Will insulin be on hand?
In an attempt to address the root causes of insulin cost inflation, ca lawsuit Last week he accused drugmakers and pharmacy benefit managers of artificially and illegally raising the price of insulin.
the Making a sausage to learn how to price insulin Not for the faint of heart. It’s a complex group of drug manufacturers that have been drug resistanceHealth insurance companies are trying Keep up the impressive profitsIn addition to wholesalers who distribute medicines to pharmacies and pharmacies that provide them to patients. Slipping into that milieu are pharmacy benefit managers, the companies that negotiate drug prices on behalf of insurers and manage the prescription drug side of individuals’ health insurance.
The cost of insulin starts with a list price set by the companies that make it. Three manufacturers dominate the global insulin market: US-based Eli Lilly, Denmark-based Novo Nordisk, and France-based Sanofi. Insulin falls under the category of biopharmaceuticals. Medicines produced from living organisms such as yeast and bacteria, or derived from living cells and tissues. These drugs are more complex and expensive to produce than so-called small-molecule drugs like aspirin and furosemide that are made via standard chemistry protocols.
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Drug companies routinely justify their high prices as a result of a complex manufacturing process. these Claims have been debunkedincluding through a recent study that directly compared what drug companies spend on drug development with how they price and find their products Not related at all.
The truth is, drug manufacturers can set prices as high as they want in the United States because there is absolutely no such thing prevents them from doing so. These companies sell similar products to other provinces for shockingly lower costs. in Graph It will spike your sugar even if you don’t have diabetes, Rand researchers have shown that Americans with diabetes pay up to 10 times more than their international counterparts for the same insulin products.
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Under the standard rules of capitalism, the three major insulin manufacturers are expected to compete and drive prices down. But companies actuallyShadow price their productsraising prices in unison.
Pharmacy benefit managers play a unique and somewhat hidden role in the cost of insulin. PBMs initially started out with a specific mission: handling the nitty-gritty of processing and adjudicating prescription claims that insurance companies and large employers were so eager to work with. Their powers have expanded and they now create prescriptions that dictate which medications an individual’s insurance will cover.
Although their job is to negotiate drug prices for these prescriptions on behalf of the insurance companies—and thus for the patients—a large portion of the savings they extract from the drug companies ends up in their pockets and is not passed on to the insurers or their clients. . Even when lower-priced, bioavailable insulin became available in 2021, most PBMs opted for it The higher-priced brand versions for their formulas. Because their fee is usually a percentage of price listThey have every incentive to choose the higher priced drugs. They can negotiate “discounts” and “rebates” from these higher prices, but they will still charge a larger fee set by the original higher price.
Aggressive mergers and consolidations have reduced the PBM field to three major players – CVS Caremark, OptumRx and Express Scripts – who together control more than three quarters Of all the prescription drugs in the United States, so there is little competition. (And in a stunning example of vertical integration, PBMs are now owned by health insurance companies: CVS Caremark from CVS Health, which also owns Aetna health insurance as well as the CVS pharmacy chain, OptumRx from United Healthcare, and Express Scripts from Cigna.)
the Inflation Reduction Actthat come into effect This month, made the news as the first federal legislation to address insulin costs. But when the dust settled, it turned out to be less than a Band-Aid, helping only a small portion of the people who need insulin by treating only a small part of the problem.
Let’s start with a small part of patients. In the original bill, the cap applied to everyone who used insulin. obligatory to Republican opposition in the SenateHowever, the final bill stripped most recipients of this provision, so it now only applies to 18% of Americans with Medicare. The other 82% — people under 65, anyone with regular insurance, and those who lack insurance — remain at the mercy of market forces for insulin.
The second issue is that the act only addresses a small part of the problem. Cover applies to sharing On insulin – the part that the patient contributes – not the actual price list for insulin. The $35 cap on co-pay certainly offers tangible relief to some people, but it documents the chaos that has led to lower insulin prices. To be fair, Senate Republicans made this point in their objection to the participation caps, though they offered no workarounds. The fact that drug companies are putting pressure on them Support these hats to share As a solution to the crisis should be an immediate red flag.
I am a doctor, not an economist. But the diagnosis is as clear as day: greed. America has decided that health care—unlike our water supply, education, the roads we walk on, and so much more—is not a basic right of its people. Once we allow healthcare to be as commercial a product as cell phones, sports cars, and jewelry are, all the players with fingers in the pie will extract as much money from the operation as the market will bear. Insulin is the main poster child for this uniquely American greed, though it is certainly not the only example.
a A disturbing new study It recently revealed that 20% of Americans with diabetes ration their insulin use—lowering or skipping doses, or cutting them out—for financial reasons. Insulin disorder is so common that it now exists Algorithms for doctors To use when their patients can’t afford their prescribed insulin.
California’s attorney general in the state’s lawsuit named all three major insulin manufacturers and all three largest PBMs, accusing these six companies of raising prices beyond inflation and the cost of development. In particular, the lawsuit targets sudden list price increases by manufacturers, opaque price negotiations by PBMs, and the “oligopolistic” nature of the entire organization that ultimately benefits corporate entities rather than the people who use insulin.
The headlines from the Inflation Cap Insulin Sharing Act gave many people the impression that Congress had done its job to control insulin costs. But this is not the case. the $350 million lobbying effort The pharmaceutical and healthcare industry may offer some hints as to why Congress’s efforts are so half-hearted.
Despite a deeply divided government, controlling drug prices is a bipartisan issue for both voters and politicians. Many other countries have managed to maintain healthy capitalist economies while they still are Enacting laws To regulate health care costs. Admittedly, having universal healthcare systems helps, but there is still a lot Congress can do. It could pass regulations that prevent drug companies from charging Americans 10 times more for insulin than they charge people in other countries. He can investigate the black box of PBM negotiations and the regulation of anti-competitive practices pervasive in the pharmaceutical industry. It could allow Medicare to use its purchasing power to negotiate drug prices All Medicines, not just a handful in the inflation act. It could regulate abuse of the patent system that closes monopolies and discourages generics. Congress just needs the courage to put the sick before the lobbyists.
For now, a legal system may be the only way to tackle the current wave of insulin price gouging. California’s lawsuit follows similar actions from IllinoisAnd ArkansasAnd MississippiAnd Kansas. Lumbering from case to case will not bring the immediate relief diabetics need, but the courts may offer the only hope for achieving what Congress lacks the courage to do.
Danielle Overy, MD, is a primary care physician at Bellevue Hospital in New York, clinical professor of medicine at New York University School of Medicine, and editor-in-chief of the Bellevue Literary Review. Her most recent book is When We Hurt: A Doctor Faces Medical Error (Beacon Press, April 2020).
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