(Bloomberg) — Allergan PLC laid out a plan to curb price increases on its drugs in response to public outcry over the costs of medication industrywide, most recently revolving around the price of Mylan NV’s EpiPen.
Allergan will raise prices on its products only once a year, and increases will be limited to the single-digit percentage range, Chief Executive Officer Brent Saunders said in a blog post on the company’s website. That should limit overall increases on prices to no greater than “slightly above” the current rate of inflation, he said.
The pharmaceutical industry has a “social contract” with patients, including an understanding that drugs should be priced to be accessible while providing profits to fuel research and development, Saunders said. Mylan has become the target of Washington lawmakers and public outrage after raising the price of EpiPen, used to quell life-threatening allergic reactions, by more than 400 percent since acquiring the drug in 2007.
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“I understand the public outcry and add my voice to the condemnation,” of dramatic price increases on life-saving medicines, Saunders said in the post. “Those who have taken aggressive or predatory price increases have violated this social contract!”