Two lawmakers from opposite sides of the aisle have teamed up to
ask three powerful health care industries to explain the rising cost of
insulin, an essential treatment for people with diabetes.
Insulin
was first discovered in 1921 by a team of biochemists and physicians who sold
the patent to a university for $3. The drug was once available for less than $1
a vial, but newer forms have been introduced at ever-higher prices — and they
keep climbing. A form of insulin that carried a list price of $17 a vial
in 1997 cost $138 in 2016. Another form that launched two decades ago at $21 a
vial rose to $255.
Reps.
Diana DeGette (D-Colo.) and Tom Reed (R-N.Y.) are both parents of children with
type 1 diabetes and leaders of the Congressional Diabetes
Caucus. They requested a meeting from the organizations that represent
the drug companies that make insulin, the
insurance companies that cover the drug and the pharmacy benefit managers that negotiate
prices on insurers' behalf. In letters to all three, they ask for help in untangling the
complicated role each business plays in the price of insulin.
“Insulin
is a life-sustaining drug for which there is no substitute,” DeGette and Reed
wrote. “For those who need it, not taking insulin can lead to poor health
outcomes, complications, and even death. However, people skip doses, fail to
pay rent or buy groceries, and even resort to an insulin 'black market' in
order to afford their insulin. No one should be forced to make these incredibly
difficult choices.”
Understanding
insulin's rising price is far from straightforward. Drugmakers, for example,
often point out that the list prices aren't really the price anyone pays,
because of rebates negotiated in secret. They argue that while insulin list
prices may have soared, their profits from the drugs haven't kept pace because
of ever bigger rebates being negotiated by pharmacy benefit managers, the
companies that work on behalf of insurers.
Meanwhile,
some insurers and employers have questioned whether the rebates negotiated by
the pharmacy benefit managers are really being passed on to them.
Patients,
who increasingly enroll in high deductible health plans, may find themselves
paying a supposedly fictional list price for a drug while knowing that their
insurer gets a secret discount — something drugmakers say was never intended to
happen. Or patients may find that the insulin they've used for years is no
longer covered because of secret deals that insurers strike with companies to
exclude competitors and save money. Meanwhile, patients' portion of the price
may not decrease.
“This
is why I think we need to get everyone in one room — a series of hearings that
we need to have, so that we can try to piece together, number one, how the
system became so complex and number two, what congressional action we can take
to remedy it,” DeGette said in an interview. (The letters do not announce a
hearing but invite industry leaders to meet and discuss the problem and
possible solutions before the end of July.)
Reed
said that he has personally seen the price of his son's insulin increase and
heard from people affected by diabetes about their struggles to afford insulin
that they've taken for years and is suddenly rising in price.
He said
he understands the idea that risky research and development needs to be
rewarded but points out that the insulin his son uses has been on the market
for years, without any improvements as the price rose. He notes that insurance
coverage may be shifting costs onto patients in different ways.
“Why is
this occurring — is it truly a lack of transparency?” Reed said.
This
isn't the first time that lawmakers have questioned the rise in insulin
prices. Sen. Bernie Sanders (I-Vt.) and Rep. Elijah E. Cummings (D-Md.) became
concerned about competing insulins whose prices rose in lockstep last
year. They asked the Federal Trade Commission to investigate
the possibility the pattern could indicate price collusion.
Carolyn
Johnson is a reporter covering the business of health. She previously wrote
about science at The Boston Globe. Follow @carolynyjohnson
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