Lilly has dropped the prices of its most commonly prescribed insulins by 70 percent in the US and is expanding a program to immediately cap patient out-of-pocket costs at $35 per month. Its unbranded insulin lispro injection will cost $25 per vial – which will be less than the price of a Humalog vial in 1999. The price of Humalog will be reduced by 70 percent in Q4 of 2023. Lilly is also launching a Lantus biosimilar, which will be priced 78 percent lower than Lantus.
In a statement, Lilly Chair and CEO David A Ricks issued what sounds like a challenge to other insulin manufacturers: “We are driving for change in repricing older insulins, but we know that 7 out of 10 Americans don’t use Lilly insulin. We are calling on policymakers, employers and others to join us in making insulin more affordable.”
And certainly the pressure is now on for Novo Nordisk and Sanofi to similarly reduce their insulin prices. Bernie Sanders has written letters to both companies to ask if they would be lowering the cost of insulin. The letters state: “Insulin is not a new drug. It was discovered 100 years ago by Canadian scientists who sold the patent rights of insulin for just $1 because they wanted to save lives, not make pharmaceutical executives extremely wealthy. And yet, as a result of unacceptable corporate greed, the price of insulin has gone up by over 1,000 percent since 1996 causing 1.3 million people with diabetes to ration insulin last year, while your companies made billions of dollars in profits.”
In 2022, it was reported that some uninsured patients in the US were paying over $1000 per month for insulin. The cost of medicines – particularly insulin – in the US has been under fire for some time. The Inflation Reduction Act was passed last year to give Medicare power to negotiate on the price of certain drugs and a monthly price cap of $35 for insulin for Medicare patients was also introduced. Efforts to introduce the insulin price cap in the private healthcare market were blocked by Republicans, but Eli Lilly appears to have read the room. It’s worth noting that in November 2022, the company was also at the center of a media storm and public shaming campaign – triggered by the great Twitter blue tick debacle when a parody “verified” Lilly Twitter account posted that insulin would be available for free. Lilly seems not to have posted on Twitter since.
In fact, some Twitter users believe that the latest announcement stems from the backlash Lilly experienced last year. What else are Twitter users saying about Lilly’s latest announcement? There’s a lot of celebration, but some have pointed out that Lilly had to do something with incoming competition from organizations like Civica Rx, which has been shaking up the generic drug market with its nonprofit model. The company announced plans in early 2022 to manufacture and launch insulin at no more than $30 per vial.
Here’s a snapshot of what users of the social media platform are saying:
On Reddit, there has also been celebration. However, there is also scepticism about how the price decrease will affect future legislation and whether Lilly may roll back prices in the future. Quotes from a discussion thread on Reddit include:
“Not a bad development but easy to see how it can be a tool to ward off additional legislation and be easily reversed by some executive who needs a quick fix to protect growth targets in a year or so.”
“Rather than stating the company name like they are the good guys; ‘Company does the right thing only after being forced’ is a better description. They could have capped the cost decades ago.”
“I think it’s so they can try to dissuade Congress from passing any legislation under the guise of ‘See, The Industry Is Regulating Itself!’ Keep in mind, Eli Lilly can reverse course on this price change at a moment’s notice as long as Congress doesn’t put limits on them. There is nothing binding about this move.”
“One of the competitors is now the State of California. Another is Mark Cuban's Cost Plus, which promises to its customers that their prices are the cost to manufacture plus 15% gross profit.
That’s the real reason why they cut the price in the first place, they now have competition that they didn’t have before.”
What’s your view on the move? It would be fantastic to hear the views of seasoned industry experts on the matter. Drop me a line at stephanie.sutton@texerepublishing.com.
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