Pharmaceutical behemoth Eli Lilly will lower the cost of its popular insulin products and ease some of the financial burden for millions of Americans with diabetes.
The big change comes amid decades of criticism from Democrats and patient advocates who accuse the pharmaceutical industry of unfairly inflating prices, forcing millions of diabetics to spend thousands of dollars a year on the life-sustaining medication.
The company said Tuesday it will cut the prices of its Humalog and Humulin injections, its two best-selling insulin products, by 70 percent in the fourth quarter.
And starting May 1, the company is lowering the list price of unbranded insulin from $82 per vial to $25 per vial — the lowest price for insulin taken during meals and less than the price of a Humalog vial in 1999.
By imposing a cost cap, Eli Lilly is making insulin products, which can cost uninsured people thousands of dollars a year, more accessible to the approximately 21 million Americans under age 65 with diabetes.
Humulin is the injectable form of insulin made by Eli Lilly. The cost of a single vial is capped at $35 for diabetics with private insurance
In 2022, Trulicity, a drug used to treat type 2 diabetes, was Lilly’s top earner, generating approximately $7.4 million in profits
Lilly will also limit the cost of insulin to $35 per month for diabetics with private insurance at select pharmacies. The cost cap, which takes effect immediately, was previously only for people enrolled in Medicare, the government’s health care plan for seniors.
The cost limit only applies to people with commercial insurance, but Lilly said people without insurance can continue to limit monthly costs for their insulin products to $35 by using a savings card that can be downloaded online.
Mr. David A. Ricks, Lilly’s CEO, said: ‘While the current health care system gives most people with diabetes access to insulin, it still doesn’t provide affordable insulin for everyone and that needs to change.
“The aggressive price cuts we are announcing today should really make a difference for Americans with diabetes. Because these price reductions take time for the insurance and pharmacy system to implement, we are taking the extra step of immediately limiting out-of-pocket costs for patients taking Lilly insulin who are not covered by the recent Medicare Part D cap. ‘
Most diabetics need two to three vials of insulin per month, although some may need more. With an average list price of about $100 per vial, the cost of controlling blood sugar can be prohibitive, forcing many people to turn to the black market or ration the critical drug, with disastrous results.
The US is a global outlier when it comes to money spent on the drug, which costs between $2.28 and $3.42 to manufacture. In the UK, a bottle costs about $7.50while in Canada it costs $12 per vial.
When Canadian scientist Frederick Banting discovered insulin in the 1920s, he chose not to put his name on the patent because he felt it was unethical for a physician to benefit from the life-saving medication.
James Collip and Charles Best, co-inventors of Dr. Banting, eventually sold the patent to the University of Toronto for just $1 in an effort to make insulin widely accessible.
But that only encouraged drug companies to demand more money for it. Leading manufacturers have increased list prices by 600 percent in the past two decades.
The pharmaceutical giants that make insulin have filed patent after patent in the US to keep a grip on their corner of the market. There are very few generic insulins, although companies have made biosimilar insulins, which are very similar to and have no clinically meaningful differences from the original biologic, in this case human insulin.
Meanwhile, Americans traveling to Canada can get insulin for about $35 per vial. And a growing number of desperate Americans are turning to our northern neighbors, sometimes by busloads, to get their hands on it.
This is because, unlike the US, the Canadian government has imposed price controls on the pharmaceutical industry.
However, the US government has recently taken steps to curb skyrocketing prices.
Last year’s Inflation Reduction Act capped insulin prices for Medicare beneficiaries at $35 per month.
The final product came up short according to Democrats who wanted the limit extended to the private market as well.
President Joe Biden called on Congress to apply the limit to all Americans, which Republicans cut out of the Inflation Reduction Act in the final stages of deliberation.