Saturday, June 20, 2020

Going Diabetes Old-School During the Pandemic

During the recent pandemic (between March and June 2020, although we are still not completely out of quarantine, we are now in Phase II of reopening), I decided to go old-school on diabetes supplies.

Specifically, I went back to one of the many old blood glucose meters I'd saved over the years. All of them still worked, although I discarded a few for which test strips are no longer sold or had leaked battery acid in the battery compartment.

I made a notable exception for one particular meter model...

Specifically, I had saved a few of the OneTouch Ultra (1) meters I had in my possession. I also had a few OneTouch Ultra 2 meters in inventory, but opted for the original older model because the batteries in all of the meters in my possession were either completely dead or had been removed. The original OneTouch Ultra (1) meter required just a single #2032 battery, whereas the Ultra 2 meter required two of the same batteries. I was able to get a few of those batteries in a dollar store I visited over Memorial Day weekend, so it wasn't a major investment -- it was $1.00.

Going Diabetes Old-School

The reason I went old-school on testing supplies was because I had a pretty large stash of unused test strips which had been given to me by a clinical trial I opted not to participate in (there were some possible adverse events I really did not want to risk experiencing, and there was a good chance I would have been in the "control" group meaning I would not benefit from the treatment anyway, so it just seemed like more trouble than it was worth to participate in that trial). Although the strips in my possession had officially expired (they were more than three years past expiration date), when I tested myself (I repeated the trial on several occasions) using both an unexpired box of the "good" new test strips and the slightly older but technically-expired old test strips, the readings were nearly identical (or within 1-5 mg/dL). That was good enough for me.

Since I was at home for the entire time under quarantine (as was most of the NYC region), I saw little to no risk of using up the old (expired) inventory. I kept using the old system by buying even more inventory from a third-party manufacturer of test strips. Specifically, I went with the Unistrip1 brand of strips made by a company known as Unistrip Technologies, LLC although they actually subcontract the manufacture of their strips to a third-party contract manufacturer. That firm, based upon the last FDA filings I was able to find, appears to be OK Biotech Co., Ltd. which is located in Hsinchu City, Taiwan.

Unistrip1 is a brand of generic test strips which work in the old J&J Lifescan OneTouch Ultra blood glucose testing system. As noted, I also restocked some replacement strips for a fairly low cost. I acknowledge that in 2014, there was an FDA recall  of Unistrip's test strips. But that recall was not extended by FDA and I have not seen any further issues. As the J&J litigation and attempts to spread bad word-of-mouth on the product subsided by the fact that J&J sold the business to a private equity firm a few years ago, that has kind of died down. My own comparison tests proved they were fine for my needs while I was quarantined.

But generic replacement strips are now sold online for about $0.10/strip to $0.20/strip (depending on the quantity purchased) by using a strip made by another manufacturer sold from one of the many different suppliers online. I used price to drive my decision on which one (the lowest price won, I went with a company called Medical Supply Corner which wasn't the fastest delivery but offered low-costs and free shipping), and I bought like another 300 test strips which I am now very close to exhausting. In the meantime, I also refilled the formulary brand (which happened to be Lifescan Verio IQ) since that was Cigna's preferred formulary brand of test strips at the time. But I was recently switched from Cigna to Aetna, which means switching to Roche Accu-Chek meters and strips. Once the insurance broker properly loads up the deductibles (so they don't charge as if I had not already met it - which I have), then I plan to order that brand in the maximum quantity I can.

I had previously used the old OneTouch Ultra meter quite extensively in the past. About the only significant change I really noticed compared to the OneTouch Verio tests which aimed to replace that (when faced with a number of generic competitors for the strips) is that Lifescan decided to replace them with Verio which was incompatible with the old meter/strips ... I don't think they even make the meters anymore, although they do make the strips themselves. Right now, there is a lot of unused inventory of the old meters still available for purchase at retailers around the country. The biggest change was the need for calibration, which was a temporary hassle. Most modern blood glucose test systems have abandoned the calibration requirement. It put more burden on the patient for the manufacturers' decision not to control their manufacturing as tightly as necessary. The Verio test strips also have a design which are narrower at the top of the strip,  and because they use real gold as the conductor metal (its cost-effective), that design modification saves Lifescan money. The other very annoying thing is that the old Ultra meter its a multi-step process to get the last reading; first you must scroll through useless averages of the past 15 and 30 days -- which is very annoying when you're trying to get your last reading. But the results of the testing in both systems are equally reliable.

But Lifescan's (a business which J&J sold back in 2018 to the private equity firm Platinum Equity for $2.1 billion), OneTouch business opted to effectively stop support of the old OneTouch Ultra system because it started being used by rivals who drastically undercut them on prices for strips. In a back-to-back comparison, they were nearly identical results (and there's no guarantees that OneTouch's were more accurate than Unistrip's were). If you're like me, the old inventory was already in my possession. So going "old-school" was a very viable and wise decision, especially since I already had that inventory in my possession and it was still perfectly valid. That bought me 3 months of testing supplies while I piggy-banked the brand new stuff for use at a later date.

It's The Rebates, Stupid!

I have grown tired of the games being used to secure preferred formulary placement. Pharma, or medical device companies, are essentially bribing insurance companies with undisclosed, secret and un-auditable "rebates". Back in the 1990's, the healthcare insurance industry lobbied the Financial Accounting Standards Board (FASB) for an exemption to net cost accounting standards ordinarily used in keeping financial records. That enables the insurance companies like United Healthcare, Anthem, Cigna, Aetna and others to collect millions in Rx "rebates" to use as they wish. As it turns out, most insurance companies do not keep the rebate dollars for themselves. Instead, they give the rebates to employers who buy insurance plans from them as "premium offsets". Employers are happy to take any discount off runaway premiums they can get. They generally do not ponder where the money actually comes from.

Most of the dollars associated with that excessive waste come from patients with chronic illnesses who use very heavily-rebated prescription drugs and medical devices (insulin happens to be one of the most heavily-rebated drugs in existence). That's why former FDA Chief Dr. Scott Gottlieb, at a March 7, 2018 conference organized by the National Health Policy Conference of AHIP (which is a lobbyist group for the health insurance industry), made national headlines when he essentially told the group that they were doing it [insurance] wrong.

Former FDA Chief Dr. Scott Gottlieb told the audience (see for more):

"Sick people aren't supposed to be subsidizing the healthy. That's exactly the opposite of what most people thought they were buying when they bought into the notion of having insurance."

Because the rebating system is opaque, and because of consolidation among PBM's (now wholly-owned business units of the largest insurance companies, with the exception of CVS Health, which acquired an insurance company of its own: Aetna) and insurers who have steadily consolidated into a few, nationwide giants. He said that rebate system can result in ever-higher drug prices and everyone from drugmakers to the middlemen to insurers are all taking a slice of the pie.

Moreover, he posited, there’s a "perverse incentive" to spread the benefit of those rebates across plan members, rather than applying them directly to lower the costs of drugs for the sickest patients — thus, it is a system where the sick actually subsidize the healthy.

Gottlieb said "Patients shouldn’t face exorbitant out-of-pocket costs, and pay money where the primary purpose is to help subsidize rebates paid to a long list of supply chain intermediaries, or is used to buy down the premium costs for everyone else."

He continued: "Is a patient really in a position to make an economically based decision? Is the co-pay going to discourage overutilization? Is someone in this situation voluntarily seeking chemo?" (or, for that matter, diabetes, which is treated with the most heavily-rebated drugs in existence).

The answer, of course, is no. "Yet the big co-pay or rebate on the costly drug can help offset insurers' payments to the pharmacy, and reduce average insurance premiums," Gottlieb said.

"Too many benefit plans operate like reverse insurance," Adam Fein, CEO of Drug Channel Institute, wrote in an email to CNBC. He added that "The sickest people taking medicines for chronic illnesses generate the majority of manufacturer rebate payments. These funds are then used to subsidize the premiums for healthier plan members."

He's right about that. And yet, no efforts to change the messed up system have (so far) been successfully implemented. Early efforts by the Trump Administration all failed. Congress has also largely ignored the secretive rebate system that pushes the prices of Rx drugs in the U.S. steadily upward. The best short-term outcome is one I mentioned in my previous post: price caps.

Many people mistakenly blame pharma. To be sure, pharma companies invented rebates and have worked tirelessly to preserve that system, so they certainly share blame for it. But along the way, pharmacy benefits managers (PBM's) and insurance companies merged relentlessly and are now as big as pharma. They also OWN the largest PBM's, too.

The logical question  that no one is willing to answer is "Where the hell is all that Rx rebate money going?"

Adam Fein himself offers some answers with proof. Most of the money is going to employers. On March 12, 2019, he cited data from the the Pharmacy Benefit Management Institute's (PBMI). The data in their reporting (see Adam Fein's post at for more details) suggest that employers, also known as "plan sponsors" are the party receiving most of the Rx rebate dollars. If they aren't passing them on to you, odds are that your employer is receiving the Rx rebate money collected by pharmacy benefit managers. Note that the PBMI surveys cited collect data from employers, not PBM's. However, he does note that employers' rebate agreements with PBM's vary widely.

But PBMI's data shows that more and more employers are receiving 100% of the rebates negotiated by their PBM. For larger employers in 2018, 100% rebate pass-through was the most common rebate arrangement. Both figures had increased significantly since 2014. For 2018, smaller employers were slightly less likely to receive 100% of the rebates for traditional and specialty drugs. This approach was still the most common arrangement for traditional drugs and for larger employers regarding specialty drugs.

But Fein observes that larger employers were more likely to receive guaranteed minimum payments with 100% rebate pass-through. Among the employers that received 100% of rebates, 59% of larger employers had a guaranteed minimum rebate amount for traditional drugs and 47% did for specialty drugs. Only 49% of smaller employers had a guaranteed minimum rebate amount for traditional drugs and only 16% did for specialty drugs.

Employer Size Isn't As Important As It Once Was

One other thing is critically important to note here. Large vs. small employers is increasingly less relevant. The reason is because most smaller employers, rather than using a broker to secure insurance benefits for themselves only, are increasingly likely to abandon that in favor of a Professional Employer Organization (PEO) rather than buying benfits directly from insurance companies using a broker. Not all do, but an ever-growing percentage do. We can expect that trend to continue for simple economic reasons.

Last year, the largest PEO was ADP Totalsource. ADP Totalsource is the official employer of record for more Americans than any American company other than Walmart Stores, Inc. (I once worked for a company that used a PEO, and the PEO they used was acquired by ADP, at which point, the company ended the relationship and hired a different PEO instead). By virtue of being so large, PEO's can negotiate lower insurance premiums than all but the largest employers of the past. Think of companies like General Motors. ADP is bigger than they are based upon number of employees. And, a tiny business consisting of less than 10 employees can theoretically hire ADP Totalsource to manage payroll, tax disclosures, benefits, unemployment claims, etc.

That's a market solution to an issue that once put small businesses at a disadvantage to large ones when it came to buying benefits like healthcare insurance.

The U.S. has a major problem with prescription drug and medical device rebates which lawmakers are going to have to fix if U.S. prescription drug prices are to come back down to earth. The good news is that lawmakers seem to be increasingly aware of the real problem, which are the invisble "middlemen" in between the manufacturer and the patient. I blame insurance companies most for the problem. They are taking the money, giving it to companies who buy their insurance plans, while allowing patients to be charged artifically-inflated prices. They are most responsible (not solely, but they bear a larger responsibility) than most are willing or competent enough to acknowledge.

In the end, my trip going old-school on testing supplies was surprisingly cost-effective, and I would encourage others to consider similar actions if they are struggling to manage costs.

Author P.S.

Since I was home for more than 3 months, something else I did in my "old-school" experience was used up my old (nasty) glucose tablets rather than using up preferable (and more costly) Glucose Liquids (called Glucose Shots at Walmart stores and several other retailers). While CVS and others now offer what they call "soft" glucose tablets, gummies and gels which were not available in the past, I had an inventory of the old-school tablets which you'd break your molars on if they did not rot them with cavities first, and I decided to try to use old-school ingenuity to use those too. Guess what? I found that by soaking them in very hot (not boiling) tap water for about 45 minutes until they haven't quite liquidated yet are clearly softening. Then, drain the water without out removing the tablets from the container (such as by holding your hand over them in the kitchen sink). I used flat containers designed for olive oil meant for dipping bread in, but a bowl will work similarly; only add enough water to cover the tablets. You may even leave a tiny bit of residual water in the dish, and just let the moistened tablets to sit for another day or two until the water is completely evaporated and the tablets have started to harden once again.  I ended up making my old tablets usable again without destroying my teeth. Anyone who argues they require precise measures probably won't like it, but I wasn't concerned if a tiny bit of sugar disappeared. But when you need a tablet (or three), they will be soft and dissolve in your mouth without even having to chew them. Try it. Its yet another way to bring old products back into utility.

Monday, February 17, 2020

States Aren't Waiting for DC to Regulate Insulin Prices, They're Doing It Themselves

Back in March 2018, I co-authored (along with Scott King, the former editor of Diabetes Health magazine) an article (catch the article at for reference) about some patient advocacy wins and challenges ahead. One of the challenges ahead was about runaway insulin prices.

We started to see action on runaway insulin prices in state capitals happen a few years ago.

Nevada got an early start in 2017, introducing a transparency bill that requires drugmakers who made insulin specifically to report pricing, costs, and rebates. It was signed into law by the state's Republican governor. The go-to industry response was to sue Nevada in Court. But when two lawsuits from PhRMA and BIO were both thrown out of court because the industry failed to demonstrate they would suffer financial harm from complying with the law, it went into effect. Nevada's price-transparency law irritated the hell out of the pharmaceutical industry, but they lost in Court (see for detail) and as non-compliance fees started growing, they were forced to comply, albeit reluctantly. But the Nevada law did not do much to impact runaway prices, but it did enable Nevada lawmakers to better understand the problem.

Colorado acted in May 2019, implementing a cap on co-payments of the lifesaving medication at $100 a month for insured patients, regardless of the supply they require (see for more). The law aimed to shield patients from dramatic insulin price increases seen in recent years. Under the Colorado law, insurance companies must cap co-payments for insulin at $100 a month for insured patients, regardless of the supply they require. The Colorado law has since inspired many other states to do the same. Insurance companies will have to absorb the balance. In reality, the money really belongs to patients, as insulin generates the cash rebates which insurance companies fail to pass-on to patients, and instead charge them an artificially-inflated price for insulin. Most insurance companies pass that cash on to employers, who happily accept any discount off growing premiums without considering that the source is patients with chronic diseases like diabetes.

Former commissioner of the FDA Scott Gottlieb made big headlines at a conference on March 6, 2018 which was organized by the National Health Policy Conference of AHIP, which is a health insurance industry trade organization. Gottlieb delivered a startling message to the group when he told them:

"You're doing it wrong. Sick people aren't supposed to be subsidizing the healthy. That's exactly the opposite of what most people thought they were buying when they bought into the notion of having insurance." Dr. Gottlieb told the group. 

See for more information on Dr. Gottlieb's now-infamous speech.

As the Nevada experience shows, transparency, will not (by itself) fix problems with sky-high prices for healthcare including prescription drugs like insulin. It is but one part of a much larger problem which is a complete lack of transparency behind the costs of U.S. healthcare in every sector. Those costs are hidden, and kept hidden from the public. In order to fix the problem, you still need an audit trail, and forensic accountants can then "follow the money" to determine which parties are most responsible for the problem. Today, we don't have a tremendous amount of solid evidence, although all of the signs seem to point to healthcare insurance companies as the party most responsible for runaway insulin prices, not pharma. That means we still need price transparency, although we cannot expect that alone will bring insulin prices down.

For the record, a man named Avik Roy recently opined on this matter. He is a conservative health policy advisor whom I respect tremendously, even if I don't always agree with his views. Roy went to MIT to study molecular biology as an undergrad, and later attended the Yale School of Medicine. He was active politically at Yale, where he served as the chairman for the Conservative Party of the Yale Political Union. Mr. Roy was originally an investment analyst for several Wall Street investment banks (including both Bain Capital and J.P. Morgan), although he later worked on health care policy for Mitt Romney and Rick Perry to name a few of his former clients.

While I don't automatically agree with conservative solutions, I would remind people that Obamacare itself was based upon an idea hatched at the Conservative Heritage Foundation in a paper written by Stuart M. Butler and first published in 1992 (see a scanned copy of the original Heritage Foundation paper at for details). For the record, although Democrats implemented it, the Heritage Foundation now denies ever having created the idea, even though there is documented evidence that it did so. But its proof that conservative (not libertarian) plans can potentially work if entities with vested interests which they wish to protect are not actually authoring the proposed "solutions"  because they always tend to write-in things which will benefit them, which causes failure.

Anyway, Avik Roy's expertise is in healthcare policy. While there can be legitimate disagreement with him on his ideas for policy solutions, his assessment of the state of U.S. healthcare is usually rooted in fact, not fiction, and for that reason, I respect him. Where I occasionally disagree with him are his ideas for fixing what is wrong with healthcare in the U.S. (although I would mention that I don't always disagree with his ideas).

Still, not long ago, he Tweeted something I thought was worth sharing (actually, it was in 3 successive Tweets). To simplify, the full text is below, although a link to the thread of those Tweets can be found at

If a mobster says, "give me $100,000 or I'll kill your daughter," it doesn't matter that he's offering price transparency. He's still committing extortion.

I Tweet this because I'm hearing an increasing number of Republicans tout price transparency as the solution to all our health care problems. Transparency is necessary, but it's far from sufficient.

Tackling the problem of monopoly power is just as important, if not more so, relative to price transparency. Otherwise "price transparency" becomes the new GOP health care punt, replacing "buy health insurance across state lines."

Anyway, back to my Diabetes Health article in 2018. One of the takeaways mentioned as in the last paragraph of the article was as follows:

"My recommendation on insulin prices is to continue letting your Federal and State lawmakers know how big of a problem runaway prices on medicines including insulin are for you personally.  The more they hear about the issue, the more likely they are to address it. Persist and continue calling your elected officials regularly on the issue – it's not too much to write to them once per week on the subject until they do something."

I am very pleased to see that nearly two years later, we are starting to see signs of that recommendation in action. In the past month, we are starting to see an explosion of STATE legislation on insulin prices happening. Almost all of the action is currently taking place in state capitals around the country, plus it's happening in purple, red and blue states alike.

Let's look at what's going on with insulin pricing in a number of states nationwide:

On January 24, 2020, Illinois Governor J.B. Pritzker signed a law capping monthly insulin costs at $100 for people covered by state-regulated commercial health insurance plans in that state (see news "Illinois law caps insulin patient costs at $100 monthly" at for more). The Illinois legislation is the first of several proposals to actually become law.

On February 4, 2020, the Virginia House of Delegates passed a bill that would prohibit insurance companies from charging more than a $30 co-pay for a 30-day supply of insulin in the state, although it's not law yet. (see for more).

Similarly, on the same day as Virginia moved a bill forward on insulin prices, a bipartisan bill was introduced in the neighboring Tennessee House which would set a price cap on the cost patients pay for insulin at $100 for a 30-day supply (see for more).

On February 13, 2020, a bipartisan group of Connecticut lawmakers introduced legislation that would cap the monthly cost of insulin at $50. The bill would also limit the price of other insulin-related supplies, such as syringes, pumps and blood sugar meters, to $100 a month (see more at The Connecticut bill may not pass in its current form, since it introduces a tax on insulin levied on the insulin manufacturers which is seen as giving with one hand, and taking away with the other hand, even while the costs are usually always passed on to consumers in the end.

A Utah state lawmaker named Rep. Norman Thurston is reportedly also looking to make insulin more affordable for Utahns, by sponsoring a bill called HB 207,which would cap co-pays for insulin at $30 for a month's supply in Utah (see for more).

The Associated Press reported on April 7, 2020: Utah Governor Gary Herbert signed into law the aforementioned legislation capping monthly copayments for insulin at $30 for a 30-day supply. The law was approved by the full Utah legislature just a day earlier, and it also includes an emergency refill provision that will allow people without an up-to-date prescription to get insulin immediately rather than waiting until they are able to get a refill authorized by a physician, as well as a provision directing the Utah Department of Insurance to issue a report that includes a summary of insulin pricing practices. The new law takes effect on starting January 1, 2021.

New Mexico:
New Mexico lawmakers bill capping what New Mexicans with diabetes spend on life-saving insulin received final legislative approval with a 40-1 vote in the Senate. Like the state of Washington in the north, New Mexico shares an international border with the country of Mexico, and some citizens are crossing the boarder to buy less costly insulin in pharmacies along the border. New Mexico's bill would cap prices at $25 for a 30 day supply of insulin. New Mexico Governor Michelle Lujan Grisham has expressed her intention to sign such legislation into law once passed. She said the overwhelming bipartisan support this bill received in both chambers is a resounding testament to New Mexico's commitment to reducing health care costs. (see for details)

In Oregon, state Rep. Sheri Schouten (D) of Beaverton acknowledged to the local press that she is working on a bill called HB 4073 that would cap the out-of-pocket insulin expenses for privately-insured Oregonians at $100 for a 30-day supply. The bill is currently still in committee, and therefore may see changes before it goes to the Oregon legislature for a vote. (see for more detail).

Washington (state):
Separately, in the State of Washington, a Senator in the state legislature named Karen Keiser has introduced a bill called SB 6087, in which health plans issued or renewed in the State of Washington on or after January 1, 2021 must cap insulin co-payments, deductibles, and other forms of cost-sharing at $100 per 30-day supply. The bill also requires the state health care regulatory authority to monitor wholesale acquisition costs (list prices) of insulin products in Washington. (see for more). Since then, there has been news that Washington will also consider legislation to legally enable state residents to legally cross the state's northern border into British Columbia, Canada to buy prescription drugs such as insulin. Many state residents are already doing so, but the legislation would legalize the practice in Washington (see for details)

Kentucky is yet another state now looking to cap the prices patients are asked to pay for insulin. (see for more). The Kentucky bill only applies to cost sharing for insured people, but could do something similar to laws in Colorado and Illinois.

West Virginia:
We also recently saw the state of  West Virginia move to cap the cost of a 30-day supply of insulin at $25. The state House Judiciary Committee approved legislation being called HB 4543, sending the measure to the full chamber for consideration next. (see for more).

This is a rapidly-evolving space, but just since I posted this, additional states have put legislation to cap insulin prices in consideration, Ohio among them. There are also rumors that Maine will act very soon, too.

There are no fewer than five U.S. other states believed to be in various stages of pursuing legislation on insulin prices. What the bills look like and whether they become laws remains to be seen. So far, only Illinois has passed a law on it (in addition to Colorado and Nevada); other states do have bills being drafted. considered by various committees, and must still be voted on by their legislatures before being signed into law by state governors. But for the pharmaceutical industry, dealing with more than 50 state laws (including D.C. and Puerto Rico) is the worst of all possible outcomes.

In 2017, Lars Fruergaard Jørgensen, chief executive of Novo Nordisk A/S warned investors about state legislation on insulin prices, claiming they might be "difficult" for his company to do business in the U.S., which generates more than 60% of its profits even though the U.S. accounts for less than 40% of its customers. He told Reuters (see for the original article):

"Trump has repeated a number of times that he believes the industry gets away with murder, obviously we don't agree."

But at the state level, more and more legislation was being prepared to increase clarity around prices, he said.

"If the transparency bills lead to a disclosure level that is too excessive, it becomes difficult to do business, for instance, if we have to publicly share what is in our contracts," Jørgensen said.

But as I suggested in the concluding paragraph of my Diabetes Health article, state laws can have a direct impact on what you pay for diabetes supplies, including insulin, so I encourage you to contact your lawmakers (both Federal and state) and share your stories about runaway insulin prices and how you are impacted.

As we can see, legislation is percolating in state capitals across the U.S. More importantly, they are being proposed by both Republican and Democratic lawmakers, and like the Nevada law which was signed into law by a Republican governor, the odds of passage increase with bipartisan support.

So, while dysfunction and giving PhRMA everything it wants (which is to make NO change to the way things happen today) seems to be all lawmakers in Washington, D.C. can do, the states are definitely doing things on insulin prices.

We can expect more and more states across the country to make similar moves because the problem is basically being ignored in Washington, D.C. Although the House has passed legislation, it will likely never be voted on in the Senate. Indeed, McConnell told Politico: "Socialist price controls will do a lot of left-wing damage to the health care system. And of course we're not going to be calling up a bill like that."

A bipartisan Senate bill introduced by Senate Finance Chairman Chuck Grassley (R-IA) which would make changes to Medicare by adding an out-of-pocket maximum for beneficiaries and capping drug price increases at the rate of inflation, among other measures. Private insurance often follows what Medicare does in terms of policy matters.

Sen. Grassley has openly warned the Senate Majority Leader Mitch McConnell, who has been derisively nicknamed by many as "Moscow Mitch" McConnell, that his bi-partisan legislation which he co-authored with Sen. Ron Wyden (D-OR) is necessary to help Republicans keep control of the Senate in the 2020 elections. He also warned that if the Senate fails to act on prescription drug prices, that failure to act could harm the vulnerable Republicans who are running for re-election in 2020.

"There's a great deal of disgust with the rapidly increasing price of drugs, and every Republican up for election's going to have to have a place to land," Grassley told reporters in September 2019.

"And this is the place to land, because they're surely not going to land with what Pelosi's [doing]," he continued. "If McConnell wants to keep the Republican majority, then this drug pricing bill is part of that plan."

Yet when when he was asked by reporters during a briefing why more Senate Republicans had not supported his legislation, Sen. Grassley was very candid, saying it was because Sen. Majority Leader Mitch McConnell had "asked them not to".

Grassley and McConnell at Odds Over Insulin Prices

Sens. Grassley and McConnell have reportedly been at odds over the bipartisan measure, which actually has support from President Donald Trump and also many Senate Democrats.  The reasons are varied. He doesn't see it as particularly important, although voters may think otherwise.

Plus, we also know that from July 1 to Sept. 30, 2019, Mitch McConnell’s joint fundraising committee and campaign committee received contributions directly from several pharmaceutical industry PACs during the quarter 2019, including from the Biotechnology Innovation Organization ($1,000). That effort raised a total $195,300 from executives and PACs of pharmaceutical companies, according to third-quarter Federal Election Commission filings reviewed by Sludge. For example, we know that Sanofi contributed $15,600 directly to Mitch McConnell's joint fundraising committee in the third quarter 2019, while Novo Nordisk Executive Vice President Doug Langa personally donated $10,000 to Mitch McConnell's Senate committee. In addition, a total of $63,000 from pharmaceutical interests, all from individuals affiliated directly with Eli Lilly & Co. (meaning they were likely made by donors employed by Lilly) were reported

"Big Pharma has outsize influence in D.C., and as a direct result of the rigged drug pricing system manufactured by this influence, patients across America are rationing medication, going without food, going bankrupt and dying because they can’t afford prescription drugs," Juliana Keeping, communications director at Patients for Affordable Drugs, told Sludge. "That's why we're urging lawmakers on both sides of the aisle to pass reforms with the sense of urgency patients deserve."

On February 14, 2020, Sen. Grassley told Politico (see for more) that he had made some changes to his drug plan, S 2543 (116), in a bid to win over more Senate Republicans — but he says he wouldn't reveal the tweaks until a CBO score of the revised bill was ready, most likely in a few weeks. He told reporters that he believes it will require 25 Republican co-sponsors of his bill in order to persuade Senate Majority Leader Mitch McConnell comfortable with even bringing up the plan. But he added that's on him, not McConnell.

"[McConnell's] got some legitimate concerns about divisions within the [Republican] caucus. As I told him before Christmas, it's my job to take care of those concerns. We're in the process of it by working one-on-one to get more co-sponsors," Grassley said. He added that he's keeping the details very close-to-the-vest over concerns the media might distort whatever he says and make his sales job more difficult. Sen. Grassley wouldn't say exactly how many co-sponsors he already has, although 11 Republicans endorsed his bill either when it first came up in the Finance panel or via public statements. He crafted the bi-partisan plan with Finance ranking member Ron Wyden (D-OR).

In the meantime, Mitch McConnell himself is now facing a very well-financed Senate challenger in 2020, something he has seldom faced in past re-elections. This year, he's being challenged by Democrat Amy McGrath who is running a very well-capitalized and well-organized campaign for the role of Senator representing Kentucky, and polls put the former Marine pilot nearly equal to McConnell in terms of expressed voter intent as we head into the 2020 election. She has personally visited nearly every tiny town in Kentucky to share her message, something McConnell has not done and likely will not be doing. That means McConnell is relying on expensive television advertising, much of it paid for by dark-money SuperPAC's partially-funded by donations from the pharmaceutical industry.

Big Insulin Bankrolls Mitch McConnell to Ensure Nothing Happens

For example, from July 1 to Sept. 30, 2019, Mitch McConnell’s joint fundraising committee and campaign committee received contributions directly from several pharmaceutical industry PACs during the quarter 2019, including from the Biotechnology Innovation Organization ($1,000). That effort also raised a total $195,300 from executives and PACs of pharmaceutical companies, according to third-quarter Federal Election Commission filings reviewed by Sludge.

We know that Sanofi contributed $15,600 directly to Mitch McConnell's joint fundraising committee in the third quarter 2019, while Novo Nordisk Executive Vice President Doug Langa personally chipped in $10,000 to McConnell's Senate committee.

"Big Pharma has outsize influence in D.C., and as a direct result of the rigged drug pricing system manufactured by this influence, patients across America are rationing medication, going without food, going bankrupt and dying because they can’t afford prescription drugs," Juliana Keeping, communications director at Patients for Affordable Drugs, told Sludge. "That's why we're urging lawmakers on both sides of the aisle to pass reforms with the sense of urgency patients deserve."

As might be expected, McConnell is completely dismissive of his challenger. But Amy McGrath has touted many of the same issues — health care and good-paying jobs — that now-Governor Andy Beshear highlighted in ousting Republican incumbent Matt Bevin in last year's election for governor.

"Kentuckians know that his job is more than just bringing a check to Kentucky," she said. "Where is his leadership on saving health care? Where is he at with the rising cost of prescription drugs? Why hasn't he done anything to stop the trade war that's hurting farmers and businesses in Kentucky? Where's he at with raising the minimum wage? It's nice that he's getting money for Kentucky, but the rest of the job is so important," she added. "And it's actually bigger and broader and he's failing at all of these other things."

On runaway insulin prices, as Kentucky Rep. Steve Sheldon (R) Bowling Green put it: "As far as the answer to who's going to absorb this [cost], these insulin prices are so inflated, there's so many people with their hands in the cookie jar."

Tuesday, September 17, 2019

In 2020, People With Diabetes May Wish to Thank the IRS

Amidst news of several Congressional hearings on the topic earlier in 2019, and continued protests by patient advocates outside of insulin manufacturers' headquarters, as well as persistent patient and caregiver complaints about runaway U.S. insulin prices in the U.S. media, a less-acknowledged change occurred which could impact what many patients with diabetes pay next year for insulin and testing supplies.

It's not often that Americans would actually wish to THANK the Treasury Department and the Internal Revenue Service (IRS), but in 2020, perhaps many Americans with diabetes might wish to do that!

On July 17, 2019, the IRS added care for a number of chronic medical conditions to the list of preventive care benefits that may be provided by high deductible health plans (HDHP). The press release for that change can be seen at Details are outlined in Notice 2019-45 (see for the complete list) lists a number of new types of medical care that are now allowed under IRS rules to be treated as "preventive care" for this purpose. There are important tax implications for healthcare insurance companies for offering these benefits.

The IRS defines a high deductible healthcare plan (HDHP) as healthcare plans which generally do not provide any benefits for any year until the minimum deductible for that year has been satisfied. Currently, the IRS defines a high deductible healthcare plan as one having a deductible of at least $1,350 for an individual or at least $2,700 for a family. However, under IRS rules, a HDHP is not required to have a deductible met for defined "preventive care" services. The tax implication is that healthcare insurance companies may classify the expenses associated with those services as business expenses on their tax returns. But that list has historically been fairly limited. The IRS applies the same general rules to Healthcare Savings Accounts (HSA).

But after all of the Congressional hearings this year, the U.S. Treasury Department and the IRS determined that certain medical care services received and items purchased, including prescription drugs and a few medical devices for certain chronic conditions should therefore now be re-classified as "preventive care" for people living with chronic conditions. Diabetes (all types), asthma and depression were among the major chronic conditions which were recently added to this list. This means that insulin to treat both Type 1 and Type 2 diabetes as well as other drugs to treat Type 2 diabetes (Symlin is the one FDA-approved non-insulin med to treat Type 1 diabetes which is also eligible), plus testing supplies and HbA1c testing should all be covered under these new IRS rules. All told, the new rule has outlined 14 medications and services that now qualify for pre-deductible coverage, several of which apply to people with Type 1, Type 2 and people with known diabetes complications. Among them:

  • Insulin and other medicines to lower blood glucose
  • Retinopathy screening
  • Glucometer
  • Hemoglobin A1c testing
  • Statins for diabetes (previously on the preventative treatment list, but only for cardiovascular disease)

This is a very major development, and it is one which I suggested as something that needed to be adopted back in November 2018 (see my post HERE) might alleviate much of the financial difficulty people with diabetes have faced in affording such very basic treatments as insulin in recent years. This was also one of the suggestions revealed in the Congressional testimony in early 2019. I am very pleased they have finally adopted this.

As noted, because there are important tax implications for insurance companies, most insurance companies willingly cover these preventative treatments. However, the implementation of them will take place based on differing "plan dates" unique to every employer's health plan, so beware it may not happen immediately. I am guessing it will likely apply to everyone starting in 2020 based upon the implementation dates.

It is somewhat curious that on April 3, 2019, health insurance company Cigna (the owner of the PBM Express Scripts) made news with a Patient Assurance Program (see the press release HERE), which it said would ensure eligible people with diabetes in participating Cigna plans would pay no more than $25 for a 30-day supply of insulin. However, Cigna was not telling everyone that it applied only to new employer contracts the company landed in 2019 and later (meaning no existing contracts would get the benefit). But more importantly, if Cigna adopts the new Preventative Care guidelines under the IRS rules, Cigna's Patient Assurance Program will be irrelevant, plus thanks to the change at the IRS, Cigna may actually be getting U.S. taxpayer subsidies to offer that.

I personally called my own insurance company to ask when MY healthcare plan would be adopting the new IRS guidelines. Initially, they were unable to answer my question. But I later learned that the company is in the process of implementing the new preventive care benefits, although they were not yet in place. But this means they will very likely be in place starting next year.

For the Uninsured: Consider 340B Prescription Drug Program

The new IRS rule change will NOT solve Rx access problems for everyone (the uninsured, for example), but for millions, it certainly will. For those outside of the HDHP employer coverage issue, there are still programs which can assist, and I'm not talking about the manufacturers' bogus patient assistance programs -- I've yet to meet anyone who qualifies for those. But suppose you're a person who just turned age 26 and are suddenly no longer eligible to be covered under your parents' health insurance. Maybe you're working various "gig" jobs with no benefits and maybe also waiting tables or working at your local coffee shop as a barista to make ends meet, then it might seem like things look pretty dire as far as diabetes is concerned. These are exactly the types whom the 340B Prescription Drug Benefit are supposed to benefit. But most people aren't even aware this program even exists, let alone know how it works.

Without getting too wonky about exactly how this program works (I'm not certain I could do so even if I wanted to!), just know that this program costs taxpayers next to nothing. But in exchange for access to a massive Medicaid market, the government requires drug companies make prescription drugs be sold under this program at about 50% off list prices. You need not be at or near poverty-level in order to qualify. You simply need to establish a relationship with a doctor at a participating Community Health Center.

To find an eligible Community Health Center, visit Be advised many Community Health Centers are not in the greatest part of town; some are located in schools. They are intended to serve disadvantaged communities, although they are open to all. But once a patient does visit one, thereby establishing a doctor-patient relationship there, they then become eligible to buy their prescriptions from the Community Health Center's pharmacy. You do not even have to stop seeing your regular endocrinologist, you just need to also establish a doctor-patient relationship with a doctor at a participating Community Health Center. Most will understand the acute need for access to affordable insulin. You might even like the doctor, too!

Most (but not all) of these Community Health Centers contract their pharmacy operations out to third-party pharmacies, which means you'd receive a pharmacy discount card which can be used at a designated pharmacy (usually a Walgreens pharmacy, which is the biggest 340B pharmacy, but only at one specific Walgreens location nearest to the Community Health Center). The rules of this program are not widely known or understood, but it's a very good program for people in need, and provides deeply-discounted prescriptions on things like insulin. More info. about the 340B drug program can be found at Now, I should acknowledge that technically, the law only applies to in-clinic treatments, but they have always made exceptions for certain ailments like diabetes and asthma since those require patients to self-medicate. Just beware some critics may indicate otherwise; but a doctor at these facilities can explain how it works for their center.

Once you become a patient of a doctor at one of those Community Health Centers, you become eligible to buy prescription drugs from their pharmacies. The program was created in 1992 as part of the Veterans Health Care Act, the 340B drug pricing program requires drug companies to provide discounts — sometimes as much as 50% — to covered entities, hospitals, and clinics that treat low-income and uninsured patients. And those Community Health Centers will see any and all patients in their community—regardless of their incomes (or lack thereof). I do, however, recommend when registering at a Community Health Center for the first time to not provide any insurance info. even if you have it. Tell them you will be paying for services out-of-pocket.

But for these people, programs such as the 340B Drug Discount Program under Medicaid are ones the uninsured individuals can more easily qualify for simply by seeing a doctor in an eligible "Community Health Center". I am not at all experienced with this, but I know many people (even those who are otherwise ineligible for Medicaid) can legally qualify under this program. But you must take steps to ensure you become eligible including visiting a doctor at an eligible Community Health Center, perhaps several times each year (you can ask the doctor you see at the center).

Some big hospitals are trying to cheat the 340B drug program, hence PhRMA wants to punish them. But uninsured patients are exactly the kind of people this program is supposed to help.

Tuesday, April 09, 2019

My Trial With Sanofi's Admelog, The Biosimilar Version of Humalog

A while back I blogged about the emergence of biosimilar insulin in the U.S., more than a decade after I studied the topic and discovered some troubling reasons none existed. Since then, in spite of top officials at the U.S. Department of Health and Human Services advocating for a more robust biosimilars market in the U.S., we have seen fewer rather than more, so that's not working out so well for the Trump Administration's promise to bring drug prices way down so far. In late 2018, Merck quietly pulled the plug on its own Lantus biosimilar which was to be branded as Lusduna Nexvue (see more HERE for details). Merck tried to keep its plan to dump its Lantus biosimilar on the down-low, but news emerged from a South Korean securities filing (akin to the U.S. SEC) when co-development partner Samsung Bioepis disclosed the fact that Merck was paying it a termination fee in its filings with Korean regulators.

Anyway, I've been using the Humalog biosimilar branded as Admelog (U-100 insulin lispro rDNA origin) made by Sanofi for the past few weeks. I use vials and syringes since is the least costly way of buying insulin these days. The reason is purely economic: while still paying towards my insurance deductible, I have the option of paying more than $230 for a single vial of Humalog insulin, or I can pay just $99 for the same insulin with a coupon from Sanofi. Insulin pens cost even more than vials do, and you get less insulin in five pens than you do in a single vial of the same insulin (plus syringes are cheap). Several years ago, Maria J. Redondo, MD, PhD, MPH, and assistant professor of pediatrics at Baylor College of Medicine in Houston said "Pens are more expensive than vial and syringe, and different insurance companies cover different pens depending on the formulary."

But I had almost no reservations about switching from Lilly to a Sanofi-made insulin.

Guess what?

Based upon my personal experience, I believe Admelog really IS the same insulin as Humalog, although it does have some hang-time which I attribute to the preservatives used.

When I say that, I mean that I didn't have to make any dosage adjustments (insulin-to-carb ratios or for correction dosages) using Admelog vs. Humalog, so I would call that the same. By comparison, I always had major adjustments that needed to switch (involuntarily) to/from Novo Nordisk's Novolog (U-100 insulin aspart rDNA origin), or when switching to/from Sanofi's own Apidra (U-100 insulin glulisine rDNA origin). Every ratio had to be adjusted for each brand switch. Of course, when insurance makes these changes, they do not give patients any additional test strips needed for the adjustment -- they're on their own, because the formulary manager decided that Humalog, Novolog and Apidra are all "therapeutically equivalent" medicines. Such non-medical switching has become increasingly common over time. For the most part, my experience has been switching between Humalog and Novolog (less so with Apidra, although back in the early 2000's, I did use that, too -- although I think it may have been when insurance actually provided a choice of rapid-acting insulin analogues, each priced at different tiers of the insurance company drug formulary; also now history).

Personally, I don't entirely understand why the Sanofi discount coupon for its insulin varieties is even necessary, except the normal CVS retail price for Sanofi Admelog is an absolutely stunning $481/vial! Indeed, for a biosimilar, the marked down price reportedly being offered to pharmacists is pretty tiny (roughly 15%-20%) when compared to the brand name. Most other generic drugs see discounts magnitudes higher, in the range of 25% to 60% off the brand-name drug's price. In fact, Lilly's own "authorized" generic which will be called Lilly Insulin Lispro (U-100 insulin lispro rDNA origin) will reportedly be LESS expensive than Sanofi's copy of the same insulin, priced at $137.35/vial (see the Lilly press release about its "authorized generic" of Humalog at for more information).

Lilly's move on insulin prices mirrors what was done a few years ago when the entire EpiPen issue exploded due to runaway prices. Mylan effectively calmed its EpiPen PR crisis by introducing a cheaper authorized generic. Now Lilly, following the very same playook, and is hoping for a similar result.

The mere fact that Lilly was able to introduce a "half-price" version with virtually no impact to the company's bottom line says a LOT about the the shenanigans going on behind the scenes. According to CVS, the authorized generic version of Lilly Insulin Lispro is still not available in stores, but a call to Lilly's patient assistance telephone line did reveal that the company expects it to be available at pharmacies nationwide "sometime in the second quarter of 2019", meaning between April and June 2019.

Estimated Manufacturing Cost for one vial of any insulin in 2018: $6 to $8

All of this is utterly insane because a submission to the Journal of the American Medical Association (JAMA) not long ago reportedly estimated the actual cost to manufacture a single vial of any insulin variety to be around $6 to $8 dollars per vial! Compared to many other biotechnology medicines, insulin is pretty simple. Insulin already chemically very well-characterized (most biotech drugs cannot be characterized; insulin can) and it is a non-glycosolated biotech drug (I won't attempt to explain it, just see HERE for more if you're interested); so in many ways, it should be a hell of a lot cheaper than more complex biotech medicines which are not well-characterized and have very complex protein structures. To make most other biotech medicines means maintainence of very tight control over their manufacturing process is somewhat more important than it is with insulin because things can easily go wrong.

The reason insulin is not cheaper is mainly because of secret discounts given to formulary managers at insurance companies, many of which are passed on directly to employers who buy the insurance plans, and the Rx rebate money is used as an offset for high healthcare insurance premiums. If the employer isn't as good of a negotiator, then the insurance company-owned pharmacy benefits manager (PBM) simply keeps the rebate money for itself. And, big employers no longer have such a huge advantage over small employers as was once the case. That's because in recent years, small employers have largely banded together by using so-called Professional Employer Organizations (PEO's) to handle insurance and dental benefits, payroll, unemployment claims, etc. That means that today, the largest U.S. PEO is ADP TotalSource, which as of 2018 reportedly "co-employs more than half a million worksite employees" (see the press release for details). That makes them bigger than both Kroger and Home Depot, dwarfed only by Walmart and marginally by Amazon (if you're interested, see the Wikipedia listing for "List of largest United States-based employers" at for more detail).

Sanofi Doesn't Appear to Be Working Very Hard to Sell Admelog

The thing is that Sanofi is NOT making it easy for any patient to use their follow-on or biosimilar insulin lispro product, which is a mystery to me. For one thing, the clerk at CVS asked me what my insurance was, and I told her I would not be using insurance to pay for this insulin because I had a choice of paying either $238/vial if its submitted to insurance, or $99/vial if I pay without insurance. One need not be a mathematician to understand that the amount of cash I'll be paying is still nearly 2/3 cheaper ($99/vial vs. $238/vial), even if it doesn't contribute a penny towards my deductible. But it requires Sanofi's coupon to get that price.

Can Medicare Patients Get Admelog at a Discounted Price?

There is also a very strange thing going on with Medicare, with companies trying to charge Medicare patients full price and making their coupons un-available to Medicare patients. On Sanofi's cheekily-named "val-YOU" website where they give insulin coupons to patients (see for the details), the company has a five question "screener" survey to ensure patient "eligibility" for the insulin discount coupon, including asking if "do you currently receive Medicaid?" and "are you currently serving in the U.S. military?" and "do you qualify for Medicare?" ... if someone answers "YES" to any of these three questions (Questions 3, 4 or 5), then Sanofi responds by telling the individual they cannot give you a $99 discount coupon for its insulin. But if the patient answers those three questions "NO", then voila, they get the discount coupon.

Guess what? That's basically bull$#!t.

There is no prohibition that any patient must submit any claim for prescription medications to insurance (or in their case, to Medicaid, Medicare or the VA). Indeed, we have seen examples where many patients discovered the lower-cost generics list offered by different pharmacy retailers are actually much cheaper than what they might otherwise be charged if the script was processed through Medicare Part D.

The Sanofi offer terms say: "This offer is not valid for prescriptions covered by or submitted for reimbursement under Medicaid, Medicare, VA, DOD, TRICARE, or similar federal or state programs, including any state pharmaceutical assistance programs." But if one does not submit the claim through any of those programs, then they are essentially paying for the insulin out-of-pocket and they are theoretically eligible for the discount offer. There is no law requiring anyone to submit a prescription drug claim to insurance or through Medicare or Medicaid.

What Sanofi conveniently omits is that they actually all WANT all Medicare/Medicaid patients to pay through those particular insurance programs because under a sweetheart deal for pharma, Medicare is not able to negotiate any volume-based discounts for prescriptions. But it frequently ends up costing the patients dearly. Its similar to the pharmacist "gag-orders" which Congress only recently banned (see the Kaiser Health News article at for more background on that).

Let me say this: there is no law preventing ANYONE (covered by insurance, Medicare or any other plan) from paying for prescriptions out-of-pocket. That's a personal decision. Usually, its to the patient's benefit to go through insurance or Medicare/Medicaid, but not ALWAYS, and exactly when can be a decision with genuine financial impact.

I'm certainly not advocating fraud, but any patient is always free to pay for any prescription out-of-pocket, which also means that any manufacturer discount coupons offered for cash payers can be given to anyone who pays for a prescription out-of-pocket. I don't see that as remotely un-ethical. What IS unethical is the kind of games that go on with pharmaceutical companies operating in the U.S.

Something else many seniors with Type 1 diabetes discover: if you are a senior on Medicare and use an insulin pump, Medicare will pay for the insulin to effectively "power" your insulin pump as part of Medicare Part B, not Part D. They may make those patients jump through some hoops to get an insulin pump covered (once upon a time, Medicare would only cover patients with Type 1 diabetes, not Type 2 patients who use insulin due to the cost; I don't know if that is still the policy, but I mention it as one of the questions that need to be asked).

I'm not even eligible for Medicare for at least another 15 years, and who knows what that might look like at that time. But the issue of how American patients with diabetes are forced to navigate a thicket of odd rules and secret, back-room discounts paid to various parties in the distribution system for prescription drugs is not about healthcare, its about someone making money. Dr. Elisabeth Rosenthal, M.D. wrote in a coherent opinion piece published in the New York Times (a company she once worked for), "Why Should Americans Be Grateful for $137 Insulin? Germans Get It for $55" (she also adds that Germans get it for $45 if they buy five vials at a time, see the full piece at for details) suggests that while Americans are relieved at anything that lowers prices, we are still overpaying relative to the rest of the world. As noted, brand-name Lilly Humalog (U-100 insulin lispro rDNA origin) sells for $55/vial in Germany. And in France. And in Sweden. And in Denmark. And across the rest of the world.

When seniors need to fill prescriptions, they are told they are suddenly in-eligible for discount programs offered to everyone else, but again, its not entirely factual. Its the story the pharmaceutical industry WANTS them to believe.

Freedom Caucus Effort to Derail Congressional Efforts on Runaway Insulin Prices

Much more needs to be done to rein-in runaway prescription drug prices in the U.S. and there does seem to be bipartisan desire to address the matter (although it is worth acknowledging that Reps. Jim Jordan, Mark Meadows and several other Republicans who are part of the House Freedom Caucus who happen to be on the House Oversight Committee sent letters to a dozen CEO's of major drug companies warning them that information they might provide to the House investigation into drug pricing could be leaked to the public by Democratic chair Rep. Elijah Cummings in an effort to tank their stock prices. Their letter can be viewed at although several media outlets have since addressed that highly unusual and counterproductive move, including BuzzFeed news which broke the story and the snarky Wonkette offered its own spin on what they believe is going on. Suffice to say, this is a highly-unusual move for a minority party in Congress to try and doom any efforts the majority party is pursuing on behalf of the American people, but this is how Republicans now operate.

Monday, November 19, 2018

We Need Get Insulin Added to the National "Preventive Medication Coverage" List

For 2018 World Diabetes Day (which is on November 14 of each year, the date of discoverer Frederick Banting's birth), I avoided much "celebration" or even acknowledgement. Its not that I don't care -- indeed, I can remember my involvement of working to get Congressional recognition of the day and helping to persuade the then-UN representative with written letters to that the United States' citizens actually supported the day's (and month's) creation way back in the early 1990's. Prior to that, diabetes wasn't even acknowledged outside of the medical profession.

That said, in many ways, I hate these honorary "days" or "months" because they really marginalize all of the other days and months that we must go on without so much as an acknowledgement, and frankly, there are some huge problems with diabetes treatment in the United States, perhaps more so than elsewhere in the world.

One of the most disgusting developments in recent years has been the runaway prices for insulin, which if I'm being frank, are simply greed-driven price hikes for decades-old drugs whose development costs were recuperated years ago. Years ago, I addressed biosimilars and the bogus reasons they hadn't emerged (see my coverage at but today, the distribution and payment hierarchy have added vastly to the prices people with diabetes pay for insulin.

Without getting too wonky, the main issue that gets insufficient attention is the runaway prices for all of what's needed to treat this chronic disease that have skyrocketed and have shown no signs of deflation. In particular, insulin prices have increased about 1200% (that's one thousand two hundred per cent) over the past decade. The pharmaceutical industry has convinced itself that list prices for drugs are irrelevant, which is a falsehood. Artificially-high list prices for insulin, combined with nearly as high rebates paid to third-party drug wholesalers, Pharmacy Benefits Managers (PBM's), healthcare insurance companies and retail drugstores all add to the not-at-all transparent pricing structure that masquerades a hugely inefficient pharmaceutical distribution system where every party benefits from higher prices EXCEPT patients. Needless to say, because of that, the drug industry and and related parties including the healthcare insurance industry have worked tirelessly to preserve the expensive status quo.

Congressional caucuses are largely irrelevant, officially they are a group of members of the U.S. Congress from both the Democratic and Republican parties that meet to pursue common legislative objectives. Formally, caucuses are formed as Congressional Member Organizations (CMO's) through the U.S. House of Representatives and governed under the rules of that particular chamber. Typically, its just another title lawmakers give themselves because they seldom accomplish much and frequently, the caucus members own voting records work against the very objectives they claim to support. That said, occasionally, they do something, and their research has potential to yield meaningful results if the caucus acts on their findings. Quite recently, the Congressional Diabetes Caucus actually released a relevant report about insulin pricing which meets the definition of "runaway" price increases.

In June 2017, Representatives Diana DeGette (D-CO) and Congressman Tom Reed (R-NY) who are the co-chairs of the caucus, sent letters requesting meetings from 3 key stakeholders: the Pharmaceutical Research and Manufacturers of America (PhRMA), the Pharmaceutical Care Management Association and America's Health Insurance Plans. These are the major trade groups for the pharmaceutical industry, the pharmacy benefit managers and the health insurance industry, respectively. After meeting with officials from these three organizations, the members released key findings summarizing what was discussed in these meetings and a separate, additional meeting with the American Diabetes Association. The caucus reports that average insulin prices have doubled since 2012, and many patients are also facing high prices due to high deductibles (prevalence of deductible insurance plans have increased steadily and now represent more than half of all plans), coinsurance and formulary exclusions.

More details on the caucus' research can be found on chairwoman DeGette's web page at with the actual report found at

DiabetesMine first addressed my idea at and its worth re-visiting.  The Diabetes Patient Advocacy Coalition (DPAC) has coverage of the report at while T1D Exchange (the folks who run Glu have also chimed in on the topic although they have addressed thoughts on pricing more generally not the diabetes caucus reporting, and of course, so have the ADA and JDRF among the big diabetes nonprofit organizations that take credit, in reality, its the complaints and voices of people with diabetes that brought the latter two organizations to even acknowledge the problem.

Revealed in that report were an acknowledgement of the physical path that moves the insulin from manufacturers to pharmacies (and, in-turn, patients), and the subsequent flow of insulin payments. Because so many parties are involved in both, efforts to address upward price pressures, the report suggests doing more to encourage more insulin biosimilars (so far, ALL biosimilars are coming from Big 3 insulin suppliers although the partnership of Mylan/Biocon have a Lantus biosimilar to be branded as Semglee pending FDA re-review as well as legal settlement with Sanofi), hence discounts have been modest at best -- reportedly only 15% off, compared to discounts of 75% to 80% for most small molecule drugs, to which big pharma responds that insulin is so much more complicated than small molecule drugs therefore the discounts are smaller, which is an outright falsehood). The report also recommends formulary changes that standardize the process for requesting exemptions or filing appeals from formulary changes, and that Congress could convene working groups composed of patients, providers, PBM's, and health insurers to develop a patient-centric appeals system. In addition, it recommends standardizing drug formulary disclosure of patient cost-sharing information, and potentially introducing legislation directing CMS to develop a series of standard formulary designs that provide cost-sharing information in an accessible manner, plus limiting the number of changes an insurer is permitted to make to a formulary each year, and finally capping out-of-pocket expenses for prescription drugs that are needed for chronic conditions.

First, note that most of these recommendations impact Medicare (and to a lesser extent, Medicaid), so they will not have material impact on private healthcare insurance which impacts most people.

A Practical Step Big 3 Insulin Makers Can and Should Be Doing Now, But They Aren't Doing

The elephant in the room is something Congress COULD do it if they were so inclined, specifically to make sure that all insulin varieties are added to the CDC's and CMS/Medicare list to the national "Preventive Medication Coverage" list which is a list of so-called preventive medicines and services without charging you a copayment or coinsurance, which is true even if you haven't met your yearly deductible. Virtually all private healthcare insurances cover these items already, except for short-term insurance plans which are considered junky insurance plans that Obamacare did away with anyway. It would be a fairly straightforward matter to get insulin added to this list, yet Congress never bothered to do so because they never saw insulin as preventative. In fact, several of the medicines on that list (such as statins) have never been proven to prevent cardiovascular events such as heart attacks or strokes, so they are no more "preventative" than insulin.

Now, if the Big 3 insulin makers were truly so concerned, they would have lobbied long ago to get insulin added to this list, but guess what? They didn't bother. I think its very clear what needs to be done: to get all forms of insulin (not just the old ones like regular and NPH) added to the national "Preventive Medication Coverage" list, making it either lower-cost or even one of the $0 co-pays on the insurance plan and doing so would be a fairly straightforward matter to do, but it needs to be uniformly supported by but most parties, and so far, big pharma as fought it at every step of the way. One has to ask why they are fighting this, but their answers for fighting it are more as a matter of principle, rather than having a very good reason for doing so.

The short-term solution, I propose, is to make sure that insulin is added to the national "Preventive Medication Coverage" list. That would likely impact everyone on Medicare (and Medicaid), as well as many private healthcare insurance plans quite quickly.

Now, can we get everyone on the same page, please?!

Friday, April 20, 2018

A Decade+ Later, Biosimilar Insulin Is Here

More than a decade ago (the article I published on my blog was originally posted on January 8, 2007 although I began research into the subject the preceding summer, see the article at for more background), I asked a number of very legitimate questions (some of which were later answered, others were not), with the most notable one being about why so many other diabetes medicines had "generics" but insulin did not (in spite of the fact that its patents had expired years ago).  Unfortunately, in my research, I discovered the some of the sordid inner-dysfunction of the U.S. pharmaceutical market, and now, 11 years later, the pharmaceutical industry still behaves as if it was business as usual, making few (if any) fundamental changes, and some downright sleazy operating practices to try and turn a century-old product into a cash cow (although truth be told, the NET margins for insulin have barely increased over time, but list prices have risen by over 1,000% over the past decade alone).  Catch my recent post on the recent price hikes at for a visual -- its simultaneously stunning and sickening.

Patents for recombinant DNA (rDNA) biosynthetic human insulin expired years ago, yet no money-savings generic insulin varieties EVER came to market -- and that's still true even today.  Initially, the drug industry tried to blame others for runaway prices (that has become a recurring pattern with the pharmaceutical industry; it's never big pharma's fault, and the industry ALWAYS blames others for the industry's own failures), claiming that Federal lawmakers failed to pass legislation governing generic biopharmaceuticals (also known as biosimilars and follow-on biopharmaceuticals).

The problems were that:

a) because insulin made via recombinant DNA technology was the very first-ever biotechnology medicine, insulin is grandfathered -- and governed as -- a "small-molecule" drug like aspirin, even while it was made using biotechnology, so that was just an unfounded excuse NOT to bring cheaper versions to market and
b) once Congress finally DID pass legislation to regulate copies of biopharmaceuticals as a provision of the Affordable Care Act (also known as the ACA or Obamacare) in 2010, the drug industry then worked overtime to prevent all generic (biosimilar) competition from ever coming to market with a barrage of frivolous lawsuits over patents, processes, weights and measures, packages, delivery devices, trademarks, etc.

In the end, most of the lawsuits failed, but the industry succeeded in delaying (but not preventing) biosimilar competition from coming to market.  This is a standard industry practice, and the costs are already factored into business plans.  Every delay means millions in pharma profits, so its an established industry practice and most every company in the pharmaceutical industry knows how the game is played very well.

Without getting into the lengthy history of insulin over the last 50 years, lets just say that after more than a decade, biosimilar insulin varieties have FINALLY hit the U.S. market.  This could (not assuredly) bring some relief to people with diabetes in the United States, although the rebate wall that keeps prices artificially high remains firmly in place.  On the latter issue, there have been recent promises from UnitedHealthcare to share some of the rebates with patients (see for the news) and Aetna will do the same (see for more), yet still other big insurers including Anthem and Cigna have not yet moved in the same direction.  However, Cigna is in the process of acquiring pharmacy benefits manager (PBM) Express Scripts (see for the news on that), whereas Anthem is in the process of starting its own PBM which will start operations next year (see for the announcement).  Anthem's move prompted the sale of Express Scripts given that its business prospects were shrinking.  Its possible when the dust has settled and the PBM business as we know it has disappeared by being folded into big insurance, we could see some meaningful change on that front, although its far from certain.

Basaglar, First Insulin Biosimilar (of Sanofi's Lantus) Made by Lilly and Boehringer Ingelheim

But the bestselling insulin on the market known as Lantus (U-100 insulin glargine rDNA origin) made by Sanofi would lose its patent exclusivity in 2015, so rival Eli Lilly & Company, Inc. and its partner Boehringer Ingelheim announced they would start selling a biosimilar branded as Basaglar (which is just another version of U-100 insulin glargine rDNA origin).  Note that I use these terms biosimilar and follow-on biologic interchangeably in this post.  News of Lilly's (and Boehringer Ingelheim's) plans to introduce a Lantus biosimilar emerged in 2014 (it was not a secret, the filings for FDA approval made them known to the industry via its infamous Orange Book, and the FDA tentatively approved Basaglar in August 2014).

Predictably, Sanofi filed a lawsuit (see for the news) accusing Lilly of infringing on seven patents related to insulin and devices used to deliver it.  Just over a year later, on September 28, 2015, there was news that Sanofi had settled its lawsuit against Lilly pertaining to Basaglar (see for the press release).  In my opinion, the lawsuit against was settled pretty quickly because Sanofi was suing a company that knew the insulin business better than almost anyone.  In the end, a settlement of the terms Sanofi wanted and Lilly was willing to pay was the most cost-effective manner to avoid a costly trial in which a judge and/or jury would decide the outcome.

Lusduna Nexvue and Semglee are Other Lantus Biosimilars Pending Introduction Soon

Lilly/Boehringer Ingelheim are not alone in pursuit of Lantus biosimilars.  Two other companies are also seeking to introduce Lantus biosimilars, including one from Merck & Co., Inc. and co-development partner South Korea-based Samsung Bioepis which received tentative FDA approval for another copy of U-100 insulin glargine on July 20, 2017 (see the press release at for more) which will be branded Lusduna Nexvue.

Not surpisingly, on October 24, 2017, Sanofi also sued Merck (and Samsung) over Lusdana Nexvue.  The lawsuit isn't identical to the one levied against Basaglar, Sanofi filed a patent infringement suit against Merck/Samsung in the U.S. District Court for the District of New Jersey alleging infringement on 18 patents in its suit related to Lantus (insulin glargine) and the SoloStar pens, so while Sanofi claims that more patents are being infringed upon in this case (mainly for the insulin pens; Lilly has KwikPens that are exempt from Sanofi's patent claims on SoloStar since Lilly's KwikPens are already on the market).

A third Lantus copy from Mylan Pharmaceuticals and co-development partner India-based Biocon to be branded Semglee is also pending introduction after a settlement or court ruling on similar lawsuits filed by Sanofi.  On June 17, 2017, the two co-development partners presented data on their U-100 insulin glargine product from the INSTRIDE studies at the American Diabetes Association's 77th Scientific Sessions in San Diego.  It's worth noting that the Sanofi lawsuits trigger an automatic 30-month stay under the Hatch-Waxman Act which governs insulin, and the litigation could still go to court, although it's unclear whether either will go that far.

Impressive Sales Growth of Basaglar Thus Far

So far, we already saw pretty impressive sales growth last year for Lilly's Basaglar, and that was while it was still new and not sold in all markets.  Sales of Basaglar quintupled in 2017 to $423 million (admittedly, from a low base of $86 million in 2016).  In Q4 2017, revenue more than tripled year-over-year to $154 million, from a very low base of $40 million in Q4 2016. Sequential growth was not quite as positive, with sales rising just 6% from $146 million in Q3 2017, but its still fairly early in the introduction cycle.  The transcript of that call can be viewed at for complete details.

That said, Basaglar already has pretty strong formulary coverage in the U.S. (Lilly has been aggressive in trying to reclaim formulary coverage it lost to Novo Nordisk over the years under Mr. Conterno's leadership), Basaglar is now preferred over Sanofi's Lantus on the CVS Caremark and UnitedHealthcare OptumRx formularies), although Basaglar will face pricing pressure on its insulin franchise in the U.S., particularly as more competing options become available for payers.  It's also worth noting that Lilly is also aggressively pursuing Medicare Part D sales to help offset high rebating in the commercial healthcare insurance channel.  Mr. Conterno cited "increased utilization in Medicare Part D starting January 1" adding, "by the way, we've seen excellent [Basaglar] uptake."

Once people try biomiliars, they are likely to use them again (assuming the price is lower, almost no one is going to pay any more for them), which is a good omen for the U.S. biosimilar industry.  Also, once there are several different manufacturers of the same type of insulin, prices are likely to come down a bit further, although the industry has a problem because it pays enormous rebates to insurance companies through their pharmacy benefits managers (PBM's), so big rebates are expected to get drugs on insurance company formularies; failure to do so means the product is less likely to sell.  The drug industry has convinced itself that incremental improvements are sufficient to drive sales growth going forward, and perhaps if its the correct incremental improvement, they'll be right.

But ... marginal improvements won't guarantee that payers will be willing to buy it for a higher price.  I think those days are over.  Payers are in control, and they aren't falling for bogus tricks pharma used in the past.  Look at Humalog sales as proof.  They are declining in the face of growing price pressure (as have prices for rival products, such as Novolog from Novo Nordisk and Apidra from Sanofi).  With a biosimilar version of Humalog recently launched in the U.S. (more on that in the next few paragraphs), we may not see huge improvements from a margin perspective.  The big insulin makers are hoping that slightly-faster versions including Novo's Fiasp which is a faster version of Novolog has already been introduced, and Lilly promises a newer, faster version of Humalog is right around the corner.  But most of the growth is coming from outside the U.S.

Why Lilly Likely Pursued Basaglar

For Lilly, the biosimilar basal insulin Basaglar filled an enormous void in its insulin portfolio because for nearly 10 years, Lilly sold no basal insulin analogue at all, only a century-old variety that many doctors and patients disliked (OK, the latter hated) using because it could be very unpredictable.  That also resulted in the company not being listed on some insurance formularies, which did not help the company's long-standing insulin business.  Several years ago, Lilly hired an executive named Enrique A. Conterno to run the company diabetes business.  Under his leadership, Lilly is no longer being dropped from formularies in favor of Novo Nordisk insulin varieties, and has even gained share, although a lack of a basal analogue meant payers had to secure those from another company.

Sanofi immediately sued Lilly over Basaglar, but because it was coming from insulin giant Lilly, Sanofi knew what it could and could not get away with.  Whether Merck or Mylan can do the same thing for their Lantus biosimilars remains to be seen.  But I stand with the idea that more competition never hurt consumers (or in this case, patients!).  We know, for example, that Mylan's Semglee is already approved in Australia (see the press release for details), so it seems as if its only a matter of time before its available at U.S. pharmacies, and the lawsuit is the main impediment right now.  While Mylan is new to the U.S. insulin market, it's no stranger to the legal environment that pharmaceutical sales in the U.S. must contend with.  Ditto for Merck.

Sanofi was probably not happy that a rival insulin-manufacturer Lilly was the first to copy its bestselling Lantus, which had been one of Sanofi's most profitable products for nearly two decades.  But it wasn't competing with a tiny startup, but one of the oldest insulin-manufacturers still in existence, so Lilly was pretty tough to bully in court.  The two eventually settled for an undisclosed amount, and I'm guessing Sanofi will expect future settlements to be comparable in size for the Merck and Mylan versions of Lantus (Lusdana Nexvue and Semglee, respectively), although as more competition emerges, the value of the Lantus product will continue to decline, hence settlements will likely decline, too.  The fact that Medicare cannot negotiate prices is a major problem that pharma wants to continue and may continue under the current Congress and Donald Trump, but at some point, the largess of taxpayer dollars being paid to big pharma will likely be challenged by lawmakers, and then the dynamic could change dramatically.

Next Category of Insulin Biosimilar: Humalog Copy from Sanofi Called Admelog

Sanofi decided it would return the favor and sell a Humalog copy (U-100 insulin lispro rDNA origin) which it secured FDA regulatory approval for on December 11, 2017.  It's slightly less clear to me what the business objective for Sanofi to introduce a Humalog biosimilar, even if its already now on the U.S. market.  However, there's definitely some tit-for-tat going on, and it may what be the industry needs in the absence of innovation.

Plus, Admelog COULD lead to cannibalization of Sanofi's own rapid-acting insulin analogue (which still enjoys patent protection, though its less likely able to command a premium given that both Humalog, and very soon Novolog will no longer have U.S. patent protection) known as Apidra (U-100 insulin glulisine rDNA origin), but it might help the company secure coverage on a few insurance company formularies.

Unlike Lilly and Novo, it does not sell all insulin varieties that it could be selling ... the company refuses to sell its old biosynthetic 'human' insulin regular and isophane sold under the brand name Insuman (I referred to that insulin brand in 2015, catch that post at for more) and I stand with my original thoughts on that.  For Sanofi, the formulary game is one the company has utterly failed at doing for anything other than Lantus.  Its more recent, higher-concentration (U-300 varieties) and combo insulin-GLP products simply aren't sufficient anymore.  Right now, it continues to offer HUGE rebates to pharmacy benefits managers (PBM's) and insurance companies to keep Lantus on many formularies.  Right now the company is selling it with discount cards, and while the price is somewhat lower than Humalog itself, its only marginally less expensive IMHO.  But when the primary means of selling it is via discount cards, then the longer-term business strategy is unclear to me.  Maybe it's just to compete with Lilly since Lilly has also lost patent protection for its only analogue?

As I noted already, it's somewhat less clear to me what the business objective for Sanofi is by introducing a Humalog biosimilar.  After all, offering Admelog COULD cannibalize Sanofi's own rapid-acting insulin analogue (which still enjoys U.S. patent protection, for the time being, anyway) known as Apidra (U-100 insulin glulisine rDNA origin), but it might help the company secure coverage on some insurance company formularies ... although the company still does not sell its old biosynthetic 'human' insulin regular and isophane sold under the brand name Insuman (noted above), which may be an impediment to getting on insurance company formularies.

As for the prospects of additional biosimilars, that is unclear right now.  I suspect that as patents expire for Novo Nordisk's Novolog (U-100 insulin aspart rDNA origin) which will be the next patent to expire, we could see biosimilar versions of that from both Lilly and Sanofi.  Merck and Mylan could decide to pursue copies as well.  We could potentially see biosimilars come from Novartis' Sandoz business unit, and while Israel's Teva is also a possibility, that company has some bigger management issues to resolve in the short-term.

But, as I wanted to see in 2006 (when I first started researching the issue), the era biosimilars is finally here.  The market dynamics are very different today from 10 years ago.  I would remind my readers that biosimilars are actually very different from non-medical switching (such as an insurance company forcing a patient who uses Novolog to switch to Humalog, which is NOT the same insulin).  In fact, so far, the incidence of complaints about biosimilars have been more about poor communications and patient confusion with patients asking if they have to switch from Lantus to Basaglar, for example, when they are really the same insulin.

Biosimilars are not generics and some patients may have issues with them.  For example, they use different vectors in culturing them, such as how Novo Nordisk uses yeast whereas Lilly uses bacteria in making insulin.  Also, each manufacturer may use different preservatives in their insulin formulations which can cause allergies in some patients, and they use different ampoule/vial shapes and/or stoppers), and the packaging colors may be different.  But the products are likely more similar than different insulin varieties are.

So far, I have NOT heard of as many reports of patient problems switching to/from biosimilars as I have with non-medical switching from one insulin variety to another.  Unfortunately, price cuts are also not as big as we've seen with traditional, generic small-molecule drugs.  But non-medical switching may be a tinderbox waiting to explode (see more at and for detail) will be an ongoing debate and challenge, but I suspect (and sincerely hope) there will be fewer issues with the emerging market for insulin biosimilars.

Author P.S., October 12, 2018: There was news today based on securities filings in South Korea that Merck and co-development partner Samsung Bioepis will terminate its plan to introduce a (see more HERE for details) to introduce a Lantus (U-100 insulin glargine rDNA origin) biosimilar that was to be branded as Lusdana Nexvue) in the U.S.. For its part, Merck said absolutely nothing about it, but Samsung Bioepis was the one to disclose to shareholders that Merck had terminated its agreement on the product saying that Merck had canceled the development and commercialization partnership for the Lantus biosimilar, dubbed Lusduna Nexvue in the U.S. As a result, Merck paid Samsung Bioepis $155 million to cover the investment Samsung had made so far in the product, plus interest, a spokeswoman for the company confirmed.