Third major insulin maker will slash the price of insulin

Sanofi was a holdout as two rivals lowered price

Amid consumer angst and political pressure over the cost of life- saving insulin, Sanofi announced Thursday it would slash the price of its most- prescribed insulin, Lantus.

Sanofi was the final holdout among three companies that make up 90% of the world’s insulin market by value. Earlier in the week, Novo Nordisk followed Eli Lilly Co.’ s plans to slash U. S. prices by up to 75% and 70%, respectively.

Sanofi said it will cut the price of Lantus by 78% and short- acting Apidra by 70% as of Jan. 1, 2024.

The prices these companies set for insulin have increasingly been scrutinized by analysts, politicians and patient advocates. In recent years, federal and state laws, Medicare and Medicaid policies, and changing market dynamics for these older insulin drugs have influenced price cuts.

But more needs to be done, said Elizabeth Pfiester, founder and executive director of T1International, an advocacy organization for people with Type 1 diabetes.

The life- saving medication is needed by millions of people. A 2020 survey from her organization found 1 in 4 people with Type 1 diabetes rationed insulin because of cost. Patients also struggled to pay the out- of- pocket costs for other supplies such as insulin pumps, testing strips and continuous glucose monitors.

Her group is pushing for a federal policy that would cap the cost of insulin.

“It’s great that they’ve chosen to lower the price,” Pfiester said of the insulin manufacturers. “But they can choose to raise the price again.”

Sanofi drops list price for Lantus

Sanofi’ s list price is $ 292 per vial of Lantus, the amount charged before discount programs or reduced prices negotiated by health insurers. When Sanofi cuts the price as of Jan. 1, Lantus will cost about $ 64 per vial.

The company also announced a price cap that ensures no patient will pay more than $ 35 for a month of Lantus.

The Paris- based pharmaceutical company earlier said most people with private insurance already pay $ 15 or less because of a copay assistance program. The program for the uninsured also offers a 30- day supply for $ 35.

“The list prices of our insulins do not reflect the actual, net prices paid to Sanofi after various discounts and rebates,” Sanofi said. “Despite the rhetoric about skyrocketing insulin prices, the net price of insulin has fallen for eight consecutive years, making our insulins significantly less expensive for insurance plans.”

Sanofi vowed to continue to listen to patients, advocates, caregivers and others to “better understand additional actions we could take to address access or affordability challenges.”

Why is insulin so expensive?

Insulin prices charged by the three major drug manufacturers spiked over the past two decades. From 2002 through 2013, the average price of insulin nearly tripled, according to the American Diabetes Association.

A Senate Finance Committee investigation in 2021 found the drug price increases coincided with lucrative rebate demands from insurers and pharmacy benefit managers, which are drug- pricing middlemen that command steep rebates in exchange for favorable placement on private insurance plan drug formularies.

These pharmacy managers in the past decade began to pit manufacturers against one another by excluding them from large blocks of patients through formulary exclusions, the Senate Finance Committee reported.

Insulin prices starting to drop

Last year’s sweeping climate and health bill called the Inflation Reduction Act caps insulin costs at $ 35 a month for Medicare enrollees. And Biden urged Congress to extend the outof- pocket cap to younger Americans who have private insurance.

Washington, D. C., and 22 states have enacted cost- sharing limits for consumers purchasing insulin, according to the American Diabetes Association.

Drugmakers also are bracing for a drug pricing change under Medicaid, the federal health program for low- income families. Medicaid has required drug companies to pay rebates when they raise prices over time. But the amount drug companies paid Medicaid was capped in previous years.

The new provision, part of the American Rescue Plan Act passed in 2021, eliminates the rebate cap beginning next year. In other words, drug companies could face significant financial penalties beginning next year, said Antonio Ciaccia, CEO of 46brooklyn Research, a nonprofit that researches drug pricing.

The elimination of this Medicaid rebate cap, in particular, might be influencing drugmakers decisions to drastically cut insulin list prices, he said.

“It’s one thing for a drug manufacturer to offer something for free,” Ciaccia said. “It’s another thing to literally pay for the privilege of doing so.”

Insulin will keep getting cheaper

Drug manufacturers also face changing market dynamics.

Cost Plus Drugs, a company from tech entrepreneur Mark Cuban, aims to deliver lower- priced drugs to consumers. The company has launched a test program for insulin.

Meanwhile, CivicaRX plans to make and sell market discounted biologics that are interchangeable with Lantus, Humalog and Novolog.

Ciaccia, of 46brooklyn, said these older insulin drugs also face competition from newer insulin products.

“The writing is on the wall from a market perspective,” Ciaccia said.

How much does insulin cost?

Before price cuts, insulin has cost nearly $ 300 a vial.

Eli Lilly, the first to announce insulin price cuts this month, will slash the drugmaker’s most commonly prescribed insulin Humalog to $ 66.40 per vial, down from $ 274.70. It will implement price cuts within the final three months this year.

Novo Nordisk will cut the price of its top- selling NovoLog to $ 72.34 per vial, down from $ 289.36. Novo’s discounts will take effect Jan. 1.

AFP VIA GETTY IMAGES Paris- based Sanofi was the final holdout among three companies that make up 90% of the world’s insulin market. The firm said it will cut the price of Lantus by 78% and short- acting Apidra by 70% as of Jan. 1, 2024.