Drug company announces new version of insulin at half the price

Drug company announces new version of insulin at half the price
© Getty Images

The drug company Eli Lilly on Monday announced that it is introducing a cheaper version of its insulin that will sell at half the price, a decision aimed at tamping down the outcry over insulin prices.

The move comes in response to intense scrutiny of drug prices and particularly insulin, a decades-old drug that people with diabetes need that has seen huge price spikes in recent years.

ADVERTISEMENT

"While this change is a step in the right direction, all of us in the health care community must do more to fix the problem of high out-of-pocket costs for Americans living with chronic conditions," Eli Lilly CEO David Ricks said in a statement. "We hope our announcement is a catalyst for positive change across the U.S. health care system."

The move received some measured praise from lawmakers in both parties on Monday, but they also stressed that much more needs to be done.

Insulin has become something of a poster child for the wider problem of high drug prices, given that it is not a new invention and is needed for many people to survive, yet has had major price increases.

Eli Lilly’s move could help calm the firestorm of controversy, but lawmakers and advocates stressed that they still expect drug companies to do more to cut high costs.

"We're glad to see that at least one drug maker is taking steps to reduce the cost of this life-saving product, but we still have a long way to go to ensure this vital drug is truly affordable for the millions of Americans who need it every day to survive,” said Rep. Diana DeGetteDiana Louise DeGetteHere are the 95 Democrats who voted to support impeachment Crucial for Congress to fund life-saving diabetes research Overnight Health Care — Sponsored by Campaign for Tobacco-Free Kids — White House withdraws controversial rule to eliminate drug rebates | Grassley says deal on drug prices moving 'very soon' | Appeals court declines to halt Trump abortion referral ban MORE (D-Colo.), the chairwoman of an investigative subcommittee that sent letters to drug companies in January pressing them for answers on insulin prices.

Illustrating the pressure facing drugmakers over insulin, the Senate Finance Committee last month also sent letters asking the three main companies making insulin — Eli Lilly, Novo Nordisk and Sanofi — for information on their prices.

Senate Finance Committee Chairman Chuck GrassleyCharles (Chuck) Ernest GrassleyScandal in Puerto Rico threatens chance at statehood Poll: McConnell is most unpopular senator Democrat: Treasury 'acknowledged the unprecedented process' in Trump tax return rejection MORE (R-Iowa) called Monday’s move by Eli Lilly “good news” but stressed that more needs to be done and that he still wanted “thorough” answers to his questions on insulin prices.

Insulin is perhaps the highest-profile example of a growing storm over drug prices. Both President TrumpDonald John TrumpUS-Saudi Arabia policy needs a dose of 'realpolitik' Trump talks to Swedish leader about rapper A$AP Rocky, offers to vouch for his bail Matt Gaetz ahead of Mueller hearing: 'We are going to reelect the president' MORE and congressional Democrats have railed against high drug prices and called for action, making the issue a rare area where there is at least some chance of bipartisan cooperation.

That landscape has left drug companies on high alert and trying to prevent any major action that they view as damaging.

A lower-cost insulin option could help take a little steam out of the outrage. Advocates for lower drug costs, though, say they intend to keep up the pressures.

Ben Wakana, executive director of the advocacy group Patients for Affordable Drugs Now, dismissed Eli Lilly’s move as simply a “token PR play.”

Do not fall for this. Do not praise this move,” he wrote on Twitter.

“Other countries pay $20 for a vial of insulin,” he added. “Americans are getting ripped off at $140 per vial.”

The cost of the new lower-priced insulin will be $137.35 per vial. 

The drug has seen a sharp price increase in recent years. The price for Eli Lilly’s insulin increased from $35 to $234 between 2001 and 2015, a 585 percent increase, according to the letter from Grassley and Sen. Ron WydenRonald (Ron) Lee WydenDemocrat: Treasury 'acknowledged the unprecedented process' in Trump tax return rejection Hillicon Valley: Twitter says Trump 'go back' tweet didn't violate rules | Unions back protests targeting Amazon 'Prime Day' | Mnuchin voices 'serious concerns' about Facebook crypto project | Congress mobilizes on cyber threats to electric grid Top Democrat demands answers on election equipment vulnerabilities MORE (D-Ore.) last month.

The controversy over insulin has only grown with stories of people who have died after they could not afford insulin.

For example, Grassley and Wyden pointed to a story in the Des Moines Register that highlighted an Iowa man who died after he lost his job and started rationing insulin.

Eli Lilly’s new insulin will be exactly the same product as the current version, just at a lower price. While the list price of the current version is much higher, insurers do not actually pay that full price because they receive discounts known as rebates. However, there has been a raging debate over rebates, with drug companies accusing insurers of not passing the discounts on to patients.

Eli Lilly said introducing a cheaper version of insulin that does not deal in rebates will help get the discount directly to patients who are paying out of pocket.

The company will also continue selling the full-priced version coupled with rebates for patients where insurance is picking up the tab.

DeGette said her investigation would continue, and she called on other drug companies to also lower their prices.

“I strongly urge others to act similarly, because what we have learned through this announcement is that lowering the cost of this important drug is much more doable than previously thought,” she said.

Updated at 4:27 p.m.