Eli Lilly caps insulin costs at $35 per month
The drugmaker Eli Lilly is cutting the list prices for its most popular insulin products by 70 percent and capping out-of-pocket costs at $35 per month, the company said Wednesday, as pressure mounts on drug companies to address the high cost of diabetes care.
Out-of-pocket costs at participating retail pharmacies will max out at $35 a month for patients with commercial insurance using Lilly insulin, the company said in a release. That change will take effect immediately.
Beginning May 1, Lilly said the list price of its non-branded Lispro insulin will drop from $82.41 to $25 per vial, making it the lowest-priced mealtime insulin available, according to the company. The price of its Humalog and Humlin injections will drop by 70 percent, starting in the fourth quarter.
Yet because of the country’s drug pricing system, a company’s list price doesn’t necessarily reflect what insurers pay. Insurers and pharmacy benefit managers, middlemen that work with insurers, negotiate rebates which are paid after the fact. Insulin prices were allowed to rise so dramatically in part because drugmakers routinely raised prices to account for the rebates.
Lilly’s chief executive David Ricks said the change is meant to close the gaps in the health care system and make sure insulin is affordable for the 7 million people who rely on it.
An analysis released late last year found that approximately 1.3 million people, or 17 percent of all adults with diabetes in the U.S., rationed their use of insulin in the past year.
“While the current healthcare system provides access to insulin for most people with diabetes, it still does not provide affordable insulin for everyone and that needs to change,” Ricks said. “The aggressive price cuts we’re announcing today should make a real difference for Americans with diabetes.”
People without insurance can still benefit if they go to Lilly’s website and download its savings card.
The changes comes amid increasing pressure from advocates and lawmakers to bring down the cost of the vital drug. The $35-per-month cap matches up with a provision of the Inflation Reduction Act that sets the same cap for Medicare beneficiaries.
Democrats at the time of the bill’s passage tried to impose an out-of-pocket cap for all insurance, but Republicans successfully argued the provision was contrary to Senate rules and blocked it.
In President Biden’s State of the Union speech, he called on Congress to cap insulin prices at $35 a month for everyone, though Republican derided the effort.
Rep. Cathy Rodgers (R-Wash.), chair of the House Energy and Commerce Committee, said Biden’s call to cap prices for everyone was “socialist” and a “federal mandate.”
In a statement Wednesday, Biden praised Lilly’s move.
“Insulin costs less than $10 to make, but Americans are sometimes forced to pay over $300 for it. It’s flat wrong,” Biden said, adding Lilly’s actions are “a big deal, and it’s time for other manufacturers to follow.”
The price of insulin has risen dramatically in the past years, and the drug has long been targeted by lawmakers as an example of the broken incentives in the U.S. health system.
Insulin hasn’t changed much since it was first discovered more than 100 years ago, but as newer forms of the drug have been introduced, the price has climbed. Lilly, along with Novo Nordisk and Sanofi, account for 99 percent of the insulin on the market in the country
Lilly is a leading insulin manufacturer, but Ricks stressed that others need to join in on the company’s efforts to bring the cost of the drug down.
In a call with reporters, company executives expressed frustration that generic drugmakers don’t seem interested in making cheaper versions of insulin, even though Lilly’s patents have expired.
Updated 12:15 a.m.
Copyright 2023 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.