WHAT WOULD YOU DO ANALYSIS REPORT First reading. Become familiar with the situation of the organization: Identify insights into the problem Obtain background information on the environment and organization Second reading. Pay attention to key facts and assumptions: Determine relevance and reliability of the data Avoid these pitfalls: Do not rush to a conclusion Do not confuse belief with fact Sub-headings - Make sure you use sub-headings in your report Conclusion and Recommendation Present your thoughts and opinions on what you think is the appropriate solutions, however you need to use information presented in the text/chapter as a foundation and rationale for your recommended solutions. Your discussion should be comprehensive and include any reference and citation for material or information use taken from the book or other authors. WHAT WOULD YOU DO? ? Mylan Headquarters, Canonsburg, Pennsylvania It's 2012 and Mylan, the company behind the EpiPen government institutions are among EpiPen customers Auto-Injector, is in the middle of a lawsuit. To settle. because the medication is used for emergency treat- they agree to allow a generic competitor into the ment of allergic reactions market in 2015, knowing this will cut into a big part of Bresch said she is as frustrated by the price increase their business when the time comes. EpiPen is an epi- as customers, saying everyone should be frustrated nephrine auto-injector used to treat emergency allergy She said the price reflects a system where intermedi- reactions. EpiPen has been on the market since the aries such as wholesalers, retailers and pharmacies 1980s but remains under patent because of the device, all add to the ultimate list price of the medication particularly the safety cap for the needle, not the active The system also requires customers to pay insurance ingredient, epinephrine. Epinephrine is a hormone premiums and out-of-pocket costs for prescriptions made by the body known as adrenaline and was first medications isolated more than 100 years ago. "The patient is paying twice" Bresch said. They're In the years leading up the 2012, Mylan had paying full retail price at the counter, and they're pay already been increasing the prices of EpiPen steadily. ing higher premiums on their insurance. It was never In 2007, the cost was around $100 for an EpiPen two- intended that a consumer, that the patients would be pack; by 2011, $165. After the settiement, Mylan used a paying list price, never. The system wasn't built for that common practice in big pharmaceutical companies of In response to backlash from the high prices, Mylan sharply increasing the price of a medication in the years announced plans to expand its co-pay assistance pro- before a generic becomes available. It is a final attempt grams, double eligibility for its patient assistance pro- to make big profits off the brand-name drug before los- gram to 400% of the federal poverty level, continue to ing business to the generic. Drug manufacturers justify offer the EpiPen4Schools program, and open pathways the high prices saying they cover the cost of years of so patients can order EpiPen directly from the com- research and development that went into creating the pany, thereby reducing the cost. EpiPen4Schools was drug originally launched in 2012 and has provided more than 700,000 Now it's 2016, and Mylan is charging around $600 free EpiPens to more than 65,000 schools nationwide. for an EpiPen two-pack. However, Teva, the expected Representative Elijah Cummings (D-Maryland) was generic, was rejected by the Food and Drug Adminis- not impressed by Mylan's announcement. Offering a tration, and Auvi-Q EpiPen's nongeneric competition, meager discount only after widespread bipartisan criti- was pulled from the marked due to dosing problems. cism is exactly the same tactic used by drug companies EpiPen now has a monopoly on the market for this life- across the industry to distract from their exorbitant saving drug, and people are outraged by the price. With price increases."Cummings said. "Nobody is buying this no alternatives available, customers and politicians PR move anymore. Mylan should not offer after-the-fact alike are demanding answers and change. discounts only for a select few - it should reverse its Senator Chuck Grassley (R-lowa) wrote in a letter massive price increases across the board immediately to Mylan CEO Heather Bresch, "1 am concerned that the After continued criticism, Bresch reiterated that substantial price increase could limit access to a much- price is only part of the problem. "All involved must also needed medication" Democratic presidential nominee, take steps to help meaningfully address the U.S. health Hillary Clinton's campaign spokesman Tyrone Gayle care crisis" she said, and we are committed to do our called for price cuts saying, "Since there is no apparent part to drive change in collaboration with policymak- justification for the price increase, Mylan should imme- ers, payors, patients, and health care professionals diately lower the overall price of EpiPens. People suf- Customers are no longer quietly tolerating in- fering from life-threatening allergies won't be the only creases to the price of their medications as they await ones affected by the price increase. Public schools and lower-cost and generic solutions. As additional Mylan products begin to face competition from generics, solu- tions will have to be found to make up for loss of future revenue. Is raising medication prices the model to use in the future? What other solutions are available? The company will have to adapt to survive as more competitors enter the market. What benefits would there be to a change in organizational structure or process? Should departmentalization be considered for Mylan? If so, what type of departmentalization? As problems arise and solutions are pondered, who has the authority to make the ultimate decision? What is the best chain of command when big pronounce- ments have to be made? If you were CEO at Mylan, what would you do? 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