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What’s at the root of the insulin cost crisis?

Insulin is a lifesaving drug for millions, but its skyrocketing costs over the past decade have left diabetes patients struggling.

For the 7.4 million American children and adults with diabetes who use it, insulin is as essential to their survival as food and water.  

Although this lifesaving drug has been in use for 100 years – almost all of that time at a low cost to diabetes patients – the price of insulin has tripled over the past decade alone. For people with high-deductible insurance plans, no insurance at all, or who are facing a coverage gap through Medicare, out-of-pocket costs of $400 or more per month have become common.  

High insulin costs have led to life-threatening choices for many. According to a recent study by Yale University, one in four people with diabetes in America have cut back on their insulin use, either reducing or skipping doses because of affordability issues. Some patients have had to decide between paying for insulin or paying for basic needs like food and housing; some have died after attempting to ration their doses.

Patients and politicians alike are demanding that immediate action be taken to solve this crisis. But the solutions are still the subject of debate between drugmakers, lawmakers and insurance companies.

Dr. William Cefalu, the American Diabetes Association’s chief scientific, medical and mission officer, has cited a lack of transparency as a root cause of the problem. “The system is dysfunctional. There are issues at each level, at each stakeholder in the insulin supply chain,” Cefalu said. “We can’t point the finger at one particular entity.”

Another central problem is the nature of insulin itself, and the way it has traditionally been regulated. 

Unlike chemical drugs, which can simply be copied, insulin is a biologic drug, made of proteins from living cells. Despite its differences, however, insulin has long been classified and regulated like a chemical drug. 

The three companies which control 90% of the U.S. insulin market – Novo Nordisk, Sanofi Aventis and Eli Lilly – each make insulins that are slightly different. Under current regulations, no generic or unbranded versions of their products can be marketed without accessing those companies’ patented materials and processes. 

In December of 2018, the FDA announced that the agency would reclassify insulin as a “biological product” by 2020, in what then- FDA Commissioner Scott Gottlieb called a “watershed moment for insulin.” After that time, other biologic medicines will have an easier path to approval, promoting the development of competing products that are “biosimilar to, or interchangeable with” existing insulin drugs, according to the FDA.

In April, just prior to his resignation as commissioner, Gottlieb issued a statement regarding the FDA’s continued commitment to making affordable insulin available to everyone who needs it.  “While the regulatory transition of insulin products nears, we’re cognizant of the fact that it won’t be soon enough for the millions of Americans who struggle to pay for their insulin today,” Gottlieb said. “Helping to ensure patients have access to the critical drugs is a responsibility shared by all stakeholders, including manufacturers and health plans. We all need to do our part.

“American patients who rely on insulin to live deserve to have high-quality, affordable options… We hope our industry partners will join us in doing all we can to help people who need access to the life-saving medicines, now.”

Some companies are beginning to take steps to respond to the crisis. Major health insurer Cigna and its pharmacy arm, Express Scripts, announced in April that its insured members will pay no more than $25 for a 30-day supply of insulin beginning later this year, even before they meet their annual deductibles. These discounts could benefit about 700,000 of its patients who use insulin. 

Drugmaker Sanofi also announced this spring that it will offer its insulin products at $99 per month for uninsured patients, and Eli Lilly announced its plans to release a half-price alternative to Humalog, its most popular short-acting insulin product. 

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