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5 Things Behind the Day of Action on Insulin Pricing


The "Day of Action" seeks to unite people with diabetes online and asks them to contact their representatives. Fixing the insulin pricing system in the United States will be difficult-even experts say it's very complex.

People with diabetes are taking to social media Friday, September 8, 2017, and heading to downtown Indianapolis, Indiana, on Saturday in what could be the most visible actions to date over the cost of insulin, an issue that is now gaining more attention in the mainstream press.

The online “Day of Action,” which links followers with the hashtag #insulin4all, will also ask supporters to contact their elected representatives. It will be followed by Saturday's demonstration outside the headquarters of Eli Lilly. While all 3 major insulin manufacturers—Lilly, Sanofi, and Novo Nordisk—were sued in a class-action lawsuit early this year, patient groups have focused on Lilly over what they say are the long-term price increases of Lilly’s fast-acting Humalog, which has gone up more than 1000% in 20 years. Lilly was criticized for a recent round of increases in May, when Humalog’s price rose 7.8%.

But even doctors who are fed up on behalf of their patients say the story behind high insulin prices is exceedingly complex. Experts have a hard time explaining why the same vial of insulin costs $250 in the United States but $12 in India. The rise of pharmacy benefit managers (PBMs) and their role in drug pricing is getting scrutiny, as is the relative lack of competition in development of new insulins, which was explored in a 2015 study in JAMA Internal Medicine.

Here are 5 things to know about what is happening now in the fight over insulin prices:

1. Benefit designs are part of the problem

It’s not just price increases—it’s also the rise of high-deductible plans that are creating challenges for people who use insulin, especially those with type 1 diabetes (T1D) who can’t live without it. Another group adversely affected are Medicare patients with type 2 diabetes (T2D) who hit the coverage gap, or “doughnut hole.” Because insulin may be new to these seniors, they may cut back on doses or try to avoid using insulin completely, at the expense of glycemic control.

2. There’s plenty of finger-pointing

Manufacturers insist few patients pay the list price due to discounts and rebates arranged with PBMs, and that support programs are available for the truly needy. But advocates like Irl B. Hirsch, MD, of the University of Washington have said for those patients who must pay out of pocket, the current situation creates hardships. Endocrinologist David M. Tridgell, MD, of Park Nicollet Health Partners in Minnesota, wrote in The Washington Post of a patient who developed diabetic ketoacidosis because he lost his insurance and couldn’t afford $600 for 2 vials a month.

3. The new buzzword: transparency

The American Diabetes Association has collected more than 250,000 signatures calling for ending the secrecy around the PBM discount system. Nevada Governor Brian Sandoval, a Republican, signed an insulin pricing transparency law earlier this summer, but on September 1, 2017, the Pharmaceutical Research and Manufacturers of America (PhRMA) and Biotechnology Innovation Organization (BIO) sought an injunction saying the new law violated manufacturers’ rights under federal patent law.

4. Pharma is in transition

Pressure from patients, payers, and even Congress is having an effect on pharmaceutical companies, as is the cost of research and development. On Thursday, Lilly announced it would cut 8% of its workforce, or about 3500 positions worldwide. A report in Reuters did not cite pressure on insulin prices per se, but instead cited delays in development of a drug for rheumatoid arthritis and the failure of a trial for a highly anticipated Alzheimer’s drug.

In its second quarter report August 1, 2017, Sanofi announced that diabetes and cardiovascular sales were down 15% and diabetes franchise sales were down 12.2%. The diabetes sales and marketing unit took a 20% cut in December 2016. Novo Nordisk also cut about 2% of its workforce in 2016 amid payer pressure, saying it would focus on “innovative” drugs.

5. Here come the biosimilars

The arrival of biosimilar or “follow-on” versions of mainstay insulins promise not only price competition but, as Sanofi has already seen, the possibility of seeing a best-seller replaced on formulary. First, Lilly and Boehringer Ingelheim introduced Basalgar U-100 insulin glargine, the follow-on for Lantus. Then just last week, Sanofi returned the favor by announcing tentative FDA approval for its follow-on of a rapid-acting insulin lispro injection, the follow-on of Lilly’s Humalog. The follow-on is already approved in Europe. Tentative approval means that unresolved patent issues remain.

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