Beyond Type 1’s coverage:
On Monday, March 4, Lilly Diabetes announced in a press release that an authorized generic version of Humalog insulin will be available in United States pharmacies for half the list price of Humalog.
Called Insulin Lispro, the generic version will be identical to rapid-acting Humalog, mirroring both its structure and function. The list price of one vial will be $137.35 and the price of a box of five pens will be $265.20. According to Lilly’s announcement, these products have already been manufactured and they plan to make them available in pharmacies around the United States quickly. Insulin Lispro will be sold under ImClone Systems, a Lilly subsidiary.
Insulin Lispro will be available to patients who take Humalog without an additional prescription from a doctor. Patients will be able to speak directly with a pharmacist to determine whether Humalog or Insulin Lispro is a more cost effective option for them.
So why not just cut the price of Humalog in half? High (and rising) list prices for Humalog are partially due to rebates paid by the insulin manufacturer to insurance companies and pharmacy benefit managers. These rebates guarantee Humalog is covered by insurance plans and available on formularies. Cutting the list price of Humalog would jeopardize insurance coverage for those currently taking the drug, but introducing a generic insulin at half the cost means that insurers, pharmacy benefit managers, and other members of the supply chain will continue to receive large rebates through existing contracts. The addition of Insulin Lispro to a formulary does not fundamentally change the system, but offers an additional lower cost option for people paying for insulin out of pocket immediately and within the confines of the current U.S. insulin pricing machine.
Lilly Diabetes confirmed today that their team is working with insurers, pharmacy benefit managers, and drug wholesalers to get Insulin Lispro added to formularies and covered by insurance alongside Humalog.
People without insurance who are paying 100% out of pocket for their supplies are likely to benefit the most from the half-price option. People with diabetes on high-deductible health insurance plans will also now have an option that reduces monthly out-of-pocket expenses before they’ve met their deductible. Those with comprehensive drug coverage as part of insurance may not experience a change.
Enrique A. Conterno, the president of Lilly’s diabetes division, told the New York Times Friday that the list price for the new Insulin Lispro is set comparable to the net price paid by insurers in exchange for placement on their formulary. This represents a new move to attempt to better pass the savings offered to insurers and pharmacy benefit managers through to patients. In January, a new rule was proposed by Health and Human Services designed to encourage manufacturers to pass discounts directly to patients at the pharmacy by setting up a fixed-fee system between manufacturers and pharmacy benefit managers. The rule applies only to Medicare and its merits are being debated – but the proposal represents a future vision for drug pricing reform. According to Lilly CEO David Ricks, “for people with diabetes, a lower-priced insulin can serve as a bridge that addresses gaps in the system until a more sustainable model is achieved.”
The launch of a new insulin with a 50% lower list price comes in response to mounting pressure from insulin access advocates and recent political inquiries on the issue. Advocates have long argued that current discounts offered through insulin manufacturers do not adequately address the needs of people with diabetes struggling to afford life-sustaining medication. This announcement is likely to be seen as not going far enough in reducing the the list price of insulin.
David Ricks said in an interview with the New York Times, “there are clearly patients who, despite many best efforts, are struggling to afford their insulin…This is a step we can take to close part of that remaining gap.”
Today’s announcement follows the mid-2018 launch of the Lilly Diabetes Solution Center, a hotline offering personalized help for individuals to understand their assistance options. While Novo Nordisk and Sanofi both offer patient assistance programs as well, the two other major insulin manufacturers have not introduced new solutions to recent pricing pressures.
Lilly isn’t the first drug company to launch a generic version of its brand-name product to address pricing pressure. In 2016, advocacy around the price of EpiPen spurred Mylan to begin selling an authorized generic. And while several generic and biosimilar insulins do exist, insulin currently lacks a generic market that offers substantially lower list prices. When Sanofi’s Admelog reached market in 2018, it cost $233 per vial and $450 per box (list price), offering only a 15% price discount from Humalog. Basaglar’s launch saw similar price savings. The 50% discounted list price for Insulin Lispro represents the first substantial reduction in list price.
“While further action, across the healthcare system, must be taken to ensure unqualified access to affordable insulin, today’s announcement of a 50% lower list price generic is an important step in the right direction,” said Beyond Type 1 CEO Thom Scher. “Lilly is presenting a meaningful change for the growing number of people paying out-of-pocket for insulin at the pharmacy, building on their other efforts in recent months. We are hopeful that other manufacturers and entities within the supply chain will take material actions as well.”
Read Beyond Type 1’s recent news coverage of the letter sent to insulin manufacturers by US Senators. If you or someone you know is struggling to afford insulin, know your options.