Robin Feldman Professor Of Law Uc Hastings College Of Law San Francisco
Insulin is a very old drug. We’ve known about it for a long time. Patients shouldnt be paying through the nose for it now a hundred years later.
State laws allow pharmacists to automatically substitute a generic version for drugs, but that automatic substitution is not available for biosimilars unless certain conditions are met.
Its a huge impact, says Feldman. Because automatic substitution is the way that generic drugs traditionally make inroads in the market and bring prices down.
The FDA approved a long-acting biosimilar insulin called Semglee in July 2021. However, patients and physicians must specifically request the biosimilar because of the lack of automatic substitution. Feldman says that historically, that doesnt happen.
Additionally, intermediaries along the insulin supply-chain can drive up costs or keep new drugs from gaining a foothold. Existing players with large market share can use volume discounts to discourage and health plans from covering the new entrant, says Feldman.
The bottom line is that the three-company monopoly is hurting people with diabetes. Insulin is a very old drug, says Feldman. We’ve known about it for a long time. Patients shouldnt be paying through the nose for it now a hundred years later.
How Much Does Insulin Cost Heres How 28 Brands And Generics Compare
Key takeaways:
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GoodRx research shows that the average retail price for insulin rose 54% from 2014 to 2019.
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As millions of Americans struggle to afford basic household needs during COVID-19, those prices have decreased only about 5% from January 2020 to October 2021.
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While the Biden administration, manufacturers, states, and insurers have responded with efforts to curb insulin prices, FDA approvals of generics and biosimilars have largely driven the downward trend in overall cash prices.
Hanie Redmond Pharmd Cde Bc
Without a doubt, insulin is lifesaving, and just a day or so without it will require hospitalization and could lead to death for those patients.
If someone has type 1 diabetes or if someone has had damage to their pancreas, these are instances where their body doesnt produce any insulin, Stephanie Redmond, PharmD, CDE, BC-ADM, founder of Diabetes Doctor, tells Verywell. Without a doubt, insulin is lifesaving, and just a day or so without it will require hospitalization and could lead to death for those patients.
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Explainer: Why Is Insulin So Expensive And Difficult To Cap
Washington Reining in the soaring prices of insulin has thus far been elusive in Congress, although Democrats say theyll try again as part of their economic package that focuses on health and climate.
The price of the 100-year-old drug has more than tripled in the last two decades, forcing the nations diabetics to pay thousands of dollars a year for the life-saving medication. Democrats are considering capping the cost of that drug for at least some, although its unclear what the final proposal will look like and how many insulin users will get a price break.
Heres a look at how insulin became so expensive and why its so difficult to bring the price of the drug down.
HOW MANY PEOPLE IN THE U.S. USE INSULIN AND FOR WHAT?
Roughly 8.4 million Americans use insulin, according to the American Diabetes Association. Not everyone who has diabetes needs insulin, but for those who do, its an important medication. For more than 1 million of those people with type 1 diabetes, regular access to the medication is a necessity and they will die without it.
People require insulin, its not an option and nobody should have to decide between life-sustaining medication or food and rent, said Dr. Robert Gabbay, the chief scientific and medical officer for the American Diabetes Association.
HOW EXPENSIVE IS INSULIN?
The price varies.
The cost has led some to use less insulin than their doctor prescribes or postpone paying for other medical care.
WHY IS INSULIN SO EXPENSIVE?
What Are The Solutions
According to the American Diabetes Association , there are more than seven million diabetics in this country, and around 27% say that affording insulin has impacted their daily life.
Dr William Cefalu, the ADA’s chief scientific, medical and mission officer, says a lack of transparency is at the root of the issue.
“The system is dysfunctional. There are issues at each level, at each stakeholder in the insulin supply chain,” he says. “We can’t point the finger at one particular entity.”
Fixing issues with high deductibles and ensuring any discounts negotiated with insurance companies actually filter down to patients is key, he says.
Competition would be the best way to bring prices down, so why hasn’t that happened yet?
Unlike chemical drugs, which can be simply replicated, insulin is a biological material – made up of proteins synthesised through a cell line that’s unique to each formula.
But despite these fundamental differences, insulin has long been classified and regulated like a chemical drug.
In December, the FDA announced that the agency would reclassify insulin as a “biological product” by 2020, in what the FDA commissioner called a “watershed moment for insulin”.
These so-called biologics will then have an easier pathway to approval than before, promoting the development of “products that are biosimilar to, or interchangeable with” existing insulin.
For Ms Marston, it’s hard to see why insulin was ever treated like other medications.
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No Regulation Of Drug Prices
The last main factor that contributes to drug prices being so high is the U.S. government, which does not regulate drug prices. Medicare is not allowed to negotiate drug prices, and there is no single-payer healthcare system to push prices down. While there is legislation in the works to cap insulin costs, nothing yet has been put into effect on a national level.
In addition, drug makers spend a huge amount of money on advertising, something thats not allowed in other developed countries.
The numbers are staggering and only getting worse. A solution must be found to this growing crisis that is putting Americas diabetic population at dire risk.
Affordable And Safe Prescription Drug Importation Act
Cities, counties, school districts and everyday consumers are not the only ones taking a stance on importation of prescription drugs.
The bill includes specific requirements to ensure the safety of imported drugs. Provisions include:
- FDA certification of foreign sellers
- a clear definition of what drugs may be imported
- supply chain security requirements
Senators and state representatives are proposing and supporting legislation that would lower the cost of prescription drugs by allowing Americans to import safe, low-cost medicine from Canada.
In February 2017, Sens. Bernie Sanders , Cory Booker and Bob Casey introduced the Affordable and Safe Prescription Importation Act.
The legislation would instruct the secretary of Health and Human Services to put forward regulations allowing wholesalers, pharmacies and individuals to import qualifying prescription drugs from licensed Canadian sellers.
It would also grant the secretary authority in two years to permit importation from countries in the Organisation for Economic Co-operation and Development that have standards for the approval and sale of prescription drugs that are comparable to those in the U.S.
Reps. Elijah E. Cummings and Lloyd Doggett introduced a companion bill in the House.
The new legislation would also target rogue online pharmacies a major concern among Americans who may consider getting their drugs from outside the U.S.
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Ban On Federal Negotiation
- Require a valid prescription
- Provide a physical address in the U.S.
- Are licensed by the state board of pharmacy in your state and the state where the pharmacy is operating
- Have a state-licensed pharmacist to answer your questions
Levitt noted that most medication sold in America is imported from other countries.
If we can do that safely it begs the question why people are saying we cant import low-cost medications safely, he said. The argument against it is often hyperbolic claims about unsafe drugs.
Insulin Cost And Pricing Trends
Tara O’Neill Hayes, Josee Farmer
Executive Summary
- Diabetes cost the United States $327 billion in 2017, becoming the most expensive chronic disease in the nation.
- Insulin costs, before accounting for any rebates or discounts, comprise an estimated $48 billion of the direct costs of treating diabetes after rebates, insulin accounts for 6.3 percent of costs.
- The average list price of insulin increased 11 percent annually from 2001 to 2018, with average annual per capita insulin costs now nearing $6,000. Because patients out-of-pocket costs are typically based on list price, their expenses have risen substantially despite the decrease in net price for many of the most commonly used insulin products over the past several years.
- If the trends of the past decade continue, gross insulin costs in the United States could reach $121.2 billion in total spending by 2024, but if more recent trends of much slower price growth prevail, insulin spending could total $60.7 billion in 2024 .
The Rising Cost of Diabetes
Given the rising costs, it is worth understanding what is driving these increases. This analysis first details increases in insulin prices and offers a projection for how much insulin will cost in the coming years. It then examines what is driving these increases.
The Price of Insulin
Past Price Growth
Insulin Spending in Medicaid
Source: American Medical Association
Insulin Spending in Medicare Part D
Typical Insulin Spending per Patient
Estimating Future Costs
Rebates
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How Us Drug Prices Compare
In Canada and other developed countries, the same prescription drugs manufactured in the same factories, by the same companies are available for a fraction of the price compared to in the U.S.
In fact, Americans spent $1,112 per person on prescription drugs in 2014, according to the Organisation for Economic Co-operation and Development. Canadians, on the other hand, spent $772 over the same year.
The drug prices in the U.S. for the exact same drugs are often exponentially higher than they are in Canada and in every other country, said Gabriel Levitt, president of PharmacyChecker.com, a company that verifies overseas pharmacies and compares prices for different drugs. The savings that Americans can get right now can average about 70 percent when you look at the lowest prices in Canada versus prices that Americans pay at local pharmacies here.
Whats more, a PharmacyChecker.com analysis found 70 percent of the most popular, non-controlled, brand name drugs sold in the U.S. are manufactured outside the U.S., then imported and sold to Americans at a higher price compared to patients in other countries.
If you have been affected by a dangerous drug or medical device, call now.
Take Nexium, for example. AstraZeneca manufactures the stomach-acid drug in Sweden and sells it to consumers in the U.S., Canada, U.K., Australia, New Zealand, India and Turkey.
This is mostly for brand name drugs, Levitt said. The prices on these drugs are just much higher here.
Cost Of Insulin By Country 2022
Insulin is a hormone, made by the pancreas, which enables the body’s cells to absorb sugar from the bloodstream and consume it for energy. However, in roughly 10% of the world’s population (see Diabetes Rates by Country, the body’s ability to produce and utilize insulin is disrupted, resulting in a chronic condition known as diabetes. There are two main forms of diabetes: Type 1, in which the pancreas fails to produce enough insulin and type 2, in which the pancreas makes enough insulin but the cells can’t process it effectively. Diabetes is a serious condition. Without adequate insulin, the body becomes unable to manage its blood sugar level, which can lead to a host of medical complicationsin fact, according to the International Diabetes Foundation, diabetes caused 6.7 million deaths in 2021.
Fortunately, type 1 diabetes is usually treatable with the use of man-made insulin, which can be administered via a syringe or pen, an inhaler, or a surgically attached pump. Unfortunately, insulin prices have skyrocketed in the United States over the past two decades and continue to rise. For example, the American Journal of Managed Care pointed out that the cost of a one-month supply of the insulin Humalog cost $21 in 1996, but $275 in 2019a 1200% increasebut actual inflation during that same period was only 63.67%.
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A Global Comparison Of Insulin Prices
The affordability and accessibility of insulin is a topic of broad public interest for several factors, not the least of which is the absolute need for insulin in persons with diabetes who might otherwise die without treatment. The relative number of patients with diabetes globally, and the amount of money government programs, commercial plan sponsors, and patients expend on diabetic medicines such as insulin has also generated significant interest in insulin prices. To date, research has broadly found that insulin prices vary considerably within the global market, with some countries paying significantly more per unit of insulin than others, sometimes for the same medication.
This study expands on prior research into insulin prices by providing detailed insulin price comparisons across the globe. It presents insulin price variability on a per-insulin-package basis and measures insulin affordability relative to a countrys individual measures of economic wealth namely, median annual income, average annual income, and gross domestic product per capita. This research examined insulin prices at retail pharmacies, the total package price of insulin as well as the patient cost to obtain the package, in 20 countries of varying economic status. In so doing, the goal of this research is to provide greater context and transparency into insulin pricing and affordability.
This study was requested by, and fully funded from, the McPike-Zima Foundation.
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But her relief soon turned to aggravation. Even if she had flown from her home in Philadelphia, buying insulin across the border would have saved her money.
“I was angry that I had to go to Mexico in the first place to get a drug that keeps me alive. I live right next to a , yet had to travel 3,000 miles to another country to get affordable insulin.”
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Why Insulin Remains Unaffordable
But why does insulin a medication thats been around for more than 100 years remain unaffordable for many people in the U.S.?
The high cost can be attributed in part to evergreening, a process in which drug companies make incremental improvements to their products that can extend the life of their patents, said Dr. Kevin Riggs, a physician at the University of Alabama at Birmingham Heersink School of Medicine. He co-wrote a study published in the New England Journal of Medicine in 2015 that described the century-long history of the drug.
The improvements may include tinkering with a molecule or changing the delivery system, such as using insulin pens instead of vials.
Extending patentscan discouragegeneric drugs from being developed, Riggs said, allowing drugmakers with exclusive rights to their insulin to charge whatever the market will bear. And as supply chains have become more complicated over the years, costs have ballooned.
And so that means those prices have gone up crazy, he said.
And even when the patents do expire as many have Riggs said that the large investment it takes to get insulin manufactured and approved by U.S. regulators may make the venture less appealing to generic drugmakers.
Eric Tichy, division chair of pharmacy supply solutions for the Mayo Clinic in Rochester, Minnesota, agreed, saying the barrier to entry to produce insulin is pretty high.
No one should be “forced to make the decision between life or death,” she said.
Insulin Prices Around The World
In contrast to the staggeringly expensive insulin pricing in the United States, prices in low- and middle-income nations and developing countries are often comparable.
Additional stress is placed on people with diabetes due to the unreliability of insulin and related supplies, such as test strips and other supplies.
T1 International, a non-profit organization, surveys persons with type 1 diabetes biannually all over the globe about their out-of-pocket expenses. The following table lists the five most costly nations for each kind of insulin studied. All prices are per vial of insulin in U.S. dollars.
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Diabetes Costs In Specific Populations
- Most of the cost for diabetes care in the U.S., 67.3%, is provided by government insurance . The rest is paid for by private insurance or by the uninsured .
- People with diabetes who do not have health insurance have 60% fewer physician office visits and are prescribed 52% fewer medications than people with insurance coveragebut they also have 168% more emergency department visits than people who have insurance.
- Total per-capita health care expenditures are higher among men than women .
- Total per-capita health care expenditures are lower among Hispanics and higher among non-Hispanic Blacks and among non-Hispanic whites .
- Compared to non-Hispanic whites, per capita hospital inpatient costs are 23% higher among non-Hispanic Blacks and 29% lower among Hispanics. Non-Hispanic blacks also have 65% more emergency department visits than the population with diabetes as a whole.
- Among states, California has the largest population with diabetes and thus the highest costs, at $39.47 billion. Texas , Florida , and New York round out the top four states in terms of total annual cost.
Us Prices Compared With Those In 32 Other Oecd Countries
RAND used prescription-drug market data from IQVIA’s MIDAS database for 2018 and compared the US data to those of 32 countries in the Organization for Economic Co-operation and Development .
These countries are Australia, Austria, Belgium, Canada, Chile, the Czech Republic, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, Switzerland, Turkey, and the United Kingdom.
The average US manufacturer price per standard unit for all insulins was $98.70, compared with $6.94 in Australia, $12 in Canada, $7.52 in the United Kingdom, and $8.81 for all 32 non-US countries.
Average prices in the United States were highest for rapid-acting insulins and lowest for intermediate-acting insulins . In the United States, the average manufacturer price per standard unit for human insulin was $85.21, compared to $7.11 in Canada and $5.13 in the United Kingdom.
The United States consumes more insulin and accounts for more sales than the other nations, with 32% of volume and 84% of sales. The next-closest nation is Germany, which accounted for 12% of volume and 3% of sales. Analogue insulin accounts for 91% of US volume and 92% of sales.
The RAND authors note that nonprescription insulins may be less expensive.
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