 2002, it has raised the drug's price 27 times -- for a total increase of nearly 460% -- to the current level of $5,556 for a one-month supply. Meanwhile, the company has -- with a series of 20 price hikes -- more than tripled the price of Sensipar since its 2004 rollout. A year's supply of that medication now costs $9,814.

The price increases were even more dramatic for Mallinckrodt's H.P. Acthar Gel, a treatment for a rare infant seizure disorder and several other autoimmune and inflammatory afflictions. And Novartis has boosted the price of the chronic myeloid leukemia drug Gleevec nearly five-fold.

"Drug companies are targeting the United States for their biggest price increases in the entire world, bringing in tens of billions of dollars in revenues, making astronomical profits, and rewarding their executives with lavish compensation packages -- all without any apparent limit on what they can charge," the House committee wrote on its website.

Executives from Celgene and its owner Bristol Myers Squibb, and Teva Pharmaceuticals have also provided testimony to the House committee, and it has issued reports on those companies as well.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Bristol Myers Squibb. The Motley Fool recommends Amgen. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Novartis AG Stock Quote
Novartis AG
NVS
$76.01 (-0.73%) $0.56
Amgen Inc. Stock Quote
Amgen Inc.
AMGN
$225.40 (-1.32%) $-3.01
Mallinckrodt Public Limited Company Stock Quote
Mallinckrodt Public Limited Company
MNK
Teva Pharmaceutical Industries Limited Stock Quote
Teva Pharmaceutical Industries Limited
TEVA
$8.07 (3.20%) $0.25
Bristol Myers Squibb Company Stock Quote
Bristol Myers Squibb Company
BMY
$71.09 (-0.86%) $0.62

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