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 https://www.irs.gov/newsroom/irs-expands-list-of-preventive-care-for-hsa-participants-to-include-certain-care-for-chronic-conditions. Details are outlined in Notice 2019-45 (see https://www.irs.gov/pub/irs-drop/n-19-45.pdf 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 https://findahealthcenter.hrsa.gov/. 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 https://www.hrsa.gov/opa/. 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 https://prn.to/2Ug7AHS 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 https://mwne.ws/2P7BpbX 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 https://bit.ly/2KnQTtr 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 https://www.admelog.com/savings 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 https://khn.org/ODc5NTIz 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 https://nyti.ms/2Ts28QK 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 https://republicans-oversight.house.gov/wp-content/uploads/2019/04/Pharma-Letters.pdf 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 http://blog.sstrumello.com/2007/01/business-of-diabetes-real-story-behind.html) 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 https://diabetescaucus-degette.house.gov/insulin-pricing/ with the actual report found at https://diabetescaucus-degette.house.gov/sites/diabetescaucus.house.gov/files/Congressional%20Diabetes%20Caucus%20Insulin%20Inquiry%20Whitepaper%20FINAL%20VERSION.pdf.

DiabetesMine first addressed my idea at https://www.healthline.com/diabetesmine/insulin-pricing-meeting-2016 and its worth re-visiting.  The Diabetes Patient Advocacy Coalition (DPAC) has coverage of the report at http://diabetespac.org/report-on-insulin/ while T1D Exchange (the folks who run Glu https://myglu.org/) have also chimed in on the topic https://myglu.org/articles/how-all-payer-healthcare-might-bring-down-the-price-of-insulin 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 https://www.healthcare.gov/coverage/preventive-care-benefits/ 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 http://blog.sstrumello.com/2007/01/business-of-diabetes-real-story-behind.html 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 http://blog.sstrumello.com/2016/11/changes-in-price-of-insulin-in-graphics.html 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 https://nyti.ms/2H89R0L for the news) and Aetna will do the same (see https://bit.ly/2HgX7tj 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 https://nyti.ms/2FrhLSe for the news on that), whereas Anthem is in the process of starting its own PBM which will start operations next year (see https://bit.ly/2oZjPe7 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 http://reut.rs/1nbk2nP 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 https://prn.to/2HfAMw8 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  https://www.businesswire.com/news/home/20170720005270/en/Merck-Announces-U.S.-FDA-Grants-Tentative-Approval 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 https://seekingalpha.com/article/4141906-eli-lillys-lly-ceo-david-ricks-q4-2017-results-earnings-call-transcript 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 https://www.prnewswire.com/news-releases/mylan-and-biocon-receive-approvals-from-the-european-commission-and-tga-australia-for-semglee-biosimilar-insulin-glargine-300620737.html 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 http://blog.sstrumello.com/2015/01/2014-observations-in-type-1-diabetes.html 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 http://diabetespac.org/dpac-statement-non-medical-switching/ and http://www.keepmyrx.org/issues/non-medical-switching/ 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.

Thursday, August 17, 2017

A (Belated) Tribute to David Mendosa

I still have some trouble coming to grips with the fact that on May 8, 2017, the Diabetes Community (D-OC) lost one of the Diabetes Online Community's true pioneers and I'd say founders: David Mendosa (http://www.mendosa.com/ -- for the time being, anyway).  David passed away following a diagnosis of angiosarcoma in the liver -- which is evidently a type of cancer.  I think the fact that he passed away from something other than diabetes or its complications is a true testament to David's belief of living life to the fullest in spite of diabetes, which need not impede anyone, in spite of being dealt a pretty lousy hand in the proverbial card game of life.  He would have been proud that if something led to his death, it definitely was not diabetes.

David was out there online long before there even was a D-OC, and his wisdom and courage arguably paved the way for what has become a thriving virtual community of people with diabetes online, which is not limited to the U.S., but now has communities worldwide.  In the very early days of his ventures online, some of us knew him as "Rick" Mendosa, which was a name he used professionally when he first started writing about the formerly-taboo topic of diabetes, which was expected to be kept in the proverbial closet and not mentioned in public.  David changed all that, and he also legally changed his name to David in 2005.  I was fortunate enough to have met David several times over the years, and it was really an honor just to meet the man who paved the way for the D-OC before it even existed.  When he began, he was still living in California and he acknowledged that while he loved the climate in California, he later relocated to Boulder, Colorado in 2004, which he was quite fond of in part, because it was a college town with very open-minded people.

David had Type 2 diabetes, but he was a true reporter and dealt with only the facts, not the misinformation, rumors and innuendo about diabetes that was so prevalent online before him.  His accuracy and focus on diabetes of all varieties is something I really appreciated.  He also chronicled his experience with the very first FDA-approved GLP-1 inhibitor (Byetta) which he acknowledged did help him to lose a few pounds (but he was the first to acknowledge that it was not attributed solely to that, he and his efforts were a much bigger part of that, only that it helped out) whereas other Type 2 treatments actually inhibited weight management, and too many still do.

David was also a fan of low-carb solutions, which he felt made his life with diabetes (and many others) vastly easier, as he was fond of acknowledging that big insulin dosages can also lead to really big screw-ups, not to mention unwanted weight gain.  He was also quite candid about aging and the challenges that brought, but also the joys that brought, too.  Oh, and he was a fan of photography, too.

But there was far more to David than all of that, and above all else, he made a point of noting that no one solution is appropriate for everyone who lives with diabetes.  Finally, he was, like me, a fan of the science and facts, which I tried to build my own blog upon, and along with it, a formal acknowledgement that diabetes is an industry like others, which must be acknowledged for its plusses and minuses.  That also led me to the conclusion that regulators have a very big part to play in what treatment options are available, and that patients deserve a very big role in how that plays out.  But today, thanks to David's contribution, there's an acknowledgement that diabetes is first and foremost, a business, and diabetes has a well-deserved reputation as a growth industry. David was also the first to acknowledge that hucksters are targeting people with diabetes more and more with their scams and schemes, but I think because of him, there's now a perception that like all businesses, there are those which are ethical, and those which are not.  Sometimes it's a grey area, so caveat emptor.

I owe a great deal to David, and I like to think that I have kept my part of the bargain that David instilled in me, and hopefully added to the the role that we play in not only our personal health, but also that we can play an important role with regulators, too, even if they would prefer not to deal with us because it makes their jobs tougher to do!

That's not our problem, it's our obligation.  Please do not forget it!  David, thank you for your role in creation of the diabetes online community we know as of 2017.  You helped lay the cornerstone for this community, and you will be missed but not forgotten!

Friday, January 13, 2017

How Patient Advocacy Helped Persuade Medicare to Cover Dexcom

This week, there was some very good news from the Centers for Medicare & Medicaid Services (CMS) and the JDRF, notably for people with Type 1 diabetes who rely on Dexcom CGM devices.  Essentially, CMS has accepted FDA labeling for the system and will no longer prohibit coverage.

JDRF did a press release which can be seen at http://www.prnewswire.com/news-releases/jdrf-encouraged-by-medicare-decision-to-take-first-step-toward-coverage-of-continuous-glucose-monitors-for-people-with-type-1-diabetes-300390684.html.

Dexcom had its own release which can be seen at http://www.businesswire.com/news/home/20170112006146/en/Centers-Medicare-Medicaid-Services-CMS-Classify-Therapeutic.

This really began last year when Dexcom submitted a supplemental application to its existing FDA premarket approval to add a new indication for use of the Dexcom G5 Continuous Glucose Monitoring System, asking that it be officially approved for making insulin dosage decisions.

Previously, the Dexcom G5 was only approved to measure glucose in interstitial fluid as an adjunctive device meant to complement, but not replace, the information obtained from more traditional fingerstick blood glucose monitoring devices.  According to an FDA briefing document (see https://www.fda.gov/downloads/AdvisoryCommittees/CommitteesMeetingMaterials/MedicalDevices/MedicalDevicesAdvisoryCommittee/ClinicalChemistryandClinicalToxicologyDevicesPanel/UCM511810.pdf for more detail), the level of accuracy of the Dexcom G5 mobile continuous glucose monitoring (CGM) system is "close to, but not as good as, typical self-monitoring blood glucose meters in the U.S. market."

I agree with the FDA briefing document and won't use my Dexcom for dosing decisions, but some do and they find the trending info. CGM's provide to help in their decision-making.  But the Dexcom application request raised some questions as to whether the FDA would even agree to re-label the device.  At a hearing held on on Friday, July 22 2016, the FDA's clinical chemistry and clinical toxicology advisory panel voted 8 to 2 in favor of safety, 9 to 1 for efficacy, and 8 to 2 that the benefits (see http://www.prnewswire.com/news-releases/fda-advisory-committee-votes-in-favor-of-non-adjunctive-label-for-dexcom-g5-mobile-cgm-system-300302609.html for more detail) of the proposed new label indication would outweigh the risks.  Although the FDA is not bound by its advisory panels' votes, it often heeds their advice in making its decisions.

There was some patient activism involved in helping to persuade the FDA to re-label the device.  For example, in early July 2016, the diaTribe Foundation (see https://diatribe.org/sign-diatribes-letter-fda-supporting-use-cgm-insulin-dosing for the recommended letter text) began seeking signers for a letter it had drafted in support of the new indication Dexcom was seeking, and it aimed to get at least 1,000 signers to the letter (apparently, their letter was signed by over 10,000 people with diabetes and their families, see http://ow.ly/M69L3085eZb for more).  There were also advocacy efforts by the Diabetes Hands Foundation, Diabetes Daily, Diabetes Patient Advocacy Coalition (DPAC), the JDRF and others (Insulin Pumpers, for example).  Personally, I liked the diaTribe Foundation's letter, and I used that as the basis for my own comments on why I felt the new label indication was appropriate when I submitted my own comments to what was then an open-docket at FDA.  But, I think what was unique (and encouraging) about all of the efforts was the degree of spontaneous organization and collaboration amongst all the parties involved.  Instead of contradictions and bickering, most of the initiatives built upon the efforts of one another.

Just before Christmas 2016, we got a decision.  FDA agreed to expand the approved use of Dexcom's G5 Continuous Glucose Monitoring System to allow for replacement of fingerstick blood glucose (sugar) testing for diabetes treatment (insulin dosage) decisions in people 2 years of age and older with diabetes (see the press release at http://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm534056.htm for details).  This was definitely something many patients with diabetes wanted to see happen, although maybe not for the reason of avoiding a fingerstick as some writers erroneously presume.  Rather, it's the implication the decision might have on securing Medicare coverage of the Dexcom G5 system.  Of course, an FDA label is one thing, but getting Medicare to cover these devices was an entirely different matter.  Medicare is huge, but is frequently difficult to work with and is sometimes unpredictable.

This week, the Centers for Medicare & Medicaid Services (CMS) re-classified therapeutic Continuous Glucose Monitors (CGM) as "Durable Medical Equipment" under Medicare Part B, which means that for some patients with diabetes who are on Medicare, they actually might be able to get coverage now.  It's not a blanket decision, but the direction seems clear.  Also, many insurance companies base coverage decisions based upon what Medicare does, so this might help some gain coverage with private insurance, too.

Here's the CMS link to the coverage details:  https://www.cms.gov/Regulations-and-Guidance/Guidance/Rulings/CMS-Rulings-Items/CMS1682R.html.

A downloadable document link to the full CMS Ruling No. CMS-1682-R can be found at https://www.cms.gov/Regulations-and-Guidance/Guidance/Rulings/Downloads/CMS1682R.pdf.

Wednesday, November 02, 2016

Changes in the Price of Insulin, In Graphics!

In September 2016, the media was flooded with stories about the rediculously expensive price of EpiPens, which is basically epinephrine used to treat severe allergies (such as when some people get stung by bees or encounter peanuts), as the pens cost more than $600 for a package of two.  The news was that the price of EpiPens had skyrocketed, which is a generic drug with an innovative delivery device that enables even people unfamiliar with doing so to give an epinephrine injection in order to rapidly address allergic reactions.  Prices for the devices had increased by 600% over the past decade.  Suddenly, everyone was remarkably empathetic to the persons who need to pay more than $300 for an EpiPen.  But as I already noted in my preceding post (see https://goo.gl/cWvNRz for my post), that incident was remarkably familiar to people who have to buy insulin, glucagon and supplies needed to manage diabetes.

I pointed to a Bloomberg article (see http://www.bloomberg.com/news/articles/2015-05-06/diabetes-drugs-compete-with-prices-that-rise-in-lockstep for that) which showed a sickeningly similar trend of dramatic price increases for insulin (especially) and other diabetes-care items.  The Washington Post finally addressed this issue with an article of their own (see https://www.washingtonpost.com/news/wonk/wp/2016/10/31/why-insulin-prices-have-kept-rising-for-95-years/ for the article), so did the Wall Street Journal (see http://www.wsj.com/articles/insulin-prices-soar-while-drugmakers-share-stays-flat-1475876764 for the article), and NBC News did so today (see http://www.nbcnews.com/business/consumer/insulin-new-epipen-families-facing-sticker-shock-over-400-percent-n667536 for the article).  [Finally, Business Insider covered the story on May 15, 2017, see their article at http://www.businessinsider.com/insulin-prices-increased-in-2017-2017-5 for more detail.]  One of the articles noted that one version of insulin carried a list price of $17 a vial in 1997 is now priced at $138 today. Another that launched two decades ago with a sticker price of $21 a vial has been increased to $255.

Since I've seen some stunning charts and graphs in these articles, I thought it might be worth sharing the story ... graphically.  The images below are courtesy of Bloomberg and The Washington Post, the WSJ and NBC News, but paint a graphic picture of what's become of the insulin market in recent years.  The trends are even more stunning with these graphics!  Note that if you click on many of the charts, that will take you to the original articles.

On April 8, 2016, NPR's Science Friday covered the rising prices of insulin in a segment entitled "Diabetes Drug Prices Tripled in a Decade" (listen below, or by visiting http://bit.ly/2mlI95Z for the story).

Obviously, the trend from biosynthetic "human" insulin to patent-protected insulin analogs was part of story, but those patents are all expiring.  The biggest-selling basal insulin known as Lantus (U-100 insulin glargine rDNA origin) will see the first knock-offs being launched by the end of 2016, and CVS has already pulled Sanofi's costly basal insulin from next year's formularies.  Although I hadn't anticipated biosimilars coming from other big pharma players, the fact is that pharmacy benefits managers including CVS, Express Scripts and United Healthcare's own OptumRx unit (which bought Catamaran in March 2015, see the news at http://www.wsj.com/articles/unitedhealth-to-buy-catamaran-for-12-8-billion-in-cash-1427709601 for more) are now pushing for lower prices, and getting them.  This has hurt players like Novo Nordisk very badly.  The only problem is that the lower prices they're getting come from rebates, so the discounts are invisible, meaning they're done without any changes to list prices for insulin.

That's good for big payers, but not so good for the rest of the market.

American Public Media's Marketplace had a great radio segment dedicated to this topic.  See below, or visit http://www.marketplace.org/2017/01/31/world/drug-makers-insulin-accused-price-fixing:

At least one law firm is seeking to have its case against the big 3 insulin makers classified as a class action, and if that happens any insulin user can be a part of the class, so stay tuned for more.

Friday, September 30, 2016

Novo's Ills Are Indicative of Something Other Than A Free Market for Insulin

As I've already addressed, a few weeks ago (see my post at http://blog.sstrumello.com/2016/08/the-business-of-diabetes-cvs-caremarks_5.html for more), Novo Nordisk's CEO Lars Rebien Sorensen rather unceremoniously announced he was retiring early (see http://fortune.com/2016/09/01/novo-nordisk-ceo-retire-insulin/ for more) which was kind of an acknowledgement that the era of easy price increases for its products in the U.S. is over.  Already, CVS Caremark and United Health announced that they are dropping Sanofi's Lantus in favor of biosimilar versions from Lilly/Boehringer or Merck/Samsung, and there's reason to presume that biosimilars will pressure Novo's products even more.  This week, Novo also announced it was taking the very rare step of laying off approximately 1,000 employees, something the Danish company has almost never done, including about 500 people in its R&D department.

When a reporter asked him if that meant the company was cutting into the bone of the company, rather than the fat, the response he gave was rather interesting:

"The next line of products have to have an even greater height of innovation, which means those that do not have that height of innovation will have to be culled," Soerensen said. "Otherwise, it's going to be difficult for us to get reimbursement for our drugs. Me-too or me-better drugs will not be good enough in the future and hence we need to prioritize."

That kind of sounds like an acknowledgement (to me, anyway) that some of its newer products, most notably Tresiba (U-100 insulin degludec rDNA origin) is acknowledged even by the current leadership to be a "me-better" product, rather than anything really truly innovative.

Indeed, Jeremy Greene, an associate professor at the Johns Hopkins University School of Medicine said "If any drug should be available generically, it should be insulin." adding the new insulins are "not so much better that it justifies the presence of people who can't afford any drug."

In August, the $#!t hit the fan over EpiPen price increases.  In effect, the price of the EpiPen, which treats emergency allergic reactions and things like bee stings, but is not really a drug that must be taken daily, had climbed sixfold over the last several years. At drug price-comparison website GoodRx, the cheapest price at the time was $614 for a package containing two, or more than $300 per EpiPen, up from about $100 for two EpiPens not too long ago.

The story was an all-too-familiar one: a company buys an old drug that no one else makes anymore, raises prices and impedes patient access to life-saving treatment in the process.  We saw a similar situation when "Pharma Bro" Martin Shkreli made news a few weeks earlier.  As the then-CEO of Turing Pharmaceuticals, he acquired an old anti-parasite medication called Daraprim and immediately increased the price from roughly $13.50 to $750.  He seemed to relish in giving his middle finger to people impacted by the decision.

In the case of the EpiPen, the target of that tired narrative was a medical device with an unusual amount of brand name recognition, no real alternatives and a growing patient population — Mylan Inc.'s EpiPen.  Epinephrine is a generic medicine, and is widely available but the delivery device (in this case, a pen) was unique and made it easy for people who aren't medical professionals to administer.

People with diabetes kind of looked at all the news and thought to ourselves "So what? Welcome to the club, EpiPen folks ... have you seen the insane prices of insulin lately?"  Of course, we didn't have much data to back it up, and since most people really have no clue what the real prices are for medicines we rely on, its a pretty tough claim to substantiate.

But earlier this year, Bloomberg had an interesting article entitled "Hot Drugs Show Sharp Price Hikes in Shadow Market" [http://www.bloomberg.com/news/articles/2015-05-06/diabetes-drugs-compete-with-prices-that-rise-in-lockstep] which interestingly enough, looked at insulin prices.

On May 30, 2015, the price for a vial of the blockbuster diabetes medication Lantus (U-100 insulin glargine rDNA origin) went up by 16.1%. On the very next day, Lantus's only direct competitor, Levemir (U-100 insulin detemir rDNA origin), also registered a price increase -- of precisely 16.1%.

The pattern repeated itself six months later when Lantus, from French drugmaker Sanofi, was marked up 11.9% percent, and Levemir, made by Novo Nordisk A/S, matched the price increase again exactly.

Clearly, this is not how competitive, free markets are supposed to work.

I should acknowledge that insulin was definitely not the only type of medicine to exhibit this type of price inflation.  But it is indicative of a market that is definitely not a competitive one, not exactly a free market.

Some of this comes directly from Bloomberg, but its worth sharing with the diabetes community.

Is this price-matching a coincidence?  I think not.

Bloomberg's analysis revealed that in 13 instances since 2009, prices of Lantus and Levemir -- which dominate the global market for basal insulin with approximately $11 billion in combined sales -- had gone up in tandem in the U.S., according to SSR.

The article also discusses the shady world of "shadow pricing", and rebates given to big payers and how prices outside the United States, which arguably subsidizes the rest of the world with the prices paid.  Ironically, the drug and biotech industry lobbied very hard to prevent one of the biggest payers in existence, Medicare, from negotiating drug prices under the Medicare drug benefit signed into law by President George W. Bush.  Most other countries have price controls, or at least are able to negotiate based on how much they are buying.

For example, in Germany, almost every German belongs to one of some 160 nonprofit "sickness funds," or nonprofit insurance collectives. The sickness funds cover both medical visits and prescription drugs. Drug prices there are already lower than in the U.S. because sickness funds negotiate with both physician groups and drug manufacturers to set costs of all treatments across the board. But in the U.S., Medicare isn't even allowed to negotiate lower drug prices.

As for prices, Sanofi and Novo "are taking the same price increase down to the decimal point within a few days of each other," said Richard Evans, an analyst with SSR. "That is pretty much a clear signal that your competitor doesn't intend to price-compete with you."

A pattern of insulin makers matching each others price increases “certainly indicates a market that isn’t competitively healthy,” said David Balto, an antitrust lawyer and former Federal Trade Commission policy director. However, if two companies act independently to follow each other’s price increases, it’s not an antitrust violation, he said.

But Lilly, which once dominated the U.S. insulin market with an estimated market share of 85% for insulin sold in the U.S. back in 1985, basically ignored the diabetes business as it pursued neuroscience with drugs like Prozac and Zyprexa.  Lilly had to partner with the German drug company Boehringer Ingelheim for most of its newer diabetes medicines, but since bringing in Enrique A. Conterno to run the diabetes business a few years ago, has suddenly started appearing on more drug formularies than it has in years.  But Lilly's willingness to compete on price, at least with some big payers like United Healthcare and Kaiser Permanente, doesn't mean retail prices are likely to show any decreases.

For their part, drug manufacturers like to keep prices as secret as possible.

"How much a patient pays is based on a negotiation between the payer and the pharmacy," said Ken Inchausti, a Novo Nordisk spokesman. He said the company couldn't comment fully without knowing details of a patient's health plan.

Have a look at this video (see below, or by visting http://bloom.bg/1IjpdgL for the link).

Author P.S., October 8, 2016:  The Wall Street Journal acknowledged big price increases for insulin but seems to lay responsibility for the increases on drug wholesalers like McKesson and AmerisourceBergen for the price increases, not the manufacturers who offer PBMs big "rebates" which reduces the end prices paid for by insurance companies.  For details, refer to the article at: "Insulin Prices Soar While Drugmakers' Share Stays Flat" http://on.wsj.com/2dl1znP

Sunday, August 21, 2016

A Tribute to Kathy Putzier

It seems like these days, half of my posts are tributes (actually, its true, though I have a few others mixed in), and today, unfortunately, will be another one.  This one is for Kathy Putzier.  Her sister Joan Meece shared the news on Facebook on Wednesday, August 17, 2016, so I presume the actual date was sometime around that, although details are still trickling in right now.

One irony, which I think perhaps Kathy would have appreciated, is the fact that another person also named Kathy Putzier who was also from the Twin Cities area passed away around the same time, although the other Kathy was 82 years old, so it definitely wasn't the same woman that the diabetes community knew and loved, as the Kathy Putzier we knew was just 63 years old.

Early d-bloggers knew Kathy first as "Minnesota Nice" (not a bad term based on my knowing her!) and her blog was known as "Purple Haze" (see http://kathy4762.blogspot.com/ for her archived posts).  In 2012, Kathy decided to devote her time to other pursuits, so she decided to stop blogging, although I believe she remained pretty active on TuDiabetes, which was the place she decided to continue her online diabetes work.

Like me, Kathy was one of the earlier members of the d-blogging community as a person with Type 1 diabetes, and many in the Minneapolis area including Scott K. Johnson and others had met up her quite a few times.  No doubt, their sense of loss is bigger than mine.  But a few years ago, I went to Minneapolis for a long weekend (I think it was Memorial Day weekend), and Kathy and I were going to try and get together that weekend (I did get to reconnect that weekend with Allison Nimlos during that visit, which was great, but others like Scott Johnson were out-of-town that weekend).  As things sometimes happen, when Kathy and I spoke on the phone, the timing just did not enable us to meet in person during that visit, as she had some family activities going on that weekend, too.

As a result, my memories of Kathy were mainly of her personality expressed online, which I think were a genuine representation of her as a person ("Minnesota Nice" was a good name, based on my phone conversations with her!).  Kathy was also dealing with some kidney problems, although I don't know for certain if that was the cause of death for her, but as someone who was also diagnosed in the so-called "dark ages" of diabetes care a few years before me (she was diagnosed in 1973, I was diagnosed in 1976), so also she saw the evolution -- and in some cases, the de-volution, of diabetes care, just as I have over the years.  We would sometimes reminisce about those days, which as I've blogged in the past, are not quite as terrible as many newcomers to the world of Type 1 diabetes have been taught to believe (catch my post at http://goo.gl/UQRIfK for more details).

Kathy with World Diabetes Day postcard (I think!)

Kathy and some Minneapolis D-friends.

Kathy (second in on the left side) and the Minneapolis D crowd.

Kathy circa 1975. She looked pretty much the same in 2016!
Anyway, this was an event from this week, although I haven't yet found an obituary for Kathy, as details become available, they can be found on TuDiabetes.  Kathy's Facebook page was at https://www.facebook.com/kathy.putzier though if you weren't already Facebook friends with her, I think it might be too late.  Also, a tribute page was created for her on TuDiabetes at http://www.tudiabetes.org/forum/t/share-memories-of-kathy-putzier/55526 which you can check out.

I'm sorry to hear about Kathy's passing, but just as I noted in my post a few weeks ago about Kitty, I know that today, Kathy is now in perfect health and can look down at her vast network of friends here on earth and smile at how many are missing her now.  Kathy, I'm glad to have known you, even if it was mainly online!