Moneymakers: How the EpiPen became a $1bn blockbuster and caused a political storm
Price gouging has become a hot topic for the pharmaceutical industry in America. The latest storm involves the EpiPen, a device that delivers a shot of adrenaline for patients suffering a life-threatening allergic reaction.
Price gouging has become a hot topic for the pharmaceutical industry in America. The latest storm involves the EpiPen, a device that delivers a shot of adrenaline for patients suffering a life-threatening allergic reaction. The EpiPen has been around since the late 1980s, but since drugmaker Mylan Pharmaceuticals acquired the rights to the device in 2007, it has cranked the price up to the point where many users say they can no longer afford them.
The EpiPen is packed with just a few dollars' worth of medicine, but the wholesale price of a two-pack of the device is more than $600, up from less than $100 in 2007, says The New York Times. By contrast, a two-pack sells for the equivalent of $85 in France, accordingto Bloomberg. This has meant healthy profits for Mylan. Annual EpiPen sales have risen fivefold since 2007 to $1bn. Margins were 55% in 2014, up from 9% in 2008, estimates researcher ABR Healthco.
Mylan hasn't only relied on price rises to maximise its profits from the EpiPen. It's also run public awareness campaigns about allergy risks, targeted at concerned parents. The chief executive, Heather Bresch, who is the daughter of Democratic senator Joseph Manchin, has also lobbied Washington to introduce new laws that would
Just enjoy the climb
Laura Tenison came up with her business concept while lying in a hospital ward. She had been working happily as an estate agent in the south of France when she suffered a head-on car collision, breaking 20 bones in her body. The woman in the next hospital bed had a stack of catalogues for children's clothes, but they were "not very exciting" and Tenison thought she could do better. She decided to sell French, "nautical-style" clothing to British customers, adding a "big dose of quirky British humour" to her patterns and designs. Twenty-three years later, the company she founded, JoJo Maman Bb, has 75 stores, 700 employees and sales of £55m.
Tenison (pictured) is proud to be a large employer and loves being in a sector that is about making babies "giggle", she tells the Evening Standard, but "retail is relentless and running your own company is all consuming". From bad weather to Brexit, the crises are never-ending. "I work, or think about JoJo, day and night, all year round." Being an entrepreneur, clearly, takes determination. "You will never reach the top of the mountain,"Tenison says. "When you are ambitious the peak keeps getting higher and is always just out of reach. The trick is just to enjoy the climb."
A business that runs itself
Sanjana Karnani began selling vitamins and beauty products via online retailer Amazon in 2013 to earn a little extra money on the side. "I just wanted to sell a few units and make a bit of money to buy coffee," she tells The Times. Just three years on, her company, Verdure Plus, is shifting 10,000 units a month with sales of over £1m a year.
Karnani has left her job at a charity, but says that running Verdure Plus takes up hardly any time. She has just returned from holiday and usually takes six to eight weeks off each year, 4,000 miles away in India. No one mans the business when Karnani is away. No one needs to. The company is almost fully automated. Karnani uses Amazon's automatic order and delivery service, which handles sales without her. "All I need to do is make sure I leave enough stock in the warehouse."
Amazon has also lent Karnani money to buy extra stock, boosting both her business and its own."More money means more products," she says. "I then sell more, which keeps my suppliers happy, and they offer me better deals because I can afford to pay upfront." Amazon doesn't disclose how much it lends to small businesses in the UK operatingon its website, but says it has lent more than $1.5bn to small ventures around the world, with outstanding total loans of $400m to thousands of customers. "Buying power in a small business," Karnani says, "can make everything fall into place."
Bnaking on romance
Rachel MacLynn, 37, runs a dating agency for bankers. Her company, Vida, has offices in Mayfair and clients at Barclays and Goldman Sachs. "Name the bank, and we've set them up with someone," MacLynn tells Business Insider. More than half her clients are men. For an annual fee of £9,000, she arranges ten dates a year, which she calls "introductions". Before each meeting, clients can flick through portfolios for a match and, if everything goes well, they can freeze their fees until the relationship ends. "They usually find their partner at number five or six." MacLynn, who was previously a business psychologist, set up Vida in 2011; today the firm employs seven full-time matchmakers. Many bankers want a partner outside of finance, she says, targeting people "in a creative industry, like fashion or marketing". Some are painfully specific. One client insisted their partner should be an architect with children between the age of seven and 12. They even "specified the postcodes". Vida also has an international division. "Bankers in US firms are totally in awe of European women... The whole bilingual thing is like catnip to them."