In February of 2022, the United States Congress worked on a bill to be added to the Inflation Reduction Act that would cap the out-of-pocket costs of insulin at $35 a month for those on Medicare. After deliberation, the legislation has gone into effect as of January 2023 with the Biden Administration labelling the cap a success for the American people when Eli Lilly, a major insulin producer, pledged to meet the cap for the 4 million diabetics on Medicare. Despite this win for many people, we must ask if this is enough.
Insulin is a life-saving drug for those living with diabetes. Type 1 diabetes is a genetic or virus-induced life-long condition that occurs when the pancreas produces little-to-no insulin and is often diagnosed in childhood or adolescence. Type 2 diabetes develops over time because of the body’s inability to regulate sugar. Although diet and exercise can help control the risk of the disease, particularly for those with Type 2 diabetes, there is currently no cure. Insulin allows those with diabetes to control their blood sugar level; without it, diabetics can experience organ damage or go into a diabetic coma, which can be fatal.
The average price of a vial of insulin in the US is $98.70, which is 5 times that of other countries. Because of this high pricing of insulin, over 1 million diabetics have had to turn to insulin rationing which has killed many people as it causes their insulin levels to get too low. The stress of budgeting for these medical costs has greatly impacted families and put stress on diabetics to search for a steady stream of income throughout their lives to provide them with funds for medication and more comprehensive health insurance.
In considering the impact of this bill, we must reflect on its applicability. The bill only affects those on Medicare, which benefits those 65 years of age and older or those considered to have a disability. Over 21 million people with diabetes are under the age of 65, and many people who are over 65 are not on Medicare — none of these people are receiving the cost cuts of the bill. Moreover, many people with Type 1 diabetes do not receive discounts through health insurance plans or programs offered through pharmacy benefit managers (PBMs), which are helpful in reducing the cost of insulin. This is why groups such as the American Diabetes Association, the Juvenile Diabetes Research Foundation (JDRF), and Mayo Clinic have all pushed for this cost reduction to be broadened to those on private or commercial insurance as well as many more reform options.
Can this be done? Currently, there are three pharmaceutical companies - Novo Nordisk, Sanofi-Aventis, and Eli Lilly — which exercise a monopoly over insulin production. In terms of distribution, there are three PBMs – Optum, Express Scripts, and CVS – controlling 75% of the market, and three wholesalers manage 90% of their market. The fact that insulin is lifesaving necessity that must be repurchased regularly means these companies have a constant consumer market, and there are strict patents surrounding insulin and biosimilars so there is little room for scientific innovation to expand treatment options. These patents combined with the monopoly over production and distribution means that these companies have complete control over their pricing cost.
Pricing could quite easily and significantly be reduced, especially considering that when the affected individual works to control pricing through under-dosing it is fatal. Mayo Clinic suggests the implementation of a government agency to set copays, approve patents, and expand to a reciprocal approval process, which would allow collaboration with countries such as Canada who have a more diverse range of safe insulin products. This diversification is important as the JDRF points out that insulin affects diabetics differently, so being able to select an insulin, insulin pump, or continuous glucose monitoring (CGM) type that works best for the individual allows them to manage their condition better.
This high pricing for life-saving drugs is not new. The same conversation has been happening with the EpiPen as costumers are forced to pay $622.09 for just two EpiPens in the US. The purchase is necessary to prevent anaphylaxis and must be updated regularly to ensure the medication does not expire, and this recognition that pricing could be inflated for the constant market has created the same situation for these drugs.
The process of exploiting the medical needs of a vulnerable group for profit and wealth accumulation is incredibly inhumane. Although the Inflation Reduction Act was a step in the right direction for insulin capping, only a small set of those affected by diabetes will be truly assisted by this new process. Diabetics of all ages and differing insurance programs should not have to suffer because of soaring pharmaceutical costs that put immense pressure on the consumer to have a high-paying and steady source of income. The stress put on families and individuals is unfair as they are forced to weigh their safety against their ability to pay.
Governments around the world already have far more affordable and readily available insulin options. Reform actions are possible, and it is the duty of the US government to ensure monopolies are not taking away the ability for millions of Americans to survive. Healthcare reform is necessary now; with the primary step of the Inflation Reduction Act and ongoing pressure to make these changes, it will be interesting to see what actions the US government takes in the future.
Image via Unsplash.