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Tag: Eli Lilly

  • Lilly breaks its promise to offer lower-cost insulin

    Lilly breaks its promise to offer lower-cost insulin

    Eli Lilly may be talking the right talk when it comes to insulin prices, but it is not walking the walk, according to a report by Senators Richard Blumenthal and Elizabeth Warren. Eli Lilly’s new generic version of Humalog, Lispro, which it promised to sell at lower cost, tends to be out of stock at pharmacies. And, when surveyed, many pharmacies did not know it was even available.

    Senators Blumenthal and Warren surveyed 190 chain pharmacies and 196 independent pharmacies across the US about the availability of lower-cost insulin over a five-month period in 2019. And, it found that lower-cost insulin is hard to find. Only 17 percent of pharmacies had it in stock.

    What’s worse, the pharmacies that did stock Lispro were not telling their customers about it.  And, nearly seven in ten pharmacies that did not carry Lispro reported that they could not order it. Instead, prices for insulin are sky high.

    It’s not clear why insurers have not been informing their members to use Lispro. Stat News reports that many insurers do not even include Lispro on their formulary. Rather, insurers are driving up costs for people with diabetes.

    Warren and Blumenthal believe that it’s time that Congress took action to rein in high drug prices. In the meantime, they want Lilly to deliver on its promise and lower the price of insulin. It charges far lower prices abroad for Humalog.

    Some 30 million Americans have diabetes, more than one in every nine people. The price of insulin should be very low, given that it was discovered 100 years ago. Instead, its cost has more than tripled in the last 20 years. The cost of a 10 ml vial of Humalog is nearly seven times what it was in 2001, $275 today as compared with $35 in 2001. A typical person with diabetes uses between two and four vials a month at a cost of about $1,000.

    Of course, people with drug coverage typically pay only a small fraction of the cost at the pharmacy. But, everyone with insurance pays high premiums because the cost of drugs are so high. If insurers are not covering the generic version, they’re likely also making money off the higher cost.

    Given their findings, Senators Blumenthal and Warren question whether generics can deliver Americans the low prices people assume they deliver. They offer several recommendations to address the high cost of insulin and other critical and life-saving drugs. First and foremost, they say that Congress must act to reduce the price of drugs across the US, including for people with Medicare. Congress should also allow safe importation of drugs. And, it should allow the federal government to develop generic drugs, including insulin, when the market is not producing them as it should.

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  • Former Lilly employee reports that drug prices are set to maximize profits

    Former Lilly employee reports that drug prices are set to maximize profits

    Does Congress understand that pharmaceutical companies can and do set drug prices to maximize profits, without regard to their research and development costs? If they have any doubt, members should read Fran Quigley’s piece in Common Dreams about Frances Leath, a 15-year former Eli Lilly employee in its business development and strategic planning unit. She watched her bosses at Lilly set drug prices at thousands of times their cost.

    By the time Leath left Lilly, she found it emotionally and physically challenging to be there. In her words, “I felt like I was participating in things that conflicted with being a Christian.”

    Among other drugs, Lilly manufactures Humalog, insulin. Today, Humalog’s price can be as high as $275 a dose even though it costs Lilly about $5 to make. In 1996, Humalog cost $21 a dose. Lilly is pushing up Humalog’s price as high as it can, and people are dying because they can no longer afford it.

    Leath reports that it was not always this way at Lilly. The company slogan in 1987 had been:  “We make drugs as if people’s lives depend on it.” But, then in 2001, Prozac, which had earned the company more than $2.5 billion a year, was going generic, and Lilly’s stock price fell by almost a third. The pressure was on to find a way to make up for the loss.

    Shortly thereafter, the FDA approved Lilly’s new drug, Xigris, for treating severe sepsis. Leath says Lilly at first planned to price it at $500 for a dose, 100 times its cost to manufacture. But, Lilly knew it could set a far higher price; its cost was irrelevant. So, Lilly ended up charging $6,500 a dose, after contemplating a $10,000 a dose price.

    Leath voiced concerns with her boss about charging prices without regard to cost that people could not afford. His response: “If Grandma is on the table, no one is going to blink at paying $10,000 to save her life.” And, that became the rationale for Lilly charging exorbitant prices.

    What’s worse, Lilly could set a sky high price for Xigris even though it could not show that Xigris actually improved health outcomes. In the US, all the pharmaceutical company has to do to get FDA approval is to show that the drug is better than a placebo. It does not even have to show it is better than other drugs on the market. Germany has a far better model requiring such proof, which you can read about here.

    As it turned out, Lilly was making $100 million a year on a drug that was not benefiting patients. Xigris was eventually taken off the market in 2011.

    Of course, Gilead, Pfizer and every other for-profit pharmaceutical company also charge as much as they can for their drugs. Research and manufacturing costs are irrelevant to the drugs’ price. The only question is what price the market will bear. And, because insurers and Pharmacy Benefit Managers can also benefit from high drug prices, they are willing to promote costly drugs, incentivizing drugmakers to set high prices.

    Like virtually all corporate executives, pharmaceutical company execs focus first and foremost on generating profits and raising stock prices. So long as they can charge astronomical prices for their drugs, they will. Indeed, their success usually depends on it.

    If Congress cares about ensuring prescription drugs are affordable, it must step in and regulate drug prices for everyone in the US, just like every other country does. The only reason drug prices are as high as they are is because Congress awards drugmakers monopolies and then does not regulate drug prices.

    The simplest and fairest way to set drug prices is through international reference pricing, setting prices in the US at the average of what other wealthy countries pay.

    If you want Congress to rein in drug prices, please sign this petition.

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  • The price we pay for insulin

    The price we pay for insulin

    Insulin was discovered 100 years ago. Still, pharmaceutical companies marketing the drug are making enormous profits from it today by patenting new formulations and ways to deliver it. The price we pay for insulin is enormous, both in monetary terms and in lives lost.

    StatNews reports that in the 11 years between 2002 and 2013, the price of insulin has nearly tripled for the 30 million Americans who need it. The list price for one vial of insulin (diabetics generally need two to four vials each month) is now more than $250. Humalog, one insulin drug, has gone from $21 to $255 a vial in 20 years.

    The cost of insulin does not have to be so high for pharmaceutical companies to profit handsomely. A BMJ Global Health study found that it should not cost more than $133 a year to produce rapid or long-acting analog insulin treatments, and it could cost as little as $78. Human insulin should cost as little as $48 a month to produce.

    The authors of the BMJ study report that $100 a year for long-acting insulin seemed like a fair price for people with Type 1 diabetes. Yet drug companies are charging the US more than 12 times that, $1251.

    The problem is that pharmaceutical companies can set their prices for brand-name insulin. So, they charge as much as eight times more than their cost.

    Companies like Sanofi, which manufactures insulin, suggest that the solution to high insulin prices is for insurance companies to pay more for insulin so that diabetics pay less. That is no solution. It simply shifts costs, raising health insurance premiums, without reining in health care spending.

    Pharmaceutical company patient assistance programs are no solution either. They too do nothing to rein in health care spending.

    Some lawmakers claim that Eli Lilly, Sanofi and Novo Nordisk, all of which market insulin, are engaged in price collusion. And, 11 diabetics have filed a class action lawsuit claiming fraudulent pricing by these companies under federal RICO and state consumer protection laws.

    The Congressional Diabetes Caucus, a bipartisan group of nearly 300 Congresspeople, which was formed more than 20 years ago, has issued a report listing a variety of ways to address the rising price of insulin. Many of their suggestions will not rein in the price, for example, transparency in insulin pricing. But, the focus and pressure on the pharmaceutical companies could lead to more meaningful action.

    In the meantime, Americans with diabetes and their families continue to struggle to afford needed insulin. Some are forced to go without it and die. Their families are organizing to protest the price of insulin.

    If you want Congress to rein in drug prices, please sign this petition.

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  • Trump’s pick to head HHS drove up insulin prices at Eli Lilly

    Trump’s pick to head HHS drove up insulin prices at Eli Lilly

    Caitlyn McClure of the Other 98 reports that Alex Azar, President Trump’s pick to head the US Department of Health and Human Services (HHS), is a Pharma executive who drove up insulin prices at Eli Lilly. If confirmed, Azar can be counted on to help Pharma and disregard the public interest in having HHS ensure Americans good affordable health care.

    Over the last 50 years, Eli Lilly has paid billions of dollar in settlements for illegal marketing of drugs, bribery, and the sale of unsafe products. Ten years ago, the FDA charged Lilly with misleading marketing of dog medicines.

    Today, Eli Lilly is embroiled in allegations around insulin price fixing. At least five states are investigating Lilly for raising insulin prices to the same level as its competitors. In addition, a federal class-action RICO (Racketeer Influenced and Corrupt Organizations Act) suit has been brought against Lilly.

    Azar was president of Lilly USA in 2012. During his ten-year tenure at Lilly, Lilly tripled its price for insulin and hiked up prices on other drugs to increase its revenue. It created no new drugs. James Elliott of The Nation reports that Lilly’s Humalog, an insulin medicine, costs more today than it did in 1996 when it came to market. In the last 10 years, while Azar was at Eli Lilly, its list price went from $74 to $269.

    McClure points out that Trump’s selection of Azar as HHS head is at odds with Trump’s alleged goal of keeping Pharma from “getting away with murder.”

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