Newsom: California will take lead in slashing drug prices
Governor announces 90% cut in insulin costs; combating fentanyl and opioid crises also on the agenda
“We have the opportunity now to explore other manufacturing opportunities and as a consequence, disrupt more markets, lower costs, more costs for real folks.”
— Gov. Gavin Newsom
The state of California and a nonprofit will join forces to significantly lower the price of insulin for diabetes patients, Gov. Gavin Newsom announced at a news conference in Downey on Saturday.
Newsom said that the state has secured a 10-year partnership with nonprofit Civica that will bring down the cost of insulin about 90%, or to no more than $30 a vial. That could save diabetes patients between $2,000 and $4,000 a year, according to Newsom.
No new prescription will be needed and the insulin will be available with any insurance plan, he said.
Newsom said the $30 will be the “full total cost” of the insulin, which includes production, manufacturing and distribution.
“They're not looking to make a buck; this is at our cost collectively,” Newsom said of Civica. “That will drive down the cost for everybody else.”
Newsom said that a 10 milliliter vial of insulin will be no more than $30 as opposed to $300. A box of five pre-filled 3 milliliter pens will cost no more than $55; the normal cost is $500.
Jennifer Spalding, Civica's chief commercial officer, general counsel and compliance officer, said Saturday that Civica was formed in 2018 as a nonprofit pharmaceutical to “solve a problem of critical drug shortages in the U.S.”
“We have one overarching principle of Civica, and that is to do what's in the best interest of patients,” Spalding said. “And be
cause of that mission, we have expanded our efforts outside of the hospital to focus on bringing down the cost of health care for consumers at the pharmacy counter.”
Newsom said the state is not stopping with insulin.
“We have the opportunity now to explore other manufacturing opportunities and as a consequence, disrupt more markets, lower costs, more costs for real folks,” Newsom said.
Newsom also announced a plan to combat the fentanyl and opioid crises by empowering the state to manufacture Naloxone.
Naloxone is regarded as a lifesaver by first responders, medical teams and others. According to the National Institute of Health, Naloxone is a medication that “rapidly reverses an opioid overdose,” but it is “not a treatment for opioid use disorder.” It is available as injectable or prepackaged nasal spray forms that have been widely distributed to emergency teams.
The state has invested more than $1 billion in fighting the opioid crises, according to Newsom, to get the drugs off the streets, including efforts to get overdose medication to middle and high schools in California.
In 2023, the state is setting aside $79 million to the Naloxone distribution project, which includes both injectable and spray forms.
“We had 120,000 known reversals last year, in 2022, as it relates to Naloxone distribution project,” Newsom said. “The project is literally saving lives.”
The state also is tackling the opioid issue through combating drug-trafficking organizations through the California National Guard, making Naloxone and fentanyl test strips more available and youth opioid education through the state’s opioid task force.
In 2020, Newsom announced the creation of Cal Rx, which would create manufacturing partnerships to produce or distribute generic prescriptions drugs. The state will develop, produce and distribute drugs such as insulin to help lower costs. This is turn would make “essential medications affordable and accessible to more patients,” according to Newsom’s office.
Later that year, Newsom signed Senate Bill 852, authored by then-Sen. Richard Pan, that would allow the California Health and Human Services Agency to develop manufacturing partnerships to produce or distribute generic prescription drugs.
At Saturday’s event, Pan, who also is a pediatrician, said he and his physician colleagues “know how frustrating it’s been to get medications to patients.”
“But more importantly, patients themselves are even more frustrated and not feel they have access to their medications,” Pan said. “They need to keep themselves healthy and actually, frankly, save their lives.”
Civica is currently working with the CHHSA to find a California-based manufacturing facility.
In a statement, Los Angeles County Supervisor Janice Hahn praised the “governor’s ambitious effort and his commitment to taking on the challenges Californians are facing.”
“No one should have to choose between paying for the prescription medicine that keeps them alive and paying their rent or putting food on the table,” Hahn said.