Ring around the courtroom: the wait for U.S. biosimilar insulins

Treatment Insulin
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As we detailed earlier this summer, supply-side economics has an ugly hold on the insulin industry. Demand is high, and three companies (Lilly, Novo Nordisk, and Sanofi) hold 96% of the total insulin market by value, according to the American Diabetes Association.

At some point something has to give. So what about the biosimilar (read: generic) insulin market? Is there actual hope there for seeing decreased insulin costs or a wider array of available medicines? What needs to happen for that speculation to be realized? And why is everyone always suing everyone?

Biosimilars are approved copies of already marketed biological medicines. They essentially provide an alternative to existing biological medicines that have lost patent protection.

In general, biosimilar medicines are priced lower than the original product from which they are based. Drug price history suggests that at least two generics are needed on the market to lower costs in a meaningful way. If we look at biosimilar insulins, there does appear to be hope for decreased prices, but not as much as some may believe.

In the United States, “generic” versions of drugs typically carry a 50 to 80 percent price discount. Those are huge savings for people. Unlike most generics, though, biosimilar insulins (and other biosimilars in general) are much more expensive to manufacture.

Still, they do represent a discount.

Nearly 100 years into its medical life, insulin in the United States finally had its first generic in 2015. That December 2015, the Food and Drug Administration (FDA) approved the long-acting biosimilar insulin Basaglar (manufactured by Eli Lilly) for marketing. Similar to Sanofi’s biological, brand-name insulin Lantus, Basaglar’s approval was partly predicated on the safety and efficacy of Lantus. It came on the market in early 2017 (after a patent lawsuit between Sanofi and Eli Lilly was settled) about 15 percent cheaper than its precursor ($235 versus roughly $280 for Lantus).

Two other biosmilar insulins, Admelog (short-acting mealtime) and Lusduna (long-acting basal), have since been approved, but only Admelog has reached the market. For comparison, consider that biosimilar insulins have been available in India (Glaritus, Glarvia, Basalog, Wosulin, Insugen, Biosulin), China (Basalin, Comonlin, Prandilin), Mexico (Bonglixan), Europe (Abasaglar) and other parts of Asia for more than a decade.

Just like Nordisk and Lilly are loathe to let go of brand-name insulin shares, companies are battling to fight off the entry of generics as well. Litigation has severely slowed both the development and release of biosimilars in the United States and prevented diversification in the insulin market.

The above-mentioned Lusduna Nexvue, which was developed by Merck and received tentative FDA approval last summer, is the next biosimilar poised to hit the market. The hope is that it will carry a further 15 to 20 percent reduction in long-acting generic insulin costs, making an under-$200 insulin high end generic insulin available in the United States for the first time.

It’s release, however, is again tied up by Sanofi litigation. Like Basaglar, Lusduna Nexvue is also based on Sanofi’s Lantus. In January, Merck moved for summary judgment of non-patent infringement based on the grounds that the existing patent had expired along with the license to certain components of the injector pen that holds and delivers the insulin. In May, a Delaware court denied the request for summary judgment, leaving Merck’s time-line for market release in limbo.

So Sanofi sues Eli Lilly. Then Sanofi sues Merck. What gives?

In short, market share. With each successful generic insulin that hits the market based on its product, Sanofi faces potential profit losses. It all raises the question of when increased quality of life and decreased medical costs buck the proprietary nature of the drug industry and the hunger of profits.

Sadly, if current evidence is any indicator, it may be a while.

Even with the constant lawsuit game, there is a path for biosimilars reaching the market. It’s just a long one.

Merck has said that there are three ways to settle the outstanding patent litigation. First, the two parties in a suit can reach an agreement. That’s what happened in 2015 between Lilly and Sanofi, when Lilly reportedly paid undisclosed royalties to Sanofi in exchange for the license to the disputed patents. Second, a court can rule in the defendants favor, which, in the case of Merck, did not happen. Third, thirty months can elapse from the initial lawsuit filing date, after which the lawsuit effectively expires. Such a scenario would push the launch of Merck’s biosimilar to about 2020.

The wait goes on.

Written by: GREG BROWN

Greg Brown is a freelance health, finance, and environmental writer living in the mountains of western Maine. He has written for Consumer Reports Magazine, Consumer Reports Online, The New York Times, and The Chicago Tribune, among other publications. He holds an MFA in Fiction Writing from the University of Iowa Writers’ Workshop and an MS in Journalism from Columbia University.

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if other medical sectors are the guide, it is unlikely that biosimilars will reach the market soon. Let em give an example I am well aware of.

We have 3-4 biosimilar products in the RA community. These products however were originally marketed at about 20%. Ok well 20% discount is something. But, each of the regular biosimilars were sued and that litigation was resulted in settlements. The settlements raised the prices until 2023 and 2025 to about 95% of the original product. Ok well 5%is something right? Not so fast. The name brands then went to the PBM’s and gave them rebates greater than 5% to secure the business. so the PB’s now steer employees to the higher price medicines because they have the best rebate A rebate that does not totally get back to the consumers company.

My point, at last years ACR the scientists asked a group of doctors how many had patients using biosimilars? there were a few more than 100 doctors in the room. How many hands? None. Not one.

so when will biosimilars compete in the real world market for RA? Tune in for 2023 we can talk then.

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I travel to France, where on occasion I have had to buy Eli Lily’s Humalog (that is, exactly the same Eli Lily’s Humalog as in the US, with the same concentration). I have never had to worry as to whether my US insurance would cover it, because there it only costs 20 euros per bottle (that is, $25). Right now, the same bottle costs $315 in the US.

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/quote/ there it only costs 20 euros per bottle (that is, $25). Right now, the same bottle costs $315 in the US./close quote/

Wherein then, lies the difference? This is awful and at the same time, seems … unlawful. The Grand Ole USA has laws to protect us against such injustices … or so I thought. Thank you @MBCO for putting this in such a way that I could understand the stark (and drastic) difference in pricing.

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I’m not sure that’s true, unfortunately. The U.S. has an agency that is supposed to work towards consumer protection, but it is understaffed, underfunded, and currently led by an appointee ideologically opposed to protecting consumers.

There are some laws to protect companies from unfair competition (i.e., practices that might reduce a company’s profit), and that is the basis on which companies like Eli Lilly sue their competitors for patent infringement (or similar mechanisms). There are laws to protect consumer safety (in food, drug, and automobile sectors), consumers from unfair debt collection practices, from fraudulent advertising and claims, and (to some extent) consumers’ privacy. There are other laws that prohibit “competing” companies from conspiring with each other to raise prices (price fixing). There are no laws which say that a company can’t charge unfair prices for a product. In the U.S., a corporation can charge whatever they like, so long as they don’t engage in price fixing.

The European Union has two factors which contribute to much lower prices for life-saving medications. The EU has laws (both nationally and union-wide) which establish price-ceilings for medications. The EU is also dominated by countries with single-payer healthcare models, and in those countries the government or designated single-payer can negotiate pricing with pharmaceutical companies on behalf of a very large pool of patients (i.e., n=a country’s population). Many of those nations (like The Netherlands) also have supplemental private insurance policies in addition to their national healthcare mechanisms.

Ultimately, in my opinion (everything below the line above is opinion, as opposed to common factual information accessible online), this comes down to what we’re willing to tolerate as a society. Our people (as represented by our government) don’t currently think that pharmaceutical and medical-services pricing should work in any fundamentally different way than automobile pricing. Or toy pricing. Or gun pricing. The only pricing that is regulated in the U.S. by state or federal government tends to fall into two basic categories: “vices,” like alcohol, tobacco, etc., which have “sin taxes” appended to them to regulate demand by artificially increasing prices; and “subsidized products,” like commodity crops, refined gasoline, household and industrial electricity, and water (in some places), where the government either caps prices per unit or guarantees a minimum purchase rate per unit depending on the desired economic outcome. Many commodity crops (wheat, sugar beets, potatoes) are subsidized through crop insurance under the Farm bill, so that farmers’ know they’ll receive a certain number of dollars per unit produced, regardless of market forces (this is intended to keep production high and consumer-prices low). Utility-provided services or products (electricity, water, etc.) are sometimes capped in certain places, or are subsidized on the consumer (rather than producer) side in order to defray the cost to consumers at the lower-end of the earning spectrum.

A third kind of pricing control happens with Medicaid/Medicare, where medical services and pharmaceuticals are or could be negotiated (when not disallowed by the U.S. law) on behalf of large pools of people. Currently, these federal programs can negotiate reimbursement rates to service providers (doctors, hospitals, etc.), which is why some medical providers do not accept Medicare/Medicaid patients (especially specialists with high demand for services). Currently, the same federal programs are prohibited by law from negotiating with pharmaceutical companies, PBRs, or pharmacies on the cost of drugs.

What does that all mean? It means we as a society, are choosing to not regulate the price of drugs. We, collectively, have chosen to use a “price by market demand” mechanism, which means that companies will charge what they want to. The protections for profit (as @Rphil2 points out with RA biosimilars above) are such that “competitive pricing” (in the sense that more competition will lead to lower prices) is often avoidable, through either patent-protection or lawsuits leading to licensing settlements. The reality is quite simple: regardless of what it costs to produce, and regardless of what the company might do with their profits, the price of Lantus (or other current-generation insulins) is based on what the company believes it can recoup without hurting its market share. Period, end of story.

N.B. The laws in the U.S. regarding such things are super-complicated and complex, especially because there are multiple jurisdictions which tend to get into the fray (i.e., state, federal, and sometimes city/local). And we have multiple courts to fight over such things. And we have the Commerce Clause in the constitution, which is the single-most argued about part of our constitution (according to “More Perfect,” anyway), which determines what legislative bodies get to regulate economic activity. It is quite possible I’ve gotten something above wrong, and I’m happy to hear criticism from anyone who made it all the way through my disquisition!

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I made it all the way through and have -no- criticism. It’s an unfortunate truth. Somehow we have to find a way to change it, to appeal to some higher sense of humanity, to stop this insanity.

Thank you, very much for speaking so eloquently. I’m shaking my head at this injustice and only wish we, the Grand Ole USA, could find a way to do better, for all of mankind.

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Another sad example of big-pharma’s practices.

In addition to T1 I also have epilepsy. The anti-siezure drug has served me well for 18 years. Biosimilars hit the market in 2015, but within a year I was having breakthrough seizures (psychoative biosiliars are a special case - excipients and other non-active ingredients can play a role). Until this 2016 my insurance would let me get the brand name, but now they only cover biosimilars. The cost of the GSK brand name would be between $35K and $45K/year, Outrageous! GSK offers support for people without insurance, but because I was insured I didn’t qualify even though they didn’t cover the drug.

At my neurologist’s recommendation I looked at a Canadian firm. I was amazed to find the varying costs by region. Product secured from Canada runs $5K/year, from the UK $4K/year, and from Turkey $1200/year. So a spread from $40K to $1.2K for the same drug! I’m now buying from the UK via the Canadian pharmacy. (Rxcanada4less.com). You have to be VERY CARFUL buying outside the US because of potential counterfeits. But my doctor recommended this firm and I pressed their pharmacists over the phone with pointed questions and so far - no problems.

Pulling this back around to subject of Insulin - This pharmacy will deliver insulin to the US. Most others do not because of the need to refrigerate shipments, I checked into Fiasp a couple months back because I was afraid my pharmacy wouldn’t allow me to get it (ultimately they did!). Their price for Fiasp was roughly the same I’m paying via US insurance. If my insurance denied Fiasp this was my back-up plan.

It’s technically illegal for non-US pharmacies to sell into the US, but the FDA has turned a blind eye to the practice unless there’s egregious behavior. The justice department just shut down one of the largest Canadian pharmacies because they sold non-FDA approved drugs into the US.

It’s an option - BUT BE CARFUL!