In May of last year, Alec Smith, a 26-year-old living in Minneapolis, died from a lack of insulin. Smith was diabetic and insulin was essential to manage his disease. Because he was no longer under his parents’ health insurance policy and was unable to afford his own, he couldn’t afford the daily insulin he needed to live. He was forced to ration his insulin, causing severely unregulated blood sugar that ultimately killed him.
As shown by this tragic story, insulin prices are unreasonably high; this significantly influences the quality of life of diabetics. There has been a 300 percent increase in insulin prices over the past decade. In 2008, insulin sold for $75 a bottle, while today insulin prices are over $300 per bottle. One bottle typically lasts two to three weeks. While this might not affect those who have good insurance coverage, it greatly affects those who have a high deductible or are uninsured, like Alec. One in four diabetics in Hennepin County are paying out-of-pocket for their diabetes care. This puts these individuals in a position where they may have to choose between buying a life-sustaining drug (insulin) or buying groceries or paying electric bills. These diabetics find themselves rationing their insulin or not being able to purchase it at all, leading to hospitalizations from poorly managed diabetes. Rising insulin prices and preventable hospitalization visits are the main reason diabetic adults will pay $8,000 more in annual health care costs than a non-diabetic adult.
Lack of competition
One contributor to the exponentially rising insulin prices is the lack of competition. There are no biosimilar (generic) insulins. Because generic drugs are typically sold at a lower price, brand name drugs must match that price to be competitive within the drug market. Without generics, insulin companies do not have that incentive to match a lower price. So the three main insulin companies, Eli Lilly, Novo Nordisk, and Sanofi, control the entire insulin market with brand name drugs.
In Minnesota, there has been notable action in the fight to lower insulin prices. Recently, Minnesota Attorney General Lori Swanson sued the three insulin companies listed above for price-gouging diabetic patients. Minnesota is the first state to file a lawsuit against these manufacturers. In response to the lawsuit, the three insulin manufacturers are shifting the blame of high medication prices to pharmacy benefit managers (PBMs). PBMs negotiate prices with insulin manufacturers and insurance companies and help decide which drugs will be on insurance companies’ preferred lists. PBMs profit from rebates off list prices of insulin, so the higher the price of insulin, the bigger the paycheck for PBMs. While PBMs play a role in insulin prices, they do not carry all the blame. Change implemented at the manufacturer level can help lower insulin prices.
An opportune time to pass legislation
Nicole Smith-Holt, the mother of Alec Smith, led a rally at the Capitol in St. Paul last spring. This “Insulin Day of Action,” was organized to urge lawmakers to address prescription drug prices, and afterward Minnesota state legislators drafted two bills addressing insulin prices. These bills would allow the state to purchase insulin at a discounted bulk rate and then offer the medication at a low cost to diabetics in emergency situations. Neither of the bills made it far enough in the legislative process to be voted on during the last legislative session. With new progressive, health-care-focused leadership in the Minnesota House, the new session is an opportune time to reintroduce these bills.
Diabetes is the 7th leading cause of death in Minnesota. One of the reasons diabetics are dying from the disease is because they are unable to keep up with the rising prices of insulin, the drug they rely on to live a healthy life. No diabetic in Minnesota should have to struggle the say Alec Smith did. A life-saving drug should not cost so much that people are dying because they can’t afford it. Policy change needs to be implemented to prevent another tragic story like that of Alec Smith.
Emily Martin is a master of public health student at the University of Minnesota School of Public Health.
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