Table of Contents
- 1 Investor’s outrage cost MYLAN Pharmaceuticals a massive loss of 3-billion dollars in 5 days
- 2 A massive downfall reported on MYLAN’s stock price
- 3 The relevance of EPIPEN in the context of national health
- 4 A downfall that is the outcome of the race of the customers
- 5 An act of child plays with the provision of legal enactments
- 6 An instance of worst exploitation of personal contacts and influences
- 7 Exploiting the compulsion of the mass
- 8 Share this:
Investor’s outrage cost MYLAN Pharmaceuticals a massive loss of 3-billion dollars in 5 days
Mylan Pharmaceuticals is a company that manufactures the EPIPEN devices. These devices get used for rescue purposes. Recently, the company has experienced an instance of its stock value had a major downfall. This instance triggered panic among the investors.
EPIPEN is a commonly used device to bring relief from the food allergy problems. The prime users of this device are the folk that is prone to the threat of Anaphylaxis. It is a detrimental reaction to probable allergen exposure.
This device instantly imparts epinephrine to the body system. Severe allergic outburst can blur the line that separates death and life. This device got innovated and developed by Sheldon Kaplan, a researcher with the department of Defense, US.
The research and the test formalities got financed by the government revenues. The device acts as an antidote towards nerve gas. However, it got dedicated to the mass for serving them as an instant solution to anaphylactic shock.
A massive downfall reported on MYLAN’s stock price
MYLAN recently decided to hike the cost of its EPIPEN devices. As reported by the US Uncut, the market didn’t accept this decision. The downfall is a reaction to showcase the outrage against this decision.
The company experienced a sharp slap from the investors. Hence, the valuation of the stock fell sharply by a whopping margin of 12%. As, for instance, the value of each share of the company came down to $ 43.11 from a level of $ 49.20 between August 19th and 24th. This cost the company a massive loss of 3 billion dollars.
The relevance of EPIPEN in the context of national health
About 15 million people in the US are victims to food allergy. 1 out of every 13 minors in the US suffers from this ailment. Research data suggest that every 3 minutes, an American goes to the intensive care unit in a hospital, affected by food allergy.
This accounts for a massive hike on medical purposes. In such an instance, EPIPEN was about to take a position of savior for the mass. However, the uncanny policy of the company changed the entire picture.
A downfall that is the outcome of the race of the customers
Tom Cahill of US Uncut stated that this is not the first time the company hiked the price for this device. MYLAN got the commercial right over the device in 2007. Immediately after this, the company raised the price. In addition, there were consistent hiking in its price by whopping margins of 10% or above, through 4 consecutive quarters.
This went on for the period between the year 2013 and 2016. As per report, the company took a very unfair advantage of the legislation that made it compulsory for students with food allergy to carry the EPIPEN devices.
These instances prepared the ground that eventually resulted in the massive collapse. A portion of the US senators even demanded that an investigation gets initiated on the cause of these hikes. Thus, what is happening today is not an event, but an outcome of retrospective activities that once swore the book profit of the organization.
An act of child plays with the provision of legal enactments
The report produced the evidence that there have been several instances where the company did not adopt the code of business laws and ethics. Heather Bresch is the lobbyist who influenced the US government to make EPIPEN a must for children with food allergies. She is the daughter of US senator Joe Manchin.
During her association with the company, Heather raised her salary by an unbelievable margin of 617%. She even instrumented the offshore reincorporation of the company in the Netherlands; vide the enactment of looser corporate laws. But, the enterprise continued with its US headquarters.
This is a grave noncompliance as the enactment makes it compulsory that such reincorporation should get limited to organizations with its headquarters in the Netherlands. This practice gets called “Inversion”. US organizations, of let, are maliciously using this technique to cut down the prevailing tax rate.
However, they will keep up enjoying the benefits that the law entitles them. Us organizations keep up its domestic operations and retain their headquarters in the US soils. This marks a major exploitation of the enactment that is basically meant to benefit the trade & commerce in the Netherlands.
An instance of worst exploitation of personal contacts and influences
The Branch’s name got included in Fortune’s “most powerful women” in the year 2015. She took an interview with CNBC last Thursday. In the course of the disclosure, she tried justifying her massive salary hike, based on her performance.
In addition, she said that the company’s decision to hike the price of the device by a margin of 450% was typically an instance that is commonly practiced in contemporary pharmaceutical industry. The aforesaid interview sounded disastrous to the audience. They got upset and annoyed by the Bresch arrogance. Her efforts to justify the decision of the company dug the grave deeper.
Exploiting the compulsion of the mass
Interview Brian Kelly pinpointed on the fact that Bresch illegitimately exploited her power and influence at the government level for marketing the products aggressively. Brian floated the idea that the company influenced the lawmakers to make its devices compulsory.
Then, the organization took an unfair advantage by bringing a whopping hike in its price. This is something that is all about fooling laws and reaping benefits out of the loopholes in an enactment. It is absolutely unsolicited that a company reaps unfair economic benefits from a life-saving device.
This has contradicted the government standing to extend affordable medical care to the US citizens. Kelly slashed Bresch to the point that her massive salary hike got financed out of the compulsion of the citizens.
As obvious, Bresch protested the notion and she tried justifying the acts as a sheer act of entrepreneurship. Though, neither the business experts nor the mass agreed with her advocacy.
These disclosures definitely have a negative impression in the minds of the mass. Experts are of the opinion that investors took it as an ethical standing to oppose this perception of the company. Hence, they decided to pay back the company its own coins. After all, even if investors are after the profit, the call of humanity always wipes off the profit aspiration.