Insulin costs now capped for more Americans
More patients on insulin will pay less for the drug this year after a leading manufacturer joined rivals in curbing monthly costs or lowering prices.
Why it matters: Amid a broader debate over high drug prices, rising insulin costs sparked outrage given that it's an old drug that millions of Americans with diabetes depend on.
- The drugmakers' recent moves to curb insulin costs also represented a win for the Biden administration, which pressured companies to make the products more affordable after the Inflation Reduction Act capped monthly insulin costs at $35 in Medicare.
Driving the news: As of Jan. 1, insulin maker Sanofi capped monthly out-of-pocket costs at $35 for its most popular product, Lantus, for patients with private insurance. Patients without insurance have already been able to get it at that cost.
- Sanofi's move was announced last March — around when key rivals Eli Lilly and Novo Nordisk also announced cost-cutting measures — but it didn't take effect until Jan. 1.
- Lilly capped monthly insulin costs at $35 for patients with private insurance at some retail pharmacies, and people without insurance can also get it for $35 per month.
- Novo last year announced it would slash the list prices of several insulin products by 75%, effective Jan. 1, with its lowest price at $48.20. Novo also runs some programs that allow customers to pay as little as $25-$35 for insulin per month.
Between the lines: Like Novo, Sanofi and Lilly also had announced major reductions in some insulins' list prices, which don't account for any rebates or discounts negotiated by insurers or companies that manage drug benefits.
- By reducing list prices, the companies are expected to save hundreds of millions of dollars per year because of a change in federal law that also took effect in the new year.
- Companies who raised drug prices faster than inflation have been required to provide higher rebates to Medicaid, the program covering low-income Americans.
- As of Jan. 1, the rebate amounts are no longer capped, meaning some companies may essentially have to pay Medicaid to provide the drugs to enrollees.