- The average list price on a widely used insulin called Humalog U100 rose 52%, or more than $200, from 2014 to mid-2017. Yet the average price its manufacturer Eli Lilly realized per patient, per month for Humalog — provided it was being used as prescribed — went down around 8% over that time period.
- That divergence was highlighted in a new report from the pharma which, at least in part, aims to provide a more detailed view of drug pricing decisions to Lilly shareholders. Previous installments of the report offered pricing information on Lilly's portfolio as a whole, but this year's marks the first time the company has broken down list and net prices for an individual product.
- The transparency efforts come as Lilly and other big diabetes drugmakers face intense scrutiny over the rising list prices on their medicines. Insulins have been a particular focus, as more and more patients report that high costs are forcing them to ration their supply or seek cheaper, sometimes extreme alternatives.
Lilly hasn't raised the list price on Humalog U100 (insulin lispro) since May 2017. Even so, that price still sits at nearly $600 — well above the $391 it was going for back in 2014. A database of drug pricing information cited by The Wall Street Journal indicates the list price for one vial of Humalog has nearly tripled over the last decade.
It's not just Humalog either. That database found similar list price increases for Novo Nordisk's Novolog (insulin aspart) and Sanofi's Lantus (insulin glargine), according to the Journal. Sanofi also recently released data showing the list prices on its U.S. insulin products have gone up 126% since 2012, although net prices have fallen by 25%.
Those figures haven't sat well with lawmakers. The powerful Senate Finance Committee in February launched an investigation into insulin prices in the U.S., sending letters to Lilly, Novo and Sanofi requesting information on how they priced their products over the last five years.
Though the probe specifically looks at insulin, it's reflective of a growing backlash against drug prices across therapeutic areas. Some patients are going without medication because of the associated out-of-pocket costs — which in turn has fueled the debate over how much each member of the drug value chain is to blame.
Much of that debate has centered on list prices versus net prices. The former are the initial prices drug manufacturers set for their products, while the latter is the price after accounting for the rebates and discounts given to payers in exchange for coverage.
Insurers and pharmacy benefit managers say the affordability problems start with high list prices. Manufacturers, meanwhile, argue that irrespective of list price, payers aren't passing along to patients enough of the savings from rebates and discounts that drugmakers provide.
Most patients don't pay the list price of a drug, but those with low incomes, no insurance or high-deductible insurance plans are especially at risk of having to do so. Amid the mounting criticism, Lilly in August opened the Lilly Diabetes Solution center to help those types of patients pay for the company's insulin products.
And earlier this month, Lilly said it will begin marketing an authorized generic of Humalog at a 50% discount to the product's list price.
"Those not well-served by the current system will have a better, more affordable option — which can also count toward their deductible," Lilly wrote of the generic drug in its new report. "But patients with health plans that prefer the current system won’t see any changes — Humalog will remain available."
The company also plans to have television commercials of its products include directions to a website where viewers can get information on list prices and average out-of-pocket costs for Lilly medicines. The website will initially include information on four drugs, including the Type 2 diabetes drug Trulicity (dulaglutide), though Lilly intends to provide information on other therapies later on, regardless of whether they're advertised on TV.
While those moves may appease some critics, Lilly and other insulin makers are sure to face more scrutiny over pricing. Humalog revenue totaled $3 billion worldwide last year and rose 4% in the U.S. That increase, according to Lilly, was primarily because of increased demand, but also because of higher realized prices from changes in estimates to rebates and discounts.