Friday, October 01, 2021

Some Key EASD News for T1D

This week, the European rival to the ADA Scientific Sessions known as EASD (which stands for the European Association for the Study of Diabetes) held its annual meeting, which was the organization's 57th Annual Meeting and it took place virtually (much like the ADA Scientific Sessions did this year) due to COVID-19. EASD was held from September 27, 2021 to October 1, 2021. In recent years, neither the ADA Scientific Sessions not the EASD Meetings have yielded many surprise findings or previously unknown product launches.

My short summary is that Novo Nordisk is finally getting on the "smart pen" cap bandwagon, while rival Lilly cut list prices for insulin lispro by another 40%. Read on for details on both.

A little-noticed news item this year's EASD came from Novo Nordisk, which is a company which has occasionally described itself as a diabetes company but has tried to shift gears and today describes itself as a "Danish multinational pharmaceutical company", and the company's origins were as two of the original licensees to make insulin from the University of Toronto dating back to the 1921 discovery on insulin (Lilly and Sanofi [whose modern day origins were as both Canada's Connaught and Germany's Hoechst] happen to be two others). Truth be told, Novo Nordisk is a company which once dominated the Scandinavian diabetes market, but it has used fat profits generated in the United States to go on a global acquisition binge, eliminating formerly-independent insulin makers in countries such as Brazil (Anyone remember the company known as Biobrás? It disappeared around 2002 when Novo Nordisk bought the company using profits generated in the U.S.). 

Incidentally, as hinted, Novo and Nordisk were previously two independent companies who both made insulin, but the two insulin manufacturers merged into a single company back in 1989. Its U.S. presence occurred since the company acquired a joint-venture started back in the early eighties with a U.S. drug company then known as E.R. Squibb & Sons (one of several predecessors to today's Bristol Myers Squibb). Shortly after Novo and Nordisk merged, the company then acquired Squibb's half of the joint venture in 1989 (I'm old enough to remember those origins of the company's relentless acquisition binge).

Anyway, Novo Nordisk is perhaps best known as the company which originated the insulin pen back in the late-1980's. In Europe, most patients prefer using insulin pens, rather than insulin pumps as an insulin delivery mechanism. Aside from not having to wear all the items associated with insulin pumps (infusion sets, a bulky pump generally requiring tubing and batteries, and now, a separate CGM sensor, etc.), insulin pumps are not the worldwide standard of care for autoimmune T1D, rather the insulin pen is in much of the world. But the U.S. is not like the rest of the world; here insulin pens are far less common and also vastly overpriced (as is insulin generally).

Anyway, coinciding with the 2021 EASD meeting, Novo Nordisk announced (see the announcement HERE) a new partnership with a France-based company known as Biocorp which specializes in the design, development, and manufacturing of "innovative medical devices". The Novo Nordisk-Biocorp partnership will reportedly leverage that company's Mallya platform and will be for the Novo Nordisk prefilled pen platform to develop smart insulin pen caps (not too dissimilar from the Bigfoot Unity system).

As part of the partnership deal with Novo Nordisk, Biocorp will receive an upfront payment from Novo Nordisk and different milestone payments are defined staging the partnership's development phase. Upon successful development, Novo Nordisk then plans to distribute the smart pen cap devices in "selected countries", and Biocorp expects to ramp up production volumes from 2022. Most likely, the United States will be excluded from the initial launch, which seems poised to go to Europe first which has a higher incidence of insulin pen users and few patients who struggle to pay for basics such as insulin which have driven many to return to vials and syringes because the cost per unit is lowest that way. Maybe a Novo Nordisk-Biocorp smart pen cap will come to the U.S. and Canada a bit later, once the bugs are worked out. Maybe.

Currently, the number of smart insulin pens is growing on a global basis. 

Novo Nordisk has been an outlier by not offering one. Smart insulin pens work with smartphones and enable patients to compute their dosages more accurately, to monitor insulin-on-board (IOB), and to automatically track their dose logging, all of which have traditionally been absent in patients treated with multiple daily injections (MDI). San Diego-based Companion Medical (which was acquired by Medtronic diabetes in August 2020) offers one smart pen called InPen

InPen uses insulin cartridges which are another Novo Nordisk invention. But many U.S. patients struggle with pens/cartridges because while their insurance may pay for the InPen itself, their insurance pharmacy benefits sometimes will not cover the more costly insulin pen cartridges, which makes no sense. But pharmacy benefits in the U.S. no longer make sense anyway when more than half of all plans have high-deductibles. 

Novo Nordisk's affordability option (which was copied from Lilly, which innovated it) - an "authorized generic" or "authorized biosimilar" branded as Novo Nordisk Insulin Aspart may assist on that because it assuredly is less costly and readily-available, but is not widely known about, but Lilly's cheaper Lilly Insulin Lispro option does not include insulin pen cartridges --- in the U.S., pen cartridges are a bit of an anomaly. Lilly does makes them for Humalog, but Sanofi doesn't sell pen cartridges for either its own rapid-acting analogue Apidra nor the biosimilar Admelog. Pen cartridges are more of a Novo Nordisk thing. Given that much of Lilly's sales growth is in the less-heavily rebated insulin variety, maybe that will change, but I wouldn't bet on it.

A slightly newer smart pen offering is Bigfoot Biomedical's Unity smart pen cap system, which was the company's first-ever FDA approved medical device which is unique in that it works with the Abbott Freestyle Libre 2 flash glucose monitoring device (rather than Dexcom), tying the disparate pieces together into a seamless system which works nicely and adds features not present in the existing devices, such as automatic CGM readings, sharing and low blood glucose alarms that American CGM users have come to expect as core CGM features. 

Bigfoot has a rather peculiar distribution system which is currently merchandised through something called the Bigfoot Clinic Hub, which an endocrinologist must subscribe to. But many endocrinologists which are part of large group medical practices (increasingly, many are owned by hospital chains) are effectively locked out of offering Bigfoot Unity to their patients. I think Bigfoot's Clinic Hub is an effort by the company to establish widespread relationships with endos treating diabetes so that when the company's bigger and more expensive smart insulin pump system launches, so they will have established doctor relationships which will help them sell their other products. Right now, those relationships are few in number so it is impossible to simply buy a Bigfoot Unity smart insulin pen cap. Whether that changes over time remains to be seen.

But Europe is not like the U.S., and universal healthcare coverage is the general rule across the European continent. Patients in Europe generally don't struggle to get coverage of basic necessities like insulin as they often do in the United States, they just walk into the pharmacy and pick it up when needed, often free or a rather marginal cost. By comparison, in the convoluted U.S. market, patients walk into a pharmacy and may be charged more than $300 for a 10 ml vial of insulin, which is insane and has resulted in one in four patients with insulin-requiring diabetes to ration insulin. Its as if the U.S. is like a third-world country where patients struggle to attain adequate medical care.

The Novo Nordisk-Bicorp deal has potential to add the benefit of smart insulin pen dosing and tracking of IOB and dosage tracking to Novo Nordisk's no-longer-so-innovative prefilled insulin pens, and it could result in lower costs since Novo Nordisk mass-merchandises insulin pens on a worldwide basis. So Novo Nordisk is developing smarter insulin pen caps. 

Meanwhile, recall that in 2018, Lilly announced what it's calling the Lilly Cambridge Innovation Center located in the biotech hub of Cambridge, Massachusetts (it is located in Kendall Square, in the footsteps of Massachusetts Institute of Technology/MIT and just 2 subway stops on the MBTA Red Line away from Harvard University) to develop what it calls a "Connected Diabetes Ecosystem" (or "CDE") featuring either a closed-loop system using either an insulin pump or smart pen, integrated CGM and/or blood glucose meters, a smart dosing/control algorithm, and a robust smartphone app to tie the pieces together. 

Diabetes Mine covered that at So far, patients haven't seen much come from that yet, but perhaps the Novo Nordisk deal with Biocorp is an effort to play catch-up since the Danish company's insulin pens may be widely-used, but are assuredly not "smart" pens -- the current Novo Nordisk FlexPens are actually rather stupid devices right now.

Perhaps also timed to deliver a slap in the face to its biggest insulin making rival, Eli Lilly & Company made another big announcement (maybe to steal Novo Nordisk's thunder) during the EASD. Remember when Novo Nordisk announced a deal with Walmart to sell a less costly co-branded version of Novolog at Walmart pharmacies at a discounted price, just as the ADA Scientific Sessions was closing? Lilly's announcement seems to be meant to steal some thunder from its Danish insulin-making rival just as the Novo Nordisk-Relion Novolog announcement made earlier this summer at the ADA did.

Lilly, like Novo Nordisk and Sanofi, has been on the hot-seat for much of the past decade over runaway U.S. insulin prices, so it did something a bit unexpected during EASD: it announced it would be further reducing the list price of Lilly Insulin Lispro Injection by another 40%, which is the "authorized generic" version of the company's now out-of-patent Humalog, the rapid-acting insulin analogue which has since been one-upped by the company's marginally-faster (and still patent-protected) Lyumjev insulin. When the less costly product launched in 2020, it was widely promoted as being a half-priced Humalog at the time. Lilly’s press release revealed “Approximately 1 in 3 prescriptions for Lilly's U-100 mealtime insulin – Lilly's most commonly used insulin formulation – is for Insulin Lispro Injection.”

In 2020, Lilly introduced its "authorized generic" version of Humalog as a new affordability option. When it launched, the press quickly called it "half-priced" Humalog because the bogus list price was half of what brand-name Humalog sold for. Savvy patients quickly discovered that "half-price" was also bogus; they could get vials (or prefilled pens) of Lilly Insulin Lispro for about 75% less than brand-name Humalog by using a readily-available GoodRx coupon (or from several rival Rx coupon-generating apps). The Lilly deal worked so well that Novo Nordisk quickly copied it, launching its own authorized generic/biosimilar of insulin aspart.

Lilly's marginally faster version of Humalog branded as Lyumjev is still trying to build awareness and a customer base (and is still patent-protected, unlike Humalog), much as Danish rival Novo Nordisk has started doing since it launched Fiasp (a name derived from F aster I nsulin ASP art) in 2017. Neither Fiasp nor Lyumjev are very big right now, but the companies are widely expected to simply stop making the older products and replace them with the newer, slightly faster versions instead, leaving biosimilar makers to fight amongst themselves for selling less costly, slightly older, un-patentented insulin varieties. 

Those newer products seem poised to replace the slightly older (and now out-of-patent) rapid acting insulin analogues -- and if history is any indication, the companies may ultimately just stop making the older varieties -- effectively "retiring" them just as they previously did with Iletin as well as the entire biosynthetic "human" Lente series: Humulin S, Humulin L, Humulin U. It wasn't that patients weren't using those products. Its just that Lilly had invested millions in its Genentech biosynthetic "human" insulin varieties, so they decided to retire the old product lines and FORCE patients to use the newer, more costly patent-protected products instead.

Humalog is still the real Lilly insulin blockbuster, but its patents have all expired or will expire soon, and more biosimilars may be coming before long. There is already a biosimilar of Humalog made by Sanofi branded as Admelog on the market, but it is very expensive and sales are declining as a result of its price. Currently, I'm not aware of any other biosimilars of lispro and I'm also not aware of any currently in development. 

But right now, there are at least two or three biosimilars of Novolog (aspart) in development from Viatris/Biocon, Lannett/HEC. Sanofi also makes one sold in Europe, but that company has been non-committal about introducing it in the U.S. because sales of its Humalog biosimilar branded as Admelog have evaporated into thin air because it is actually more expensive than Lilly's Insulin Lispro is. Right now, even with a manufacturer discount coupon from Sanofi applicable to Admelog, the lowest cost for Sanofi Admelog (U-100 insulin lispro rDNA origin) is $99/vial. But Lilly Insulin Lispro can be bought for just $48.85/vial at CVS Pharmacies nationwide using a GoodRx coupon, which is about half the price of Sanofi's biosimilar. This is another manifestation of what Wall Street refers to as "rebate walls" drug companies use to eliminate or inhibit potential competitors. Whether it is accomplished with coupons, or secretive rebates paid to insurance company-owned PBM's, the impact is that it is anti-competitive, and it is very likely illegal.

But for Lilly, its sales numbers do not lie. Heavily-rebated brand-name Humalog are slowing, while the "authorized biosimilar" branded as Lilly Insulin Lispo are more than making up for it. Hence, the company announced during EASD that it would be further reducing the price of the authorized biosimilar Lilly Insulin Lispro by another 40% starting in January 2022. (see the press release HERE -- that could potentially force Novo Nordisk to do the same. It is also less difficult for Lilly execs to simply bypass the whole Rx rebate mess. They won't need a sales staff dedicated to selling to PBM's and insurance company formulary managers. Landing one is still a big boost to sales, so it may continue, but it may not be Lilly's sole marketing focus anymore since it can still generate sales growth without landing a big insurance company/PBM formulary.

The move makes sense financially for Lilly. In Lilly's Q2 2021 investor earnings presentation, Lilly revealed that while sales of Humalog had increased 9% on a worldwide basis compared to Q2 2020, sales of its heavily-rebated (to PBM's) brand-name Humalog had actually fallen, yet Lilly Insulin Lispro sales had grown, resulting in the company's workhorse rapid-acting insulin analogue Humalog sales growing slightly year-over-year. Sales of its new-and-improved Lyumjev were still too small to impact the bottom line in a meaningful way.

For Lilly, just maybe, the ever-higher insulin rebates needed to "bribe" (secure) commercial healthcare insurance company formulary placement might be a huge waste of corporate cash. After all, Novo Nordisk now admits that it is paying 74% of the company's gross sales as rebates paid to PBM's. Lilly's sales numbers for Humalog suggest that it might just be working. If so, it has potential to alter the rebate-driven U.S. insulin market as we currently know it.

During Q3 2020, the Novo Nordisk rebate figure paid to bribe, err...I mean to secure, commercial healthcare insurance company formulary placement was 71%. The next quarter, the rebate figure was up another 3% totaling 74% of Novo Nordisk's gross insulin sales. 

Prior to that, the company tried to keep the Rx rebate figure a secret, but investors kept asking the company about it. In fact, in 2017, Novo Nordisk shareholders sued the company saying company management mislead them on the magnitude of its pricing pressures. In a court filing, the plaintiffs of the shareholder lawsuit said that while other companies told investors that their insulin-related revenues would diminish as a result of pricing pressures, Novo Nordisk executives falsely assured investors that "the company was not subject to the same pressures and that its sales and profits would continue to grow". That was a lie. Evidently, the pricing pressures for Novo Nordisk were exactly the same as its competitors faced. The company's CEO at the time, Lars Rebien Sørensen, uncharacteristically "retired early". Perhaps not coincidentally, just this week, Novo Nordisk agreed to settle the lawsuit with shareholders to the tune of $100 million (to be paid for by insurance).  

Novo Nordisk is Addicted to U.S. Rebates Paid to PBM's to Drive Sales, But Rebates Are Also Driving Its Profits Way Down

Nevertheless, Novo Nordisk has steadily continued increasing rebates, quarter-after-quarter. As noted, the company has increased the percentage about 3% each quarter. That is the only way Novo Nordisk insulin sales in the U.S. have grown.

But to what end? 

PBM appetite for rebates is endless. Will Novo Nordisk stop when they are giving PBM's 99% of their sales as rebates? 100%? That indeed explains why the company has shifted almost entirely to GLP-1 inhibitors for Type 2 diabetes which now drives virtually all of the company's revenues now.

Lilly seems to be concluding that maybe its best option is to shift away from the rebate-driven sales model. 

I also believe that Lilly sees potential legal troubles ahead on the hidden rebates paid to insurance company owned pharmacy benefits managers ("PBM's"). There is no secret that PBM rebates are on the Federal Trade Commission's ("FTC") radar. So far, each of the public FTC meetings over the past few months have featured a steady number of independent pharmacy owners complaining about PBM's contract abuse, and more recently, patients alike have testified, decrying that their insulin prices are growing, not falling, in spite of bogus PBM assertions of how much savings they generate. The FTC was recently asked by Congress to look into PBM "rebate walls" and the FTC issued a terse "report" which really looked more like a promise to examine the anti-competitive PBM practices. 

FTC commissioners have finally promised to investigate the "rebate wall" matter further. Several FTC commissioners have opined on the matter, including FTC Commissioner Rohit Chopra and FTC Acting Acting Chairwoman Rebecca Kelly Slaughter

The roots to all of it is the nonsense PBM's have been getting away with by keeping what they do a secret, but it looks to be illegal. But the key unanswered question is when the U.S. Federal Trade Commission will finally begin suing the pharmaceutical industry and the PBM's for illegal "tying"? I suggested that needs to happen in September 2021. It seems pretty clear that a case likely exists, the question becomes when they will begin prosecution. It is for that reason that I think Lilly may finally be realizing rebates paid to PBM's are criminal and could get the company into trouble if FTC were to sue Lilly. That said, Novo Nordisk is full speed ahead on rebates, but it may be forced reconsider in light of what Lilly is now doing. Every time an insurance plan favors a branded drug (with a rebate) over an identical "authorized" generic/biosimilar (without rebate), it's looks to be a bribe that might be in violation of:

  • Clayton Act Sec. 3 (exclusionary rebates)
  • Sherman Act, Sec. 1 (exclusionary rebates)
  • Rob. Patman Act
  • Anti-Kickback Statute

Now the question is when the FTC finally start filing lawsuits?! I think we can expect the FTC to conduct some research into the matter (it is well-equipped to do so) so that new Biden FTC leadership means that the Trump FTC commissioners are outnumbered and have consistently lost on key FTC procedural votes. Let's hope FTC acts relatively quickly, but collects enough data to actually implement long-overdue changes to the way prescription drugs in the U.S. are merchandised and sold.

Tuesday, September 14, 2021

U.S. Patients Need U.S. FTC to Do More to Bring Rx Drug Prices Down to Earth

For a moment, try to answer the following question honestly:

When are biosimilar insulins, even those which are designated by the FDA as "interchangeable" with the innovator, MORE EXPENSIVE than the originator molecule the biosimilar is supposed to be a copy of? 

The correct answer is when a person with diabetes lives in the United States. 

It defies logic!

In theory, the biosimilars should be cheaper because the work of developing, conducting clinical trials and whatnot is not the same to make a copy. The biosimilar doesn't have to go through the same process of conducting extensive three phases of clinical trials, submitting all of their trial data to the FDA for close regulatory scrutiny, then introducing the newly-approved product to the world AND commercializing it/bringing it to market. In theory, that SHOULD mean biosimilars are therefore cheaper, much like generic small-molecule drugs are, which can be up to 90% cheaper if there are versions on the market from six different manufacturers according to the FDA's own reporting (see for more info).

In the United States, seemingly every entity involved in the sale and distribution system for pharmaceuticals works tirelessly to hide the true info about pricing and also works tirelessly to try and keep the true prices hidden from any public scrutiny in hopes that no one ever truly discovers how screwed up the U.S. prescription drug market really is.

Case-in-point: in recent years biosimilars have finally started to emerge in the U.S., and even more are coming according to several companies in the space. 

Biosimilars will be aimed at all sorts of medical conditions, and the elusive promise is that biosimilars might save consumers money because the makers of the biosimilars can avoid many of the costly R&D and development costs that the innovators incur to bring those medicines to market. That sounds logical.

That's how it is SUPPOSED to work in a functioning marketplace. 

But the U.S. prescription drug market is not functioning properly. It does not resemble a true market in any sense of the word. It is messed up by hidden discounts given in the form of rebates paid to Pharmacy Benefits Managers (PBM's) and bogus drug list prices and secrets designed to prevent the competition from knowing what the drug companies are actually doing behind-the-scenes. 

Unfortunately, nearly everyone KNOWS what they are doing now, and some of it appears to be in violation of Federal laws. The FTC has a lot to unpack and has for years has failed to protect Americans from unregulated monopolies, but new leadership under Lina Khan appears to be taking the job a bit more seriously than many recent individuals who had her job in the past, who saw their job as little more than to give rubber-stamp approvals to mergers and acquisitions.

Naturally, insulin prices are impacted by a severely broken market, but perhaps not in the way you might anticipate.

For example, on July 28, 2021, the U.S. FDA made a big deal of how the regulator had approved the first-ever "interchangeable" biosimilar medicine which is not only biosimilar to, but also interchangeable with (meaning it can be substituted for at the pharmacy counter without permission) the reference product known as Sanofi Lantus (U-100 insulin glargine rDNA origin). perhaps not surprisingly, the first-ever interchangeable biosimilar was a form of insulin. The reason it is unsurprising is because biosynthetic "human" insulin was the first-ever biotechnology medicine approved by the FDA back in October 1982.

Acting FDA Commissioner Janet Woodcock, M.D., whom many believe to be especially favorable to the very industry the FDA is supposedly regulating and overseeing, made a cautiously optimistic statement about the development because she very likely KNEW it was likely more hype than hope. Janet Woodcock is seen as someone who puts the drug industry's needs over public safety, and many believe she should not be named as a permanent FDA Commissioner, which is rather odd, considering this woman has worked most of her career at the FDA.

"This is a momentous day for people who rely daily on insulin for treatment of diabetes, as biosimilar and interchangeable biosimilar products have the potential to greatly reduce health care costs. Today's approval of the first interchangeable biosimilar product furthers FDA's longstanding commitment to support a competitive marketplace for biological products and ultimately empowers patients by helping to increase access to safe, effective and high-quality medications at potentially lower cost" Woodcock said (see for the complete statement).

Note how she said that the interchangeable biologic "has the potential" to greatly reduce healthcare costs, but she never said it actually would do that. The reason is because the U.S. prescription drug market is fundamentally broken. Being a broken, corrupt market makes it very difficult for patients to avoid being taken advantage of by invisible parties who work behind-the-scenes to screw anyone and/or everyone in that dysfunctional "market" to fill their own wallets instead.

The reality is that Viatris/Biocon Semglee (U-100 insulin glargine rDNA origin), wasn't even the first Lantus biosimilar approved by the FDA or to be commercialized (that distinction belongs to Lilly's Basaglar, which is U-100 insulin glargine and that first received tentative FDA approval for Basaglar on August 18, 2014, followed by an official FDA approval on December 16, 2015 following an out-of-court settlement between Lilly and Sanofi. Sanofi had sued Lilly over supposed patent infringements). Lilly's Basaglar did so several years before Semglee even secured FDA approval, let alone getting the subsequent "interchangeable" designation. 

Part of the reason for the initial FDA "tentative" approval of the Lilly's biosimilar insulin glargine was because Sanofi immediately sued Lilly for a host of different things ranging from patents on manufacturing processes to insulin pen designs and various other things which triggered an automatic stay of 30 months to allow the companies hash out their legal disputes in a court of law.

Sanofi knew it had no chance of actually winning its patent infringement lawsuits against Lilly (who had been making insulin since the 1920's -- years before the FDA even existed), so the two companies ultimately agreed to quietly settle the litigation out-of-court. On September 28, 2015, Lilly announced it had entered into a settlement agreement to resolve various patent dispute litigation charges with Sanofi regarding its insulin glargine product. Lilly began commercializing its own Lantus copy branded as Basglar in January 2017.

One outcome of the Lilly/Sanofi out-of-court settlement over the Sanofi glargine patent infringement assertions was that rival Sanofi would also be allowed to sell a biosimilar version of Lilly's U-100 Humalog/Insulin Lispro (which Sanofi branded Admelog) and Sanofi would not be sued by Lilly over that. Sanofi very quickly did so (it was already selling a biosimilar of Humalog in parts of Europe at the time, so it was very easy to import the vials and pens from Germany where they were already being sold). 

Recall that I personally tried Sanofi's Humalog biosimilar branded as Admelog (catch my post HERE for more on that), and I still believe it was far more interchangeable (in spite of not having the FDA "interchangeable" designation which did not exist at the time Admelog was FDA approved in December 2017) with Lilly's Humalog than any so-called "therapeutically equivalent" rivals which formulary managers treat as interchangeable even though they are not, such as Novo Nordisk's Novolog, Fiasp or Sanofi's own Apidra (U-100 insulin glulisine rDNA origin). It would be nice if insurance companies were obliged to cover additional test strips to accommodate such routine non-medical switching due to formulary changes, but again, commercial healthcare insurance companies fail to do that. In fact, non-medical switching between rapid-acting analogues which is driven primarily by rebates paid to PBM's, has increased in frequency, not decreased. I have routinely been bounced between Lilly Humalog/Lispro and Novo Nordisk Novolog/Aspart which I've never liked. Aspart is, for me, a vastly inferior insulin variety which works incredibly slow (I derisively call it "slow-mo" log) and therefore requires a higher dosage to end up at the same glucose reading as I would require with lispro. None of that matters to commercial healthcare insurance company formulary managers managed by Pharmacy Benefits Managers (PBM's), the ONLY thing they care about is which company pays them most money in rebates.

Still, when Lilly's biosimilar version of Lantus called Basaglar hit the U.S. market, patients were not impressed by the price tag of Lilly's glargine product. It was priced practically the same as Sanofi's Lantus was, meaning it delivered no meaningful savings for patients who use that particular insulin variety. Considering Lilly invested very little in R&D on the products because rival Sanofi did all that in the original trials, the price tag was questionable. Lilly simply backwards-engineered the product, set up bioreactors to culture the insulin biosimilar, and then harvested the outcome. It was not a huge investment for Lilly.

However, Viatris (then known as Mylan) and Biocon never actually had to settle over similar lawsuits which Sanofi had levied against them related to Lantus (both Mylan and Biocon were co-developers, but Mylan handled the U.S. regulatory aspects of applying for and attaining FDA approval for sale in the U.S. and was the company which was sued). Because Biocon had encountered FDA regulatory approval problems over non-adherence related to Good Manufacturing Protocols (GMP) for biotechnology medicines made at the company's brand new factory in Malaysia, the FDA was unable to formally approve Semglee as quickly as it had approved Lilly's Basaglar. Because its manufacturing facility needed to be re-inspected before the FDA could approve it, rather than Mylan (now Viatris) settling with Sanofi out-of-court, the company simply let the litigation go to trial, which is where things got kind of interesting. The FDA then re-inspected the Biocon insulin factory located in Johor, Malaysia in February 2020 and ultimately approved it.

Nevertheless, when the Sanofi-Mylan insulin litigation actually went to trial, the judge threw out ALL of Sanofi's Lantus patent infrigement claims as baseless and unsupported by any evidence presented by Sanofi. In effect, Mylan (and co-development partner Biocon) was a very big winner because it did not have to settle with Sanofi for any money or licensing fees, and the court judge threw-out the bogus Sanofi patent infrigement claims out as invalid, thereby freeing Mylan to sell its own Lantus knockoffs without paying Sanofi a settlement. It also opened the door for others to rely upon that court precedent to fight against any Sanofi patent infringment claims that get levied against them, too. Lannett Company and its Chinese co-development partner HEC are counting on that for their own Lantus biosimilar, and they could easily point the court to the Sanofi/Mylan trial record as relevant judicial precedent.

In any event, since that time, the company known as Mylan subsequently merged with a Pfizer spinoff known as Upjohn on November 16, 2020. The newly-merged company then changed its name to Viatris. But insulin and other biologics merchandised by Viatris still come from the Indian biopharmaceutical giant Biocon which invested in a massive, new insulin manufacturing facility intended to serve the developed world located in Malaysia.

David Balto, former Policy Director at the Federal Trade Commission (FTC), is concerned about the lack of meaningful patient choice resulting from anti-competitive contracting practices that have been established by a number of drug makers and facilitated Pharmacy Benefits Managers ("PBM's") who help them to make drug formulary decisions for insurance companies (the top 3 PBM's are now wholly-owned business units of CVS Health/Aetna/Caremark, Cigna Express Scripts, and United Healthcare's OptumRx). Balto draws attention to "rebate walls", which are defined as exclusionary contracting practices that a drug manufacturer deploys to limit the ability of rivals from gaining preferred access to the formulary, or any access at all. 

"Rebate Walls" are the primary reason that biosimilars (including biosimilar insulin varieties) sold in the U.S. are MORE costly than the innovator brand-name drugs such as insulin, and Lantus provides a vivid case-in-point. 

Branded drug manufacturers leverage their position as market leaders by offering financial incentives to PBM's and health insurers in the form of "all or nothing" conditional volume-based rebates, in exchange for virtually exclusive positioning on the formulary. This can mean keeping competitors off the formulary entirely, or severely limiting formulary access to a competing drug through the use of step edits. Here, a patient must use a preferred drug and fail on it (a so-called "fail-first" policy which many patient advocacy groups argue are challenging for certain patients to deal with, especially when formulary "preferred brands" change due to no fault of the patients) before stepping up to non-preferred drug.

Rebate walls are also an entire subject which  the U.S. Federal Trade Commission (FTC) is partially responsible for overseeing compliance with Federal laws. FTC may finally now be considering the matter of rebate walls much more seriously than it has ever done previously. 

For example, in May 2021, FTC Commissioner Rohit Chopra penned an open letter (see his letter at writing:

"In addition to problematic rebating practices, we [FTC] must also examine whether PBM's are engaged in coercive practices that harm patients, independent pharmacists, and public health."

The FTC has a role of protecting and encouraging competitive marketplaces, we currently have a very nascent biosimilar industry which looks like it could be severely threatened by rebate walls. Insulin provides a prime example of rebate walls at work. 

Sanofi Erects "Rebate Walls" Around Lantus; Making it Cheaper than Biosimilars

Just because Semglee is an FDA-designated "interchangeable" insulin with Lantus does not mean it will be less costly to patients.

The prescription drug coupon generating website/app BlinkHealth (which is powered by the PBM known as MedImpact) reports that the list price for Sanofi's Lantus is $302.35/vial. Meanwhile, GoodRx reports that the list price for a vial of Lilly's Basaglar biosimilar (also U-100 insulin glargine rDNA origin) is $250.91/vial, which is no bargain for a biosimilar involving no real R&D. GoodRx also reports the list price for Semglee (another Lantus biosimilar) as $105.47/vial right now, all while patients can buy brand-name Lantus priced for just $99.00/vial ... provided you have a readily available manufacturer ValYOU coupon from Sanofi

In the insulin space, even though Viatris/Biocon Semglee received the FDA "interchangeable" designation with Sanofi Lantus, this means that Semglee actually costs patients MORE money than brand-name Lantus costs, which is completely illogical.

Sanofi's Lantus is hardly alone in erecting rebate walls. 

For example, on December 11, 2017, Sanofi received FDA approval for its insulin lispro biosimilar which the company branded as Admelog (which was approved as part of the company's settlement with Lilly over patent infringements related to the Lilly Lantus biosimilar branded as Basaglar). While Sanofi's Admelog has a bogus list price of $415.91/vial according to Blink Health, Sanofi offers the same ValYOU coupon it offers on Lantus, which brings the price of the Admelog (U-100 insulin lispro rDNA origin) biosimilar down to $99/vial.

Guess what? 

Admelog (a biosimilar) is actually MORE expensive than Lilly's Humalog (or the "authorized generic" known as Lilly Insulin Lispro which was introduced as a way to bypass the whole PBM/rebate mess with a reduced list price compared to Humalog, reportedly half according to the company's press release is cheaper than Admelog (a biosimilar) is. That effectively means that with a GoodRx coupon, patients can buy Lilly Insulin Lispro for just $56.68/vial (the cost is even less if they buy several vials at a time, for example, I paid $161.03 for three vials of Lilly Insulin Lispro, which meant my cost per vial was just $53.68) compared to $99/vial for biosimilar Admelog (provided you give the pharmacist a Sanofi coupon). While that can't technically be considered a true "rebate wall" since it bypasses the whole PBM/rebate mess, there is certainly every reason to conclude that those prices are roughly comparable to the prices Lilly is giving to PBM's who negotiate formulary placement which is discounted using rebates.

As I blogged about a year ago in a post I called "It's the Rx Rebates, Stupid" (see my post HERE), the entire prescription drug rebate matter is deeply harmful to patients and the cost of the U.S. healthcare system, and it is badly in need of fixing. How soon federal lawmakers come to that realization remains to be seen. 

That said, one conclusion in FTC Commissioner Rohit Chopra's recent letter was as follows:

"In addition to legislative efforts, it will be critical for the FTC to rethink its approach of bringing individual enforcement actions, since this strategy is unlikely to combat these problems in a timely fashion. It would be more effective for the Commission to pursue research and conduct rulemarkings that specify when certain pharmaceutical industry practices, such as PBM rebating, are unlawful under Section 5 of the Federal Trade Commission Act."

Today, I wrote and emailed a long letter to Commissioner Chopra to ensure that the FTC does its part related to the broken U.S. prescription drug market. The day after I sent it, I received an email confirming receipt of my letter, with the following statement: "Thank you for your email.  It has been forwarded to the appropriate office for review."

Wednesday, September 01, 2021

Coupons, PBM's ... oh my!

Over the past few years, my coverage of coupon-generating websites/apps has increased by a lot in this blog because those have emerged as a critical way for patients to get prescriptions at lower, PBM-negotiated prices even if they have yet to satisfy an annual insurance deductible or they have no insurance at all. 

In general, coupon-generating websites/apps offer consumers access to the deeper pharmacy benefits manager ("PBM")-negotiated prices on prescription drugs, at prices which are often substantially less than the prices you could otherwise attain as a consumer without the benefit of a commercial healthcare insurance prescription drug benefit which is also managed by a PBM. 

Is it stupid? Sure, but in the dog-eat-dog world of prescription drug prices, you as a patient are obliged to use their stupidity and greed against them!

In effect, coupon-generating websites/apps enable patient consumers to bypass their own PBM and use another PBM instead. It's odd that insured people might possibly find it cheaper to bypass a PBM hired by (or owned by) their own insurance company to manage pharmacy benefits and instead use a coupon to access a different PBM, but thanks to high-deductible insurance plans, a lot of people don't enjoy the benefit of PBM pharmacy benefits until they've satisfied a deductible, so using coupon websites/apps enables them to buy prescription drugs and the savings can be significant (especially on heavily-rebated prescription drugs like insulin). 

While the use of coupons means patients are essentially paying entirely out-of-pocket and contribute nothing towards any deductibles they must satisfy, the savings are often so substantial that only a fool pays what insurance says they should be paying as the bloated cash price for the same prescription drug. As noted, with heavily-rebated drugs such as insulin, instant savings of 75% off the bogus list price (or more) is entirely possible. If you use insurance, you end up paying over $200 for a single vial of insulin, while your insurance only credits you about $55 towards your deductible even though you paid a stunning $200 (or more) for that vial. There are so many entities involved in screwing patients in that scenario that it's kind of hard to know where to begin.

However, it's critical to acknowledge that commercial healthcare insurance companies are the real culprits (or enemies) behind runaway pharmacy drug prices (including insulin) in the U.S. today. There are a variety of reasons, and it wasn't always that way. But changes in healthcare insurance benefit designs created by healthcare insurance companies, and specifically the advent of high-deductible insurance plans (which now cover more than half of all Americans with healthcare insurance according to multiple sources, including The Commonwealth Fund) are the primary reason.

High-deductible insurance plans were initially created for employers who pay a policy's premiums as a way to supposedly share more healthcare costs with the covered individuals rather than via premium increases paid by employer "plan sponsors". In essence, until the covered individual satisfies an annual deductible amount, their healthcare insurance pays nothing. Nada. Zilch.

The IRS also has something to say about that. 

Recall that in 2018, I blogged (see my post HERE) about how insulin needed to be added to the list of "preventative treatments" covered by healthcare insurance companies pre-deductible. It really should have been the responsibility of insulin manufacturers such as Lilly, Novo Nordisk and Sanofi to get their insulin products added to that list. Those companies hire expensive Washington DC lobbyists who could have been deployed to that task and gotten insulin added to the "preventative treatment" list, but the companies never bothered

We should be asking ourselves why didn't they do that?

The Trump Administration had a very long list of failures when it came to reducing prescription drug prices for Americans, but one accomplishment which occurred while the former reality show host was in office happened with some assistance from Congress. Through Congressional testimony on the subject of runaway insulin prices, it had already become very clear that diabetes treatments needed to be added to the very limited IRS list of "preventative treatments" which were eligible for pre-deductible insurance coverage. Congress finally saw their own failure to add insulin to the IRS list, hence lawmakers in Congress finally helped to make that a reality in 2018. Regardless of how it happened, the bad seeds in the insurance industry delayed implementation for many, citing that they could not implement the change until various insurance plan years were signed or renewed (that was a falsehood, they just did not WANT to do so because they wanted to keep lining their pockets with more Rx rebate dollars paid on insulin for at least another year or two).

But time has passed, and increasingly, more and more Americans will now enjoy the benefit of pre-deductible insurance coverage of their insulin. That was long-overdue. I fault the drug companies (Lilly, Novo Nordisk and Sanofi) for their failure to get insulin on the IRS list of "preventative treatments" in the first place. Those companies never used their expensive lobbyists to do that, but they easily could have and should have done so while their lobbyists fought all Congressional and state efforts to control prices. The insulin pricing crisis occurred because Lilly, Novo Nordisk and Sanofi were lazy and they allowed it to happen while naïvely thinking they could safely blame the other party. It didn't quite work out that way, but if the companies were actually paying attention, they really should have known better.

However, for those without the benefit of insurance coverage (including many still satisfying high-deductibles) of insulin and other diabetes supplies, two of the largest insulin makers (Sanofi being the notable exception) implemented an important affordability option as a means of bypassing the Rx rebate mess they alone had created and continue to perpetuate. Their so-called "authorized generic" versions of these insulin varieties have unique FDA NDC numbers, but they are really just Humalog and Novolog with different "generic" labels on them. 

As noted, the "authorized generic" versions of the insulin products have unique NDC numbers. The NDC, or National Drug Code, is a unique 10-digit or 11-digit, 3-segment number, and a universal product identifier for human drugs sold in the United States. The 3 segments of the NDC identify the labeler, the product, and the commercial package size. But Lilly Humalog and Lilly Insulin Lispro is the same exact medicine (made on the same assembly line), and the same is true for Novo Nordisk Novolog and Novo Nordisk Insulin Aspart even if they have different NDC numbers which attempt to bypass the Rx rebate problem.

Lilly was the first entity to introduce an "authorized generic" version of Humalog branded as Lilly Insulin Lispro which was to be available in U.S. pharmacies at a 50% lower list price. In reality, however, savvy consumers quickly discovered they could buy the "authorized generic" product for about 75% off the bogus list price by using freely-available coupons found at GoodRx and some rivals. Coupons are by definition, are a voucher entitling the holder to a discount for a particular product. But coupons have become a way of life in the messed up U.S. prescription drug business. Some would argue that only a chump pays full price. Manufacturers are giving discount coupons away to anyone and everyone, and now that includes patients because of PBM greed.

The result of Lilly's "half-price" Insulin Lispro introduction was that with a GoodRx coupon, Americans can now easily buy insulin sold at prices for about what people in Germany pay for the same insulin (even without insurance), which seems entirely rational. 

For example, with a GoodRx coupon, the price for a vial of Lilly Insulin Lispro is $56.68 at Walgreens. Elisabeth Rosenthal, who is editor in chief of Kaiser Health News wrote in an article published by the New York Times (see ) arguing that the "half-price" Lilly promised wasn't such a bargain, but thanks to coupons, the price is comparable to what Europeans pay for the same insulin, writing:

"In Germany, the list price of a vial of Humalog is about $55 — or $45 if you buy five at a time — and that includes some taxes and markup fees."

The key to that price is a readily-available coupon from GoodRx. Otherwise the price is a more costly $137.35 per vial, which is still quite overpriced.

Rival Novo Nordisk quickly followed suit when the company's Novo Nordisk Pharma Inc. unit introduced what the company called an "Unbranded Biologic" with the introduction of Novo Nordisk Insulin Aspart.  Of note was the fact that Sanofi never introduced "authorized generic" versions of any of its insulin products. Lawmakers took note that the company did not really have an answer when it was asked what affordability efforts Sanofi had taken at the time to address its runaway insulin prices. It's anyone's guess what Sanofi is doing since it is now in preparation of being spun-off as a company to become known as EuroAPI. 

Below are the company press releases for the introduction of "authorized generic" insulins:

Lilly to Introduce Lower-Priced Insulin, PR Newswire, March 4 2019,  

Novo Nordisk launching additional US insulin affordability offerings in January 2020, PR Newswire, September 6 2019,  

On September 28, 2021, Lilly announced that the company planned to reduce the list prices on its Lilly Insulin Lispro by an additional 40% effective January 1, 2022. See the press release at All told, the new price of Lilly Insulin Lispro will be (according to the company) 70% off the list price for brand-name Humalog. The reason is because in the year since introducing Lilly Insulin Lispro, it now accounts for one-third of all Humalog sales, bringing sales growth to the company (even while it loses out to Novo Nordisk which now pays 74% of its gross insulin sales as rebates paid to PBM's) in securing commercial healthcare insurance company formulary placement for brand-name Humalog, which Lilly thinks a lower out-of-pocket price for consumers can enable the sales to continue.

Coupons are really just a way to deliver PBM-negotiated prescription drug discounts to people, including those without healthcare insurance or those trying to satisfy an insurance deductible. Part of the problem is the pharmacies are obliged under their PBM contracts to have artificially-high cash prices which they call their Usual & Customary (U&C) prices. That means the PBM's (which are now owned by the likes of United Healthcare-OptumRx, Cigna-Express Scripts and Aetna-CVS Health/Caremark) are the ones telling pharmacists they cannot offer better prices if someone pays cash. On that, we can blame byzantine PBM rules, and their commercial healthcare insurance company owners indirectly because the PBM's are really tying the hands of pharmacies from offering better prices to cash-paying customers.

Still, coupons are now routinely generating massive prescription drug discounts, often 75% to 95% off the bogus cash prescription price. On insulin, prices are instantly about 75% off depending on which pharmacy you buy it at. In general, coupon-generating prescription drug websites/apps work in the following way:

  1. Start with the pharmacy's bogus U&C cash prescription price
  2. Save money for consumers by providing the with easy access to a PBM's discounted network rates on prescription drugs typically sold as service to commercial healthcare insurance companies
  3. Collect a portion of the transaction fee that pharmacies ordinarily pay to a PBM for paying a drug claim

Behind-the-scenes with many coupon-generating websites/apps are the PBM's that prohibit your pharmacist from giving you a better price as a cash-paying customer. 

The biggest PBM's are now wholly-owned by the largest commercial healthcare insurance companies. PBM's are a deeply corrupt business. These entities are self-serving at the expense of independent pharmacists, drug companies and patients alike, and PBM's are so used to lying they can no longer discern genuine fact from their own fiction created by their PR departments. Entire books and countless articles have been written about PBM wrong-doings, and lawmakers badly need to fix the PBM's if they ever wish to bring U.S. drug prices back down to earth. Lawmakers are finally starting to realize the PBM's are the bad seed in a very dysfunctional market.

The FTC has a role to play too. So far, the FTC has failed.

Recall that a series of mergers in the 1990's actually put drug manufacturers including Merck, Eli Lilly & Company, and SmithKline Beecham in direct control of the most powerful PBM's at the time. That ownership enabled drug companies to then view their competitors' pricing information and place their own drugs over their rivals' on PBM formularies. As the American Prospect chronicled (see

"That raised eyebrows," said attorney Linda Cahn "It's such a conflict-of-interest. Obviously, the PBM's were unlikely to negotiate aggressive terms with their manufacturer parent companies."

In 1997, Linda Cahn filed class-action lawsuits against the two largest PBM's in America (at the time), Medco (then owned by Merck) and PCS Health Systems (then owned by Eli Lilly), for breaching their fiduciary duty to employee health plans and increasing drug costs. The high-profile cases finally motivated the Federal Trade Commission (FTC) to finally crack down on the PBM/drug company alliance. After a series of settlements that removed the benefits of the vertical integration with the drug companies by requiring decisions on drug formularies to be delegated to an independent third-party, Lilly, SmithKline, and Merck all sold their PBM's.

But although the antitrust laws initially worked, PBM's kept consolidating, insisting that gaining market share would produce benefits for consumers. And this time, the FTC kept their hands off. SmithKline sold their PBM, Diversified Pharmaceutical Services, which later sold to Express Scripts in 1999 (now wholly owned by Cigna). PCS was bought by Advance Paradigm in 2000, and the new company then became part of Caremark in 2003. And then, Caremark itself found a buyer in 2007 - CVS, one of the nation's largest pharmacy chains. The Bush-era FTC barely blinked an eye at this vertical combination of PBM and pharmacy and never recommended any divestitures or business changes.

"That was the first unholy union," says consultant Susan Hayes Caremark steered its giant patient network toward CVS stores, through lower co-pays or out-of-network bans. They also got to see all the information in CVS's other PBM deals, using the data to underprice rivals.

There was a time after the drug companies divested themselves of PBM's when they were large independent businesses. It did not last.

Relentless PBM industry consolidation meant that by the 2000's, suddenly there was vertical integration with the healthcare insurance companies that once hired them (insurance now owns the biggest PBM's) which has resulted in formerly big PBM's like Express Scripts now being a wholly-owned business unit of Cigna. Ironically, the Cigna acquisition of Express Scripts was approved without question by the U.S. Federal Trade Commission which is supposed to prevent unregulated monopolies from existing. The FTC also readily approved CVS Health's (owner of the largest PBM known as Caremark) acquisition of the commercial healthcare insurance company Aetna within weeks of giving the Cigna-Express Scripts acquisition a thumbs-up.

The reality is that much like the drug company ownership of PBM's, insurance company ownership is also a deeply anti-competitive threat which truly requires FTC un-doing. How soon that occurs remains to be seen, but we now know it is on FTC's radar screens. Their perspective was from the perspective of community pharmacies. To be sure, those entities have indeed been directly harmed by PBM practices, but the harm is far more widespread than that, and yet PBM's remain incredibly arrogant organizations. 

As the Stigler Center for the Study of the Economy and the State at the University of Chicago Booth School of Business publication known as ProMarket chronicled, the FTC stands out as a government entity which has repeatedly failed to protect Americans from monopolization of prescription drug pricing in the U.S. in spite of clear signs of anti-competitive behavior among PBM's. See their article at for more.

Only now, the latest vertical integration is with insurance companies, which I think FTC is finally rethinking now. How quickly FTC gets its shit together on PBM's remains to be seen. 

FTC chair Lina Kahn is slightly more interested on monopolization in the tech space, including advertising with Google, web services/hosting with Amazon, and Facebook in social media. However, the calls for her to look into PBM's are getting louder and more frequent. Of note is that an early July 2021 public FTC meeting featured testimony from independent pharmacies being harmed by PBM contracts, so its definitely on FTC's radar screens. It is simply too big to ignore.

David Balto, an antitrust litigator and former official with the Federal Trade Commission says: "It's OK to have intermediaries. But PBM's make a fabulous amount of money, even though they're not buying the drug, not producing the drug, not putting themselves at risk."'

Back to PBM-powered coupon-generating websites/apps like GoodRx. The first lesson for consumers who wish to use Rx coupons is to compare ALL of them, and verify the price that your pharmacy will charge you for a given prescription. Use whichever coupon website/app offers you the deepest discount. You are making a choice based upon what saves you the most money since you are paying out-of-pocket.

Behind the scenes of most (not all) Rx coupon-generating websites/apps are a PBM (or in some cases, several PBM's). Looking at the PBM space, of them, only MedImpact Healthcare Systems, Inc. is a San Diego, CA based PBM that remains independent. MedImpact is the last (meaning it is currently the ONLY) independent, stand-alone PBM. The others have all been acquired by the big commercial healthcare insurance companies (or in a slight reversal of roles, in the case of Aetna, which was acquired by CVS Health, as CVS Health is also the operator of the largest PBM known as Caremark, which reportedly pays for about 30% of the nation's prescription drug purchases).

Due to MedImpact's "last man standing" status as an independent PBM, the company was among the earliest to spot sales opportunities with prescription drug coupon websites/apps. MedImpact works with virtually all of them. To my knowledge, as of 2021, MedImpact is a PBM which helps to power many of the coupon-generating websites/apps. Which explains why the discounts with different coupon-generating websites/app are often about the same with many of them for the same drugs.

Anyway, back to Rx coupons. They are curiously enabled by PBM greed and willingness to partner with virtually any revenue stream willing to do business with them. The PBM's are literally proverbial whores — they'll do it with anyone, for a price. 

Side note: While Amazon has been cited as a threat to GoodRx's coupon business, the reality is that GoodRx works with Amazon, but is not truly a competitor. In GoodRx's most recent investor call, GoodRx co-founder and co-CEO Trevor Bezdek said:

"Companies have tried to copy our model or try different models, but none have been able to impact our business. Amazon has been trying to grow pharmacy delivery business. We believe they have not been successful. Mail-order prescriptions only make up about 5% of fill count in the U.S. even through COVID, mails remained a small piece of overall volume and is now starting to decrease as COVID eases."

Unlike insurance companies, consumer-facing tech companies such as GoodRx and others like it are a beneficial outcome (thankfully). But the underlying PBM's are still enabling it. But the FTC has a LOT to look into when it comes to PBM's. But I think it is likely to come soon.

Which PBM's "Power" Particular Coupon-Generating Websites/Apps?

SingleCare is currently unique among coupon-generating websites/apps in that it contracts directly with pharmacy chains to negotiate discounted cash prices rather than using a PBM or combo of PBM's. It is managed by Boston-based RxSense. But its unique business model is a win-win model for pharmacy chains and, to a slightly lesser extent, consumers, although the discounts given to the consumer may not be quite as deep as PBM-powered coupon generating websites/apps on some drugs. Still, on less-heavily rebated prescription drugs which have more room for price variability, including CGM sensors, SingleCare may end up offering the best discount coupons. 

For example, if you search on the SingleCare app for "Dexcom G6 Sensor (Guardian Sensor 3)", you will find some decent discount coupons there. Note that when you search using SingleCare app, it tends to default to Freestyle Libre sensors which aren't the same thing, but when you select the "Brand vs. Generic" option, the Dexcom sensor coupons are there. It does not appear to be an issue when using the web, but the key is to beware of what you are searching for and what the app actually delivers (sometimes they are not the same thing). Also, be certain to note the quantity. The default seems to be a quantity of 2, but I believe that means two boxes of three sensors in each box, so be certain to note the correct quantity of right brand of sensors the SingleCare coupon(s) actually apply towards. Its a quirk of using coupon-generating websites/apps to buy diabetes supplies.

BlinkHealth uses the PBM known as MedImpact. As noted, MedImpact is the ONLY stand-alone PBM. 

ScriptSave WellRx also describes itself as "a member of the MedImpact family of companies". 

Still another coupon-generating discount website/app is branded America's Pharmacy which is a discount program also powered by the PBM MedImpact. I have not really found that this one offers  prescription drug prices any lower than the three others, although this one does offer discounts on "authorized generic" insulin varieties which may be useful should another coupon option not be working. Prices are not necessarily any better than rivals, but this is still an option worth keeping in mind.

GoodRx is somewhat unique relative to the other coupon-generating websites/apps in that it uses MedImpact, but it also has non-exclusive contracts with Cigna's Express Scripts, United Healthcare's OptumRx, and Navitus (which is a PBM owned by the nonprofit hospital chain SSM Health & Costco). That unique non-exclusive PBM arrangement enables GoodRx to compare drug prices from different PBM's and choose the one that offers the lowest price. In April, GoodRx acquired a rival coupon website/app known as RxSaver by RetailMeNot from Vericast which is currently still operational but is unclear for how long, and GoodRx has since cut the price of Novo Nordisk's Insulin Aspart by 22% (previously, RxSaver had lower prices on Novo Nordisk Insulin Aspart).

A relative newcomer (as of 2017) to the coupon-generating website/app space is one operated by the drug wholesaler McKesson, which has a small, but relatively new discount card called ScriptHero (through CoverMyMeds, which McKesson acquired in 2017), which is actually powered by internally via CoverMyMeds, as well as the aforementioned website/app 1) SingleCare as well as the PBM-powered website/app 2) ScriptSave (MedImpact). 

ScriptHero could potentially be attractive to independent/community pharmacies, given McKesson's relationship to these types of entities. For instance, if a community pharmacy is able to negotiate the PBM/discount card taking less spread, it could mean that the community pharmacy is neutral (if not superior) compared to a transaction being processed with GoodRx. However, McKesson itself promoting a program (i.e. ScriptHero) to individual consumers is less of a threat relative to McKesson working with the smaller community pharmacies, as the former would be just another discount card in the marketplace trying to attract consumers.

As for patient prices, ScriptHero is (like many of the others) hit-or-miss. But by combing several options, McKesson hopes to provide a more comprehensive Rx  coupon-generating website/app. Some generic drugs are priced well with this option, plus it also offers discounts on insulin which may not be the lowest prices available anywhere, but they are also not terrible, either. For patrons of small, community pharmacies, this may be a good way of continuing to patronize those businesses while also getting discounted prices on certain medicines. As with the others, the best option is to check them all and determine which one(s) offer the prices you are willing to pay.

PBM Operated Coupon-Generating Websites/Apps

To the best of my knowledge, most of the other coupon-generating websites/apps are operated by insurance company-owned PBM's. One suggestion is to use them if and when they can get you the cheapest price, otherwise ignore them.

OptumPerks is operated by the United Healthcare Group's PBM known as OptumRx, which also operates the Rx discount card. OptumPerks is basically a rebranded version of what was previously known as SearchRx (which the company acquired, SearchRx no longer exists as its own brand/app).  OptumPerks has never delivered the lowest prices for any medicines my family uses, but it's certainly worth checking out. 

Like its rival at UHC's OptumRx, Cigna's Express Scripts PBM unit also operates a coupon-generating website/app called InsideRx InsideRx had its origins as a program offered in combination of Express Scripts and GoodRx originally (see the 2017 press release HERE), but Express Scripts opted to develop its own coupon website/app. The program initially focused on a limited number of brand-name drugs, and has since evolved to offer a much wider number of drugs including generics. The prices on generic drugs, in particular, appear to make this one worth considering. While Cigna-Express Scripts' InsideRx website/app doesn't allow users to sort by price, making it kind of cumbersome to use, plus there are different entries in its system for both branded and generic drugs, meaning you must conduct a search twice to discover the lowest price, it is still one to be aware of. 

It is perhaps no irony that the InsideRx website/app offered by Cigna's Express Scripts PBM unit quite often (sometimes quite drastically) offers the lowest prices on certain drugs if consumer buy uses the InsideRx coupons at Express Scripts Mail Order Pharmacy, especially on certain small molecule generic medications (such as pills) and occasionally on preferred formulary brands of blood glucose test strips (which is apparently Roche AccuChek right now).


For example, my spouse had eye surgery and uses a steroid eye drop called Prednisolone Acetate 1% (brand name: Pred Forte). There, I found InsideRx and Express Scripts mail order pharmacy had the lowest price at $15.39 for a tiny bottle (5 ml in size) of eye drops. By comparison, competing pharmacies (using coupon-generating websites/apps) all had prices ranging from around $23/bottle to a stunning $173.74/bottle. Keep in mind that the size of these bottles is just 5 ml. I can't imagine paying nearly $174 for that! 

Something else we examined was the price of a hypertension medicine called eplerenone 50 mg tablets (which is a generic drug), yet our insurance was charging $48.40 even after satisfying the deductible for a 30 day supply which seemed very high for a generic pill. Initially, we used a coupon from InsideRx, which resulted in savings of $10.00. That enabled us to buy it with the existing refills we already had at the pharmacy, only getting a discount. However, Express Scripts Mail Order pharmacy's price for the same generic drug was just $8.72! That was easily the least costly option we've found on that drug anywhere! So even while our insurance company is contracted with CVS Caremark to offer pharmacy benefits, we found it advantageous to bypass them and buy the drug from Express Scripts mail order pharmacy, even though Express Scripts is not the PBM our insurance plan uses. Pretty nuts!

Still, it does say "At this time, Express Scripts is unable to accept mailed-in prescriptions" which means that in order fatten Express Scripts' own bottom line, the company currently only accepts e-scripts (not paper scripts) from your doctor. First-time orders are likely to sit in queue without a payment method on file. So it does say that consumers may call "For help with your prescriptions filled through the Express Scripts Pharmacy or your online account, you can call us at 1-844-604-9164. Our support team is available 8:00 AM - 9:00 PM ET." That could be a hassle for doctors offices that aren't equipped to handle escripts.

This does appear that since Express Scripts lost all of its PBM clients and was forced to sell itself to Cigna at bargain-basement prices, perhaps a new direction for Express Scripts is a direct-to-consumer model? Given the apparent improprieties associated with generic drug pricing unveiled by the Connecticut Attorney General (whose cases were enjoined by the AG's for 50 other states/territories including Puerto Rico), anything is possible, but it appears Express Scripts might be helping consumers (and their pets!) navigate through some of that. Who knows.

For consumers, lowest price is usually the best place to buy most prescription drugs unless they need to receive it immediately at a pharmacy for an acute illness. Rivals United Healthcare Group's OptumRx card known as OptumPerks and Caremark (owned by CVS Health) seem to be less aggressively promoting the use of their own mail order pharmacies compared to Express Scripts.

On the coupon-generating websites/apps operated by the PBM's themselves, personally, I've generally been underwhelmed by the discounts offered via insurance company PBM-owned coupon websites/apps on everything except generic drugs; the discounts offered just have not been that great in my experience, and many drugs or medical devices are excluded completely.  Still, they are important, because you never know if they will offer the lowest price.

Another coupon-program is from CVS Health and Novo Nordisk which introduced a program they call Reduced Rx, a program that provides some insulin products at lower cash prices to uninsured patients. Reduced Rx is similar to Inside Rx in that both operate as a PBM-backed discount program that passes rebates directly to patients at the point of sale. Reduced Rx includes only three old-school Novolin products.

GoodRx: A Winner for Consumers

Of all of them, I have consistently found GoodRx to be the one app I return to over and over for prescription drug discounts when I don't enjoy coverage from insurance (pre-deductible). It has coupons for insulin of many varieties. In fact, it has even started to offer coupons directly from drug manufacturers if it has no discounts available, meaning it will refer patients to one of Sanofi's coupon pages enabling them to get coupons for Lantus, Apidra or Admelog or the company's highly-concentrated insulin varieties (such as Toujeo, which is U-300 insulin glargine [basically 3x as much insulin per unit]). GoodRx also has coupons for test strips (the discounts exist, but aren't necessarily enormous, but anything helps).

Beware of how I blogged about using generic strips made by different manufacturers that work in the old-school OneTouch Ultra meter, catch my post HERE), plus it some coupon websites/apps offer coupons on CGM's (as my previous blog post noted, right now Abbott's Freestyle Libre has the biggest coupons because the company is trying to establish itself against Dexcom, so its cutting sensor prices to do so). Some coupon-generating websites/apps have coupons on Dexcom sensors and transmitters, although some have discovered that the discounts seem to be better on SingleCare for Dexcom sensors. Recall that SingleCare contracts directly with major pharmacy chains to negotiate discounted cash prices, so it's a slightly different discount model. On SingleCare, a search under "Dexcom G6 Sensor (Guardian Sensor 3)" and coupons come up. Note the number of sensors is important to be aware of; apparently some pharmacies will sell you a single sensor as opposed to a box of three sensors). Also, CGM sensors tend not to be very heavily-rebated via PBM's (at least not presently), which means SingleCare is well-positioned to offer deeper discounts on those sold at pharmacy chains, whereas on drugs, the discounts may not be as generous.

As I hinted, I've generally been underwhelmed by insurance company PBM-owned coupon apps; the discounts aren't that great and many drugs or medical devices are omitted completely. As noted, InsideRx doesn't even allow the user to sort by price, making it more cumbersome to use, plus entries are different for brand-name and generic medicines. PBM coupon app discounts using PBM-operated coupon websites/apps on insulins do not exist, even while the PBM's are collecting manufacturer rebates of 74%.

The lesson for consumers is: Try searching each coupon-generating website/app, and search under both brand-name and generic drug names and at a pharmacy located near you. Prices can vary from pharmacy to pharmacy, but not always. 

Each website/app has different search functionality, some are good, some are not-so-good. But one never knows which might deliver the best prescription drug discounts. If you are bypassing insurance while satisfying deductibles, heavily-rebated drugs like insulin are best bought (if insurance doesn't cover it pre-deductible) with GoodRx coupons on authorized generic rapid acting insulin analogues. The discounts are roughly 75% off the bogus cash retail price. Coupons are not as good on basal insulins such as Lantus or Novo Nordisk's latest "Lantus killer" products. There, the Sanofi coupons which reduce the cost to $99/vial which seems to be the least costly option (at least until there are a host of different biosimilar knockoffs).

Currently the interchangeable Lantus biosimilar known as Semglee from Viatris/Biocon is actually more expensive (GoodRx reports the lowest list price as $105.47/vial) than brand-name Lantus is with manufacturer coupons (priced at $99.00/vial with a coupon from Sanofi), so beware biosimilar does not always mean less costly to patients. The same is true with Admelog, which is an insulin lispro biosimilar of Lilly Humalog/Insulin Lispro which is made by Sanofi (soon to be EuroAPI). There, you can pay either $99/vial for Admelog with a coupon from Sanofi, or $58.38/vial for Lilly Insulin Lispro with a GoodRx coupon. I vote for Lilly Insulin Lispro which costs about half of what the biosimilar costs. 

The following image was taken from Lilly's Q2 2021 earnings presentation made to investors. Note that while overall Humalog sales have essentially been flat (the chart on the right side), most of the recent sales growth has been due to the less costly authorized generic called Lilly Insulin Lispro. That was quite a stunning development which proves unequivocally how much prescription drug rebates paid to PBM's owned by commercial healthcare insurance companies have impacted the market. Regardless, consumers should use the tools available so they can navigate a dysfunctional pharmaceutical most market effectively.

Other items tend not to be discounted as much because those aren't rebated as heavily as insulin is, hence the discounts are generally not as great. But search all websites/apps and make your choices based on which costs you the least amount of cash out-of-pocket. Verify with your pharmacist what they will actually charge you for the products using a coupon; prices can and do change. The key instructions are to: #1) search each coupon-generating website/app using both the brand-name and generic drug names #2) verify both the potency (e.g. the number of mgs in each tablet) and the quantity you plan to buy and finally #3) you may also wish to verify the price offered by different pharmacies for the same drug. Some, such as GoodRx, enable you to sort the findings from lowest price to highest price, but others such as Cigna-Express Scripts' InsideRx do not offer that ability. Occasionally, that has won on lowest price for certain generic drugs when you use their mail order pharmacy, so you never know.

An informative YouTube video released by CNBC addresses the dysfunctional nature of the U.S. prescription drug market, and includes interviews with such experts as Adam Fein of the Drug Channels Institute as well as Doug Hirsch who is a co-founder of the prescription drug discount coupon generating website/app (powered by PBM's) known as GoodRx, and the obligatory "other side" comment from Greg Lopes from the PBM trade organization known as the Pharmaceutical Care Management Association (PCMA) who again, misrepresents the benefits his industry provides. The video can be seen below, or at


Wednesday, August 18, 2021

More Analysts on Wall Street are Starting to Believe Dexcom's Stock is Now Fully Valued

So, on August 18, 2021, the crowd-sourced content service for financial markets known as, which often contains archived investor presentations and earnings transcripts from publicly-held companies, issued not one but TWO (2) slight warnings about Dexcom stock. Links to those two articles are listed below: 


Dexcom was the first mover into the market for continuous glucose monitors (CGMs), at least in the U.S. But Dexcom is hardly the only company operating in the CGM space. Dexcom has also delivered rapid growth, increasing revenue by 43% in 2019.

So far, investors have done well investing in Dexcom. Its stock price has increased by 459% over the last 5 years.  Also over the past 5 years, Dexcom's revenue has grown by an average of 37.5%, and at the end of 2019, the company earned a net profit for the first time. Dexcom management expects the company to grow at a CAGR of 15-20% until 2025 inclusive, and the EBITDA margin target is 30%. But the rate of revenue growth is starting to slow down, so the consensus is that Dexcom management's expectations do not appear very conservative and might be a little on the bullish side. In the opinion of a growing number of analysts, the current targets for Dexcom is optimistic, especially concerning the company's market capitalization. More Wall Street analysts have therefore become neutral on Dexcom rather than optimistic.

A key reason Wall Street is now spooked about Dexcom's share price is due to the company's lofty stock market valuation and looming competitive threats. Dexcom's most competent rival, Abbott which makes the Freestyle Libre system, is arguably only just starting to build a presence in the United States, whereas Dexcom was a bit slower to sell elsewhere in the world where Freestyle Libre is now the undisputed global CGM king. But the U.S. is a tiny part of the global market, and there, Abbott is the undisputed king.

While Dexcom can indeed still expand globally, its challenge is that non-U.S. margins might be lower because it already faces an entrenched competitor in Abbott. Abbott's newer Freestyle Libre model (the Libre 3) which is anticipated to attain FDA approval soon, and the company knows it has no U.S. presence, so it is pricing its products very aggressively, with sensors selling for about 1/3 less than Dexcom's now sell for. Of course, current Libre current models lack some key features many users consider requirements (alarms and sharing capabilities), but the Libre 3 will have all of those things too. Outside the U.S., Dexcom could be forced to do what Abbott is now doing in the U.S.: competing by cutting prices to gain sales, eating into the company's profit margin.

The short story is that Wall Street analysts believe that Dexcom's stock is already fully-valued, hence there's not much room for the company stock to increase in value from where it stands right now. They also believe that some investors who have pushed Dexcom's stock to such lofty levels don't truly understand diabetes or the market for CGM's and are therefore not making completely informed decisions.

Insurers will generally not reimburse CGM's unless people with diabetes are using insulin. That is a reality, and while arguments can be made to expand CGM's to the vast Type 2 market, the reality is CGM's/sensors cost a lot of money and the benefit to payers for Type 2 patients is simply not there unless the patients are using insulin. The reason insurers might cover CGM's for some patients using insulin is that even in people with decades of experience using insulin may find themselves experiencing very dangerous lows and extreme highs, both of which can quickly become fatal. Those can come on with no warning until a person suddenly becomes unconscious.

As my readers already know, CGM's can detect the speedy rise or fall in blood sugars before they cause symptoms, allowing a person to self-treat them accordingly. Since all people with Type 1 diabetes must use insulin, insurers usually cover CGM's for them. This keeps Type 1's from making frequent expensive trips to the ER in ambulances and helps to save the insurers money.

But, as mentioned earlier, people with Type 2 diabetes often can manage their diabetes without insulin by cutting down on the amount of carbohydrates they eat or by taking a host of oral diabetes drugs or use a combination of drugs to treat their diabetes. The drugs are much simpler than insulin for patients to use safely and are far less likely to cause dangerous highs and lows that can put people's lives in danger. Hence, payers really don't see a compelling reason to cover CGM's for Type 2's unless they use insulin.

Dexcom CEO Kevin Sayer recently made a beg (or plea?) for peer-reviewed scientific studies to "prove" that CGM's are a good use of money on the large Type 2 patient audience, but insurers are balking knowing how much it will cost them, and how little economic benefit it will actually deliver to their own bottom lines. 

When asked about coverage for non insulin-using Type 2 patients, Kevin Sayer told MedTechDive journalist Ricky Zipp (see the interview at

"A lot of the pushback is based on cost [to which I respond: 'Gee, you think?']. These patients are very expensive within their own individual health systems, as far as the cost of treating the comorbidities that go along with late-stage Type 2 diabetes in particular. So, adding a sensor cost to that can be questioned. People want to see more evidence. I think we need more clinical studies. It'd be nice if we had reimbursement. But I think just getting the word out and getting more usage is going to be very important too."

However, as one of the SeekingAlpha authors argue, the argument for gaining widespread coverage for non insulin using Type 2 patients really is not there with commercial healthcare insurance company payers. 

Still, both Dexcom and Abbott are each spending big bucks on expensive TV advertising promoting the benefits primarily to the Type 2 universe with ads. This year, Dexcom featured a super-expensive Super Bowl ad featuring Nick Jonas which generated some controversy (see Esquire's coverage of that at

So, that explains what's happening with the costly advertising push from both Dexcom and Abbott. Their ad messages are clearly geared towards the Type 2 universe, rather than the Type 1 universe. Type 1's are considered by both companies as an existing revenue source (although for Abbott, given its non-existent market presence in the U.S., the Type 1 market is a "conversion opportunity", but it has a lot of work to do, and the company may be waiting until it can introduce Libre 3 in the U.S. market). They don't need to be pulled-in on the product value proposition. However, Abbott remains a virtual unknown. It would seem to need more help in persuading Type 1's that its products are even useful, and the current ads are more about telling people with Type 2 about the impact that food has on their blood sugar numbers than how its product compares to Dexcom. 

But insurance company payers say Type 2 patients can get the exact same information with old-fashioned fingerstick tests, which costs them about $30 vs $300. Good luck with that, Dexcom! I don't see it happening with its current strategy.

When one realizes that the ads do not really even target Type 1's, but Type 2's, then the advertiser intent...and the advertising messages make marginally more sense. The ads are intended to stimulate a "pull" demand from Type 2 patients to ask for the devices, but if commercial healthcare insurance company payers won't even cover the devices, much of it will be money pissed away. The hard work is persuading insurance companies that the cost is even worth spending on Type 2 patients not using insulin, and there, I think Dexcom and Abbott still haven't done the required work needed to secure coverage for non insulin using Type 2's.

For Abbott, a lower price-point may help the company make inroads.


I also think that Dexcom presumes too much about supposed patient loyalty to its products. Dexcom sensors are expensive (although truth be told, Dexcom now says that 80% of patients on commercial healthcare insurance are now covered, see it in the company's recent investor transcript at for details). As for customer service, the reviews are mixed, but aren't overwhelmingly positive, although it is a difficult job to do well at. But even with that coverage, I have my doubts. 

At this year's ADA Scientific Sessions, Abbott was bragging about how it's product is priced (in the U.S.) about "a third of the cost of other CGM's" (see the quote at, which is a very big deal for a consumer struggling with a high-deductible insurance plan who is essentially paying for the products out-of-pocket until they satisfy their deductible. 

That may explain why Dexcom is working so hard to make it easier for patients to get their product covered even before the truly competitive rival Abbott Freestyle Libre 3 model hits the U.S. market, likely in 2022. If only Lilly and Novo Nordisk had bothered doing the same for insulin a number of years ago, we would not have 25% of patients rationing insulin today.

In any event, both companies have their work cut out for them. At least one major investment bank, Credit Suisse, seems to believe that the market is likely to shift in favor of Abbott. For example, at this year's ADA Scientific Sessions, Abbott's Libre compared very favorably with Dexcom in terms of HbA1c reductions and acute diabetes complications, they are also bullish on the company's collaboration with Bigfoot Biomedical, and the thinking is that the company's lower price-point might better enable it to persuade payer coverage for non insulin using Type 2's compared to Dexcom, whose product is more expensive.

Watch this competitive space, because the competition is just beginning!