Blood production is a tightly regulated process, and disturbances can pose a severe risk to human health. Polycythemia vera (PV) is an example of such a disorder characterized by excessive production of erythrocytes and the presence of the JAK2V617F mutation. A 5D PV model with competing healthy and malignant cells, including erythropoietin (EPO), is proposed and analyzed. The production of EPO is governed by the number of erythrocytes, while EPO influences the proliferation and death rate of erythrocytes. Stem cell dynamics can be independently analyzed as a two‐dimensional system. A numerical analysis shows that steady states and their stability of the 2D stem cell PV submodel are in agreement with the PV model. Combining the model with data of PV patients, we demonstrate the model's prognostic significance. It follows that an efficient treatment must target stem cell properties such as the bone marrow microenvironment and stem cell death rates.