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In a previous AMS blog posting we reported on the FDA’s approval for an automated basal insulin delivery device. The Medtronic’s MiniMed 670G hybrid closed looped system eliminates the manual process of patients’ continuously checking their baseline glucose levels and administering insulin through needles or pumps. For the 1.25 million American children and adults with type 1 diabetes (T1D) whose bodies cannot produce insulin this “artificial pancreas” comes as quite a relief.

There’s no doubting that this new electronic wonder provides a new-found independence for those with T1D. From needles to auto-injectors to pumps this is yet another advancement in the process of medicating T1D patients. But what of the medicine itself?

First, a little history. It has been 95 years since three Canadian scientists discovered insulin. For a dollar apiece they sold the patent to the University of Toronto, knowing full-well its use would be immediate & widespread. Producing synthetic insulin was an extremely difficult process, though. So the university signed nonexclusive licenses with pharmaceutical company Eli Lilly (among others) to make and distribute the lifesaving discovery.

Usually, over time, generic drugs are introduced that create competition and lower prices. Insulin isn’t a drug, though; it is a biologic (made from living cells). As such it is extremely difficult to create insulin biosimilars (generics), not to mention much harder to get FDA approval. Right now there are no generics on the market at all in America. Even if there were generics out there, researchers doubt that prices would fall because of the way biosimilars are regulated by the FDA.

Currently, Novo Nordisk and Sanofi are the industry titans who dominate the T1D market. They make fast and long-acting types of insulin, both of which diabetics need. Having just two companies that provide the lions’ share of these medicines is not a good thing. Business thrives on healthy competition. And very often it seems that not only is there no competition, there is a veritable chumminess among the insulin makers.

For example, from the time Novo Nordisk’s Levemir came on the market in 2001 to compete with Sanofi’s long-acting insulin, Lantus, until 2015, the prices and corresponding increases between the two had been nearly identical. Similarly, Lilly’s insulin Humalog and Novo Nordisk’s Novolog to this day have been in lockstep since 2001. Many have raised their eyebrows concerning such timing and pricing parallels. Industry reps have brushed off such accusations as mere market forces at work. (Cynics would say their reputations precede them, pointing back to 1941 when Lilly and two other pharmaceutical companies were indicted for an alleged insulin price-fixing scheme, and in 2010 when Lilly and others were fined for collusion re insulin pricing.)

One would assume that, after nearly a century of research, these newer formulations would be a boon to diabetics. Dr. William Herman of the University of Michigan throws cold water on that assumption, stating though “the newer, more expensive insulin analogs appear to have incremental benefits [in comparison with] older, less expensive insulin preparations; their premium price requires us to ask whether they are really necessary, and if so, for whom?” Adds Dr. Hirsch, professor of medicine in the Division of Metabolism, Endocrinology, and Nutrition at the University of Washington: “Everything that we were supposed to see moving forward with better pharmaceuticals, better innovation, in actuality, they’ve outpriced it.”

A 2016 study by Dr. Herman and the University of Michigan Health System found that insulin costs have tripled in the last decade. In fact, since 2010, spending on all other diabetes drugs combined was lower than the per-person spending on insulin. Worse, due to the population getting increasingly heavier, insulin dosing has gone up. According to 2010 figures, per capita expenditures on T1D ranged from $4,426 to $8,150. The bulk of that amount goes to prescription drugs.

In the realm of catastrophic claims these costs are hardly a blip on the radar, so one might wonder why the subject of insulin concerns them. The United Kingdom Prospective Diabetes Study (2008) alludes to why the issue may explode into a huge problem:

  • Effective treatment cuts the risk of stroke by more than a third
  • Effective treatment more than halves the risk of heart failure
  • Effective treatment reduces the risk of kidney failure by more than a third
  • Effective treatment can reduce costly diabetes complications by approximately 50%

The reason to be alarmed is because many diabetics are skipping or omitting the treatments they need. They simply cannot afford their medications anymore. That leads to massive future costs. More strokes. More heart failures. More kidney failures. More complications that could easily be avoided with effective treatments that are affordable.

Meanwhile, bemused diabetics can only throw their hands up in resignation, with one Facebook user lamenting: “Insulin is 90 years old, and yet the cost continues to rise!”

In 1921, for the good of humanity, three scientists received $3.00.

In 2014, the global insulin industry made $24 billion.

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Brought to you by Jason Marcewicz, Special Projects Manager
Advanced Medical Strategies

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