WHY IS INSULIN SO EXPENSIVE. WHAT YOU CAN DO TO REDUCE IT'S COST!!!

Hi today we are going to discuss “why insulin is so expensive?”

When inventor Frederick Banting discovered insulin in 1923, he refused to put his name on the patent. He felt it was unethical for a doctor to profit from a discovery that would save lives. Banting’s co-inventors, James Collip and Charles Best, sold the insulin patent to the University of Toronto for a mere $1. They wanted everyone who needed their medication to be able to afford it. Their drug, which many of the 30 million Americans with diabetes rely on, has become the poster child for pharmaceutical price gouging.

The cost of the four most popular types of insulin has tripled over the past decade, and the out-of-pocket prescription costs patients now face have doubled. 

Insulin is a widely sold drug of which most forms are now off-patent, so why it is incredibly expensive? 

Some of the reasons are:

1. Only 3 Companies Control 90% of the Global Insulin Market

The ‘big three’ insulin producers – Eli Lilly, Novo Nordisk and Sanofi – dominate more than 90% of the world insulin market by value. Often only one of these companies supplies insulin in a country, which means they more or less hold a monopoly there and can set prices as they wish. In some countries, notably China and India, there are domestic insulin companies that can help drive down the price. This means we need more companies in markets like the USA to help bring prices down.

2. No Generic Insulin

When it comes to the question of generic insulin, we are faced with another complicated issue. Insulin is a therapeutic biological product (or 'biologic'), rather than a chemically synthesized molecule. This means it cannot be made as generic in the same way as other drugs. Creating what is called a biosimilar is a lot more complicated and expensive than just duplicating a chemical molecule. There is little market incentive to produce biosimiliars because it costs nearly as much as making new drug, and companies must go through all the approval stages and trials that a new drug is required to go through. Not to mention, current biosimilar insulins on the market – primarily produced by the ‘big three’ – have only reduced the price by about 10-15%.

3. Pay-for-Delay Schemes & Lawsuits

A ‘Pay for delay’ agreement is a patent dispute settlement in which a generic (in the case of insulin, a biosimilar) manufacturer acknowledges the original patent of a pharmaceutical company and agrees to refrain from marketing its product for a specific period of time. In return, the company receives a payment from the patent-holder. This means it is actually legal for one insulin producer to pay another one not to enter the market. If Pay for delay schemes don’t work, the ‘big three’ can still sue other players, prolonging processes and pushing players out of the market because of legal fees and time-wasting. All of these are win-wins for companies, and lose-lose for patients.

4. Patents

Why aren’t we seeing more companies making insulin? There are many reasons for this, but patent evergreening is a big one. Patents give a person or organization a monopoly on a particular invention for a specific period of time. In the USA, it is generally 20 years. Humalog, Lantus and other previous generation insulins are now off patent, as are even older animal based insulins. So what’s going on? Pharmaceutical companies take advantage of loopholes in the U.S. patent system to build thickets of patents around their drugs which will make them last much longer (evergreening). This prevents competition and can keep prices high for decades. Recently found that Sanofi, the maker of Lantus, is no exception. Sanofi has filed 74 patent applications on Lantus alone, that means Sanofi has created the potential for a competition-free monopoly for 37 years.

5. Politics

Companies are not in the habit of throwing money away, and they are not in the habit of staying out of politics. Eli Lilly, Novo Nordisk, and Sanofi collectively rake in several billions of dollars in profits. That’s not millions, but billions. We know they spend millions on marketing, but they also spend millions on lobbying politicians and donating to our decision-makers so that they keep quiet about price gouging. Chances are, they do. Not to mention, the revolving door between pharma companies and US Government positions. Our current secretary of Health and Human Services was previously an Eli Lilly executive. Obviously, his interests are not with people, but with power. This is why independent patient voices are so important.

6. Pharma Marketing Schemes

Physicians in the United States and some other countries are allowed to collect fees from pharmaceutical companies for talks, advice, and more. Supposedly, these are to compensate physicians for their expertise and time. However, they can create loyalty to a company and may influence prescribing habits – a belief shared by some pharmaceutical salespeople. In some countries like India, physicians are allowed to sell and profit off insulin directly through patients, or through pharmacies they themselves own, cutting out middlemen and the retail pharmacies. Thus, they lose the incentive to find the lowest price insulin for their patients. Insulin companies also focus on ‘insulin-starts’, or the insulin the physician diagnosing patients begins with. As patients are reluctant to change, a number of marketing and financial incentives are employed to influence this decision.

7. Payment for Influence 

Many major key opinion leaders, influencers, and patient advocacy organizations take pharma cash. For example, the two biggest diabetes organizations – The American Diabetes Association and The Juvenile Diabetes Research Foundation – have accepted huge sums from insulin manufacturers. Other groups were actually created by money from the ‘big three’, like the World Diabetes Foundation which is funded by Novo Nordisk, and other supposed advocacy groups that are actually doing pharma’s bidding, or at least are highly influenced by them. If this issue is important to you, check the funders of an organization you want to support, and if it’s not transparent, you can ask if they take industry money.

8. Manufacturing insulin is expensive

Producing insulin is more expensive than producing many other drugs. Insulin is a large complex molecule, and to create it manufacturers use recombinant DNA technology to engineer insulin-producing bacteria. In pharmaceutical terms, insulin’s size and complexity deem it a biologic. Because insulin is a biologic, any “generic” versions (termed biosimilars for biologic drugs) are subject to much more stringent–and expensive–approval processes by the FDA.

Because of the expense of producing insulin, even when biosimilar versions are produced, they only reduce costs for the drug by about 20%, compared to an average of 80% reduction for standard generics.

So what can be done?

How to reduce the expense of insulin

The expense of insulin has led some people to cut down their insulin intake, which can be extremely dangerous. Rather than risking your health, try these strategies to reduce costs.

1.  If you have insurance, make sure your brand of insulin is on the formulary.

For example, while CVS Caremark dropped Lantus, they still cover Basaglar, Levemir, and Tresiba.

2.  Ask your doctor about switching insulins. 

Human insulin is a fraction of the cost of analog insulin, and biosimilar Basaglar provides a modest cost savings.

If left with any doubt or query comment in comment in comment section below.