CSRXP: INSULIN ACT MAY PROVIDE SHORT TERM RELIEF FOR SOME PATIENTS BUT WON’T ADDRESS ROOT CAUSE OF OUT-OF-CONTROL DRUG PRICES
Congress Must Advance Bipartisan, Market-Based Solutions to Hold Big Pharma Accountable for Egregious Anti-Competitive and Pricing Practices to Lower Rx Prices
For Immediate Release
Contact: Jon Conradi
Washington, D.C. – The Campaign for Sustainable Rx Pricing (CSRxP) released a statement today on the Improving Needed Safeguards for Users of Lifesaving Insulin Now (INSULIN) Act.
“CSRxP appreciates Senators Shaheen and Collins for their commitment to addressing out-of-control prescription drug prices and agrees Congress must take urgent action to deliver relief for Americans who face financial uncertainty affording their medications, especially those who rely on insulin to survive,” said CSRxP executive director Lauren Aronson. “This bill could help make insulin more affordable for some patients in the short term, but CSRxP has concerns with any legislation that caps out-of-pocket costs without holding Big Pharma accountable for the industry’s egregious practices that are the root cause of out-of-control drug prices.”
“Big Pharma’s abuse of the insulin market is just one example of how the industry games the system to keep drug prices high at the expense of American patients and taxpayers,” Aronson added. “In January of this year alone, brand name drug companies hiked prices on nearly 800 medications by an average of five percent, including for serious conditions like cancer, blood diseases, HIV and more.”
“To provide lasting relief for consumers and the U.S. health care system, lawmakers must pair measures to deliver relief at the pharmacy counter with bipartisan, market-based solutions to address Big Pharma’s egregious pricing practices and anti-competitive tactics,” Aronson said.
Big Pharma has repeatedly hiked insulin prices at rates far out-pacing inflation, despite little or no improvement to the life-saving drug. Between 1996 and 2006, the price of insulin increased by 700 percent. And in 2016, the average price per month reached $450, leaving one-in-four American patients prescribed this medication struggling to afford it.
As a U.S. Senate Finance Committee report revealed last year, three companies – Novo Nordisk, Sanofi And Eli Lilly – control 99 percent of the marketplace and have worked in “lockstep” to limit competition and increase prices:
- Over The Past Decade, The Three Largest Manufacturers Of Insulin – Novo Nordisk, Sanofi And Eli Lilly – “Aggressively Raised The List Price Of Their Insulin Products Absent Significant Advances In The Efficacy Of The Drugs.” “Sanofi’s long-acting insulin pens, Lantus SoloStar, increased from $303 in 2014 to $404 in 2019. The WAC price of Novo Nordisk’s long-acting insulin pens, Levemir FlexTouch, increased from $303 in May 2014 to approximately $462 in January 2019, representing an increase of $159—or 52%— in a little more than five years. Eli Lilly’s rapid-acting insulin, Humalog 50-50 Kwikpen, had a WAC of $530 in 2017 compared to $323 in 2013—an increase of $207 or 64% in four years. Sanofi’s rapid acting insulin, Apidra Solostar, also increased—from $302 in 2014 to $521 in 2019— while Novo Nordisk’s rapid-acting insulin, Novolog FlexPen, rose from $324 in 2013 to $558 in 2018, representing a more than 70% WAC price hike for both companies during this time period.” (Staff Report, “Insulin: Examining The Factors Driving The Rising Cost Of A Century Old Drug,” United States Senate Finance Committee, 1/14/21)
- Sanofi Aggressively Increased Its List Price Between 2012 And 2014 In Response To Market Pressure And Competition. “From 2001 to 2012, Sanofi increased list price as much as 18% annually, raising its price from $34 to $131 by the end of 2012. However, in 2013 and 2014, Sanofi embarked on much more aggressive increases, nearly doubling the drug’s WAC to $248 by the end of 2014.” (Staff Report, “Insulin: Examining The Factors Driving The Rising Cost Of A Century Old Drug,” United States Senate Finance Committee, 1/14/21)
- “Novo Nordisk And Sanofi Not Only Closely Monitored The Others’ Price Increases, They Actually Increased Prices In Lockstep—Sometimes Within Hours Or Days Of Each Other—A Practice Known As ‘Shadow Pricing.’” “Rather than seeking to undercut its competitors’ pricing, from 2014 on Novo Nordisk engaged in a cat-and-mouse strategy of pricing that followed Sanofi’s price increases closely, sometimes mirroring them within days or even hours. In 2015, Novo Nordisk changed its pricing strategy in advance of launching Tresiba, its next generation basal insulin (also known as long-acting insulin). Instead of following Sanofi, it led with a list price increase in order to set a high basal insulin price floor from which to launch Tresiba’s initial list price. However, in 2017 and 2018, Novo Nordisk resumed increasing its list price to respond to Sanofi’s pricing actions. According to internal memoranda, on October 1, 2017, Sanofi increased Lantus’s list price by 3% and Toujeo’s list price by 5.4%. Roughly three weeks later, Novo Nordisk recommended that the company make a 4% list price increase on January 1, 2018 in response to Sanofi, which was approved as recommended on November 3, 2017. Novo Nordisk would make at least one more list price increase in response to Sanofi in 2018.” (Staff Report, “Insulin: Examining The Factors Driving The Rising Cost Of A Century Old Drug,” United States Senate Finance Committee, 1/14/21)
- Spending On Insulin Products Has Increased Significantly For The Medicare Program And Its Beneficiaries. “Based on data collected from CMS, annual spending on insulin has increased by billions of dollars over the last decade. Between 2010 and 2018, Medicare Part D spent $78.4 billion on insulin, prior to rebates, the majority of which was spent on Lantus ($27.4 billion), Novolog ($16.5 billion), Humalog ($12.3 billion), and Levemir ($11 billion). The growth of CMS’s pre-rebate spending on insulin also significantly outstripped the growth rate of beneficiaries utilizing insulin from 2010 to 2018. For instance, the number of Part D beneficiaries using insulin increased 51%, from over 2.1 million in 2010 to approximately 3.2 million in 2017, whereas spending on insulin prior to rebates increased more than 470%, from over $3 billion in 2010 to roughly $14.3 billion in 2018.” (Staff Report, “Insulin: Examining The Factors Driving The Rising Cost Of A Century Old Drug,” United States Senate Finance Committee, 1/14/21)
- Insulin R&D Spending Was A Fraction Of Manufacturers’ Revenue And Sales And Marketing Expenses. “Eli Lilly reported spending $395 million on R&D costs for Humalog, Humulin, and Basaglar between 2014 and 2018, during which time the company spent nearly $1.5 billion on sales and marketing expenses for its insulins. These three drugs generated $22.4 billion in revenue during that period. Similarly, Sanofi reported net sales of nearly €31 billion (approximately $37 billion based on current currency conversion rates)5 between 2014 and 2018 for its five insulin products, during which time the company reported spending $902 million on insulin R&D. Novo Nordisk failed to provide requested R&D spending information to the Committee.” (Staff Report, “Insulin: Examining The Factors Driving The Rising Cost Of A Century Old Drug,” United States Senate Finance Committee, 1/14/21)
Read more on Big Pharma’s lead role in increasing insulin prices HERE.
Read more on actions being taken by others in the supply chain to make insulin more affordable HERE.
Read more on bipartisan, market-based solutions to hold Big Pharma accountable HERE.