“Viewpoints” is a place on Chapelboro where local people are encouraged to share their unique perspectives on issues affecting our community. If you’d like to contribute a column on an issue you’re concerned about, interesting happenings around town, reflections on local life — or anything else — send a submission to viewpoints@wchl.com.
People Think the American Insulin Crisis Is Over. Let’s Make Sure That It Is.
A perspective from Tyler Smith
For the last two decades, American diabetics have faced a dire crisis with unaffordable insulin prices. Recently however, the three leading insulin producers simultaneously announced immediate price cuts. The move has been celebrated by politicians, advocates, and diabetics alike. This moment marks a massive milestone and is a clear testament to the power of public pressure. However, anyone who says that the Insulin Crisis has now ended is sorely mistaken. The Insulin Crisis cannot be completely over until Americans are guaranteed certainty—through federal legislation—of their insulin supply.
Let’s review the history leading up to this moment. In the early 1920s, Dr. Frederick Banting and his colleagues achieved a miracle by successfully creating injectable insulin. Dr. Banting sold the patent for insulin for $1, declaring: “Insulin does not belong to me, it belongs to the world”. However, Dr. Banting’s gift was slowly exploited for greed. Insulin’s production gradually concentrated into three companies (Eli Lilly, Novo Nordisk, and Sanofi) which currently control 90% of global insulin production. Between 1999 and 2019, these three companies increased American insulin prices by 1,000% while not changing prices in countries with insulin price caps. Americans now pay $332 per vial of insulin, which amounts to about $8,000 a year. Insulin’s unaffordable price has subsequently destroyed countless lives. Of the 7.4 million insulin-dependent diabetics, one in four have been forced to ration insulin—a lethal practice that leads to hospitalization and even death.
The pharmaceutical industry conjured every defence in justifying insulin’s price for years. They claimed that heavy manufacturing costs necessitated the high American price. Critics shot back citing that insulin’s estimated production cost is just $6 a vial. The industry then claimed that high prices went towards immense research and development (R&D) costs. Critics pointed out that not only did the industry’s net revenue “dwarf” R&D expenditures; but also that pharmaceuticals spent more in stock buybacks than R&D. The industry then claimed that pharmacy benefit managers (PBM) and their rebate systems were another factor in high prices, even though there was proof that regulating PBMs would not have likely had an impact on insulin prices.
While making these arguments, insulin manufactures made billions from millions of chronically ill Americans. Sanofi extracted over $40 billion between 2004 and 2019, Eli Lilly’s insulin generated $23 billion since 2002, and Novo Nordisk’s insulin pricing has been a primary driver for its growth rate over the last 10 years.
Yet last month, all insulin manufacturers simultaneously cut their insulin prices out of seemingly nowhere. After years of arguing that low insulin prices were an impossible fantasy, the pharmaceutical industry made it reality overnight. The contrast hints at two distinct possibilities. Either the industry somehow drastically reduced R&D costs and resolved their PBM problems, or they were terrified at the prospect of federal regulation. My bet is on the latter. The only way the industry’s decision makes sense is if they perceived a real threat of the government permanently limiting their price-setting capabilities. We must therefore realize that the insulin manufacturers have completely discredited themselves. They could have cut prices at any time over the last twenty years. Instead, they skyrocketed prices for billions in profits while intentionally lying to the American public.
With that in mind, we must now analyse the actual change that the industry has put forward. Eli Lilly, Novo Nordisk, and Sanofi all released statements announcing the price cuts, which will be effective in the coming months. However, not a single statement mentioned how long they will keep lower insulin prices. The omission is not accidental; it is deliberate. They have purposefully not disclosed the price cut’s duration so that they may retain future price setting capability. Given the industry’s previous deceptions and self-serving nature, it’s possible they may raise prices in the future. All they would have to do is wait for the public to forget about the issue and for a more pharma-favorable government to take power. The lethal threat of the insulin crisis therefore remains, even if it has been temporarily submerged. Advocates have already recognized this threat. Politicians have too, as exhibited by Sen. Bernie Sanders (I-VT) and Rep. Cori Bush (MO-01)’s recent introduction of a federal insulin price cap.
The industry’s lowering of insulin prices is a moment to celebrate our progress on the issue, but not its resolution. It’s taken two decades of struggle to achieve the impossible: scaring the pharmaceutical industry into voluntarily doing what’s right. We cannot however trust the industry to continue doing so. We now have a small window to end this issue permanently, which we must take advantage of. The lives of millions of Americans are in the balance. We must finish the fight and pass a federal insulin list price cap to irreversibly end the American Insulin Crisis.
“Viewpoints” on Chapelboro is a recurring series of community-submitted opinion columns. All thoughts, ideas, opinions and expressions in this series are those of the author, and do not reflect the work or reporting of 97.9 The Hill and Chapelboro.com.
