The World Health Organization (WHO) announced that they will begin a pilot program to prequalify generic insulin products for low to middle-income countries, which will increase access to insulin at lower prices. It is important to understand why such an effort to increase access to low-cost insulin treatments is needed in the first place, and how the United States still lags behind on this issue.
In contrast to many commonly used medications, insulin is a biologic drug. This means that the drug is derived from living organisms rather than from a series of chemical reactions. Originally, insulin was extracted from animals like pigs or cows. In the 1980s, drug companies marketed synthetic insulin derived from bacteria genetically engineered to produce insulin.
Insulins being a biologic drug creates a problem. Under U.S. drug regulatory laws, “generic” insulins are technically listed as a “biosimilar” or a “follow-on” rather than an actual generic. Biosimilars are required to follow a different set of approval procedures and qualifications. Where a generic drug must have exactly the same active ingredients as its original, biosimilars must only be similar in terms of potency, purity and safety.
Furthermore, because biosimilars of insulin are not the exact same molecule as its original, regulatory laws require additional levels of testing that actual generic drugs do not need. This means that insulin is difficult to turn into a biosimilar, with a process that approaches both the complexity and cost of introducing a whole new drug to the market.
As a result, three major pharmaceutical companies - Eli Lily, Novo Nordisk and Sanofi - have dominated global sales for insulin products, representing about 90% of market share.
These companies have also utilized strategies to further their hold on the insulin market, including “evergreening,'' a process where they make a series of small changes to the drug to renew patents on them, and direct payments to competitors to not develop biosimilars for a period of time.
Biosimilars and the Market
There are several biosimilars already on the U.S. market. The problem is that the majority of them are produced by the same company that produces the original. Eli Lily sells Lispro, a biosimilar of its brand name Humalog ($275 per vial), for about 50% off at $137. Sanofi sells its biosimilar for only 15% off the brand name price. Novo Nordisk announced that they would also introduce a biosimilar for 50% off their list price of their original, as well as a $99 per month cash card program for qualifying patients.
However, even a 50% reduction in price from the original does not represent much of a difference to patients who face rising health care costs. Many diabetic patients have out-of-pocket costs for insulin that can reach more than $1000 per month, even with health insurance.
The problem is worse in context: the price of a vial of Humalog has increased from $35 in 2001 to $275 in 2019. Compare this with the price of insulin in Germany, where a vial of Humalog is around $55 and patients might pay as low as $11 every three months to maintain an insulin prescription.
The Future for Generic Insulin
For the moment, there does not appear to be any major solution coming down the pipeline for patients.
Various bills and plans have been proposed, including allowing importation of cheaper drugs, linking prices to those found abroad, reducing pharmaceutical middlemen called pharmacy benefit managers (PBMs) that cause higher prices for patients, reducing prices of insulin to 2006 levels and others that address strategies drug companies use to keep away generic competition. However, not much movement has been made on these proposals, and short term relief is unlikely for the time being.
Other biosimilars are in the works, and the FDA announced regulatory changes coming in March 2020 that might ease the burden for insulin biosimilars to enter the market, but it remains to be seen if either will help patients with costs in a meaningful and timely manner.