September 11, 2019

Novo Nordisk on Friday announced that it will offer generic versions of its insulin drug Novolog at 50% of the drug's current list price in the United States, making it the last of the so-called "Big Three" insulin drugmakers to offer lower-cost insulin products to U.S. consumers.

New report: 4 steps needed to realize pharmacy’s full value

Background: Drugmakers launch lower-cost insulin products in responses to rising scrutiny

According to a report from the Healthcare Cost Institute, per-person spending on insulin for patients with Type 1 diabetes doubled between 2012 and 2016. Even for patients with health insurance, out-of-pocket insulin costs can reach $1,000 per month.

The sudden cost increase has sparked concerns among patients and Congress about patients' access to the life-saving drug. In response, federal lawmakers have launched investigations into rising insulin prices and have called for measures to expedite FDA approval of new insulin products.

In particular, the three largest insulin makers—Sanofi, Eli Lilly, and Novo—have long faced criticism over rising insulin costs. A congressional committee in April called on executives from the companies to testify about rising insulin costs at hearings focused on prescription drug prices.

In response to the mounting criticism, Sanofi in April set a fixed monthly price of $99 for insulin products for patients who pay cash in the United States. One month later, Eli Lily announced that it would launch a generic version of its Humalog insulin injection at a list price 50% lower than Humalog's price.

Some U.S. health insurers and states also have taken action to curb patients' insulin costs.

Novo announces lower-cost insulin products

Novo on Friday announced that in January 2020 it will begin selling authorized generic versions of its Novolog and Novolog Mix insulin treatments in the United States. The generics will be priced at 50% of the brand-name drugs' current list prices.

Novo also announced that in January 2020 it will launch a $99 cash card program that will allow patients, regardless of their insurance status, to purchase three vials or two packs of the company's analog insulin pens—which the company said contain a one-month supply of insulin for most diabetic patients—for a flat fee of $99.

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The changes are intended to "help patients who need lower-cost insulin," according to Novo CEO Lars Jorgensen.

However, Novo said while it will continue taking steps to "address affordability challenges in the short-term, changes within the system are required to make sustainable and meaningful affordability a reality." For instance, the company said "more needs to be done to improve how insurance benefits cover vital medicines, especially through high-deductible health plans."

Stacie Dusetzina, an associate professor of health policy at Vanderbilt University, said Novo's actions likely will help lower patients' insulin costs. However, she said moves will not "fix a long-standing problem, which is that insulin is very expensive" (Jacobsen, Reuters, 9/6; Liu, FiercePharma, 9/6; Silverman, "Pharmalot," STAT+, 9/6).

New report: 4 steps needed to realize pharmacy’s full value

Pharmaceutical spending has risen at a rate higher than any other component of health care spending. Those liable for pharmaceutical costs—including private health plans, employers, and the federal government—are taking drastic steps to try to curb the rate of spending growth.

To learn four steps all providers can take to control pharmacy costs and meet growth ambitions, download our new research report.

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