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Blame Game Continues at House E&C Hearing on Insulin Prices

Posted 10 April 2019 | By Zachary Brennan 

Blame Game Continues at House E&C Hearing on Insulin Prices

As American diabetics continue to die because they cannot access affordable insulin, representatives from pharmacy benefit managers (PBMs) and insulin manufacturers on Wednesday pointed their fingers at each other at a House Energy & Commerce Committee hearing.

The particularly dire situation for many comes as executives from Eli Lilly, Sanofi and Novo Nordisk have tried to offer a fig leaf to patients in recent weeks. Sanofi, for instance, said it will offer $99 per 10 mL vial or $149 for a pack of its SoloStar pens – roughly a one-month supply – at a discount of up to 60% below the list price. And Eli Lilly recently announced it would introduce an authorized generic version of its Humalog insulin at half the original price.

All three insulin manufacturers noted not only how their insulin list prices have increased, but that net prices have come down recently. All three also said that lowering list prices might mean that patients would lose access to their insulins because of the way the current rebate and insurance system works.

Kathleen Tregoning, EVP of Sanofi, said: “The issue isn’t the negotiating [with a PBM], it’s that the rebates aren’t going back to the patients. And rebates secure formulary placement.”

Doug Langa of Novo Nordisk added: “Simply lowering the list price won’t necessarily increase access. There’s a perverse incentive to keep list prices high and keep rebates high.” Langa also said in his written testimony that the relationship these prices bear on the ultimate price patients pay at the pharmacy counter “should be examined.”

And despite more than a few clear signs that the current system around insulin prices is dysfunctional, Eli Lilly SVP Michael Mason said at one point that competition “is fierce” and the “market is working.”

But few clear solutions were offered by representatives, even as some sought drastic changes.

Rep. Joe Kennedy (D-MA) expressed his dismay at several answers that skirted around the issue of affordability. E&C Chairman Frank Pallone (D-NJ) also said that perhaps the government should “get rid of the PBMs and have the government set the price” for insulin. The executives said they would prefer market-based solutions.

Expressing a need for transparency, Rep. John Sarbanes (D-MD) added: “I think PBMs should be utilities or converted to non-profits. When you started out, I understand what the mission was, it’s a complicated industry, you need an intermediary…but now things have gotten out of control.”

Jan Schakowsky (D-IL) added: “I don’t know how you people sleep at night.”

On the PBM side, the executives said they supported increasing insulin competition, but also pointed their fingers back at the high list prices set by the manufacturers.

Sumit Dutta, chief medical officer of OptumRx, said in his written testimony: “Manufacturers assert that their net profits on insulins are going down even as list prices go up. For a drug that is 100 years old and has seen no significant innovation in decades, their profits should go down.”

Thomas Moriarty, EVP and general counsel for CVS Health, said in written testimony: “The primary challenge we face is that unlike most other therapeutic classes, until recently, there have been no generic alternatives available.”

The push for more competition comes as four senators on both sides of the aisle sought tweaks to recent US Food and Drug Administration (FDA) guidance on speeding new biosimilar insulin products to market.

The guidance is part of FDA’s work to begin, starting in March 2020, transitioning approved marketing applications for a subset of products, including insulin—previously approved as drugs under section 505 of the FD&C Act—to be biologics. But questions remain on whether this transition period will briefly halt companies from seeking to bring insulin competition to market.

FDA will hold a public meeting on insulin competition on 13 May.

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