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Analysis

FDA Moves to Curb Insulin Price Hikes as Pressure on Manufacturers Mounts

By Steven Porter  
   April 03, 2019

Insulin manufacturers have long been criticized for raising their list prices year after year. Now the FDA aims to make it easier to compete.

As insulin manufacturers and pharmacy benefit managers (PBM) face increasing pressure over rising list prices for the drugs millions of diabetics need to survive, the Food & Drug Administration has a plan to curb costs by spurring competition.

Insulin products have been approved as drugs under the Federal Food, Drug, and Cosmetic Act, but the FDA wants to transition insulin to an abbreviated approval pathway for licensure as biologics under the Public Health Service Act in 2020. This transition for insulin and certain other biologics follows congressional intent behind the Biologics Price Competition and Innovation Act (BPCI Act)—which was passed as part of the Affordable Care Act in 2010—outgoing FDA Commissioner Scott Gottlieb, MD, said Tuesday.

"The transition of insulin from the drug to the biologics pathway will open up these products to biosimilar competition," Gottlieb said in a statement. "We're already seeing robust activity among sponsors seeking to bring forward biosimilar copies of insulin."

"Once an interchangeable insulin product is approved and available on the market, it can then be substituted for the reference product at the pharmacy, potentially leading to increased access and lower costs for patients," Gottlieb added. "The FDA anticipates that biosimilar and interchangeable insulin products will bring the competition that's needed to help bring affordable treatment options to patients."

Insulin manufacturers have long been criticized for raising their list prices year after year. Eli Lilly & Co.'s popular fast-acting insulin product Humalog had a list price of about $21 per vial when it first came to market in 1996, but that price rose incrementally over the years, to nearly $100 in 2009, then $275 last year, as Kaiser Health News reported.

Lilly said last month that it will offer a half-price authorized generic version of Humalog for $137.35 per vial—a move that Mayo Clinic hematologist Vincent Rajkumar, MD, and others have described as a gesture made for the sake of public relations.

PBMs, too, have taken action to address the public outcry. Cigna's Express Scripts, one of the nation's largest PBMs, said Wednesday it will give clients the option to limit monthly out-of-pocket insulin costs at $25 per month, as The Wall Street Journal's Joseph Walker reported. The move comes as the Trump administration has blamed PBM middlemen for a chunk of the high cost of U.S. healthcare.

Amid all of this, the FDA said Tuesday that it will host a public hearing May 13 to discuss insulin's affordability and the plan to transition to a biosimilar evaluation and approval process.

"We understand the urgent need to address the high prices and lack of competition in the insulin market," Gottlieb said.

"A drug that's nearly a century old should not have a list price that increases between 15-17% annually," he added. "American patients who rely on insulin to live deserve to have high-quality, affordable options."

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.


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