Sunday, January 16, 2022

Discerning Hope from Hype Related to Novo Nordisk Glucose-Responsive Insulin

Below is a copy of an investor report (see HERE) on Novo Nordisk from the Wall Street investment bank known as Credit Suisse (the New York-based research business of the Swiss banking giant which mainly serves billionaire clients was formerly known as First Boston). I will discern my take-aways as it pertains to the few notes about Novo Nordisk's much-hyped (by the company itself) glucose-responsive insulin. There is some progress, but it is by no means a done deal.

Novo Nordisk AS Feedback from London Post 3Q 2021 Management Meeting on Scribd

On November 4, 2021, Credit Suisse attended a London sell-side meeting with Novo Nordisk A/S's Karsten Knudsen (CFO), Camilla Sylvest (EVP Commercial Strategy) and Martin Lange (EVP Development). Most of the dialogue was about the company's GLP business (Ozempic, Saxenda, Xultophy [iself a combo drug consisting of Novo's GLP-1 agonist and its basal insulin analogue degludec sold under the brand name Tresiba] and Wegovy -- all of which are New & Improved versions of the company's "original" GLP-1 agonist which was branded as Victoza, and that product was little more than an improved version of the biologic drug branded as Byetta which the old Amylin Pharmaceuticals commercialized before that company's ultimate demise; most of its intellectual property assets were acquired by AstraZeneca, although Lilly kept some developed during its joint venture with Amylin. Today, Lilly sells a new and improved version of its own GLP-1 agonist which is branded as Trulicity) and GLP-1 agonists and derivatives thereof now drive the vast majority of Novo Nordisk's current revenues in the U.S. and outside the U.S.

Insulin has largely become an afterthought to Novo Nordisk when it comes to to the company's bottom line. Still, Novo Nordisk began with insulin and still likes to boast that it's the world's largest insulin manufacturer (mostly because of relentless acquisitions made around the world, largely bankrolled by profits derived in the United States). Indeed, Novo Nordisk told investors that global insulin growth of 2% was still solid and that Novo Nordisk is taking global volume share, although the bottom-line impact of that has been offset by U.S. price declines. Novo Nordisk expects no changes to its insulin business as a result of the continued U.S. pricing pressures it faces. 75% of its U.S. insulin revenues are paid to PBM's to secure commercial healthcare insurance company formulary placement. 

Side-note: currently, there are a growing number of biosimilars of Novo Nordisk's current bestselling prandial insulin analogue, with approximately 4 now in development for Novo Nordisk's insulin aspart alone (including from Viatris/Biocon, Lannett/HEC, and Sandoz/Gan & Lee) which means Novo Nordisk really needs a hit with glucose-responsive insulin, because none of its basal insulin varieties have done very much to improve the company's bottom line.

In spite of the fact that GLP-1's now account for most of Novo Nordisk's revenues, Novo Nordisk is still investing in new insulin varieties. 

Aside from a once-weekly basal insulin Novo Nordisk calls Icodec (which seems to be targeting the massive Type 2 patient audience), another insulin variety the company is finally more seriously investing in glucose-responsive insulin. Novo Nordisk's glucose-responsive insulin is based mainly on technology the company acquired in 2018 when it bought at UK-based university startup called Ziylo. Ziylo's glucose binding molecules are synthetic molecules that were designed by University of Bristol (UK) Professor Anthony Davis. However, it was actually the University of Bristol acquisition which brought Novo Nordisk closer to making it happen, and so far, that seems to be working well, although it is still VERY early in development. So much for the myth that Novo Nordisk is a company which develops everything in-house!

The stable, synthetic molecules developed by the University of Bristol exhibit an unprecedented selectivity to glucose in complex environments such as blood. Still, Novo Nordisk was historically something of a patent troll when it came to glucose-responsive insulin. Over the years, Novo Nordisk has filed dozens of pre-emptive patients which were never really based on science, all in an effort to scare rivals from even pursuing the concept. 

Recall that in July 2021, rival Lilly made headlines of its own when that company acquired a Los Angeles-based startup called Protomer Technologies (see for the news). In November 2020, Lilly had led an equity investment in Protomer alongside the JDRF T1D Fund (Protomer received seed capital from JDRF, but T1D nonprofit is legally independent of JDRF T1D Fund and there is no management overlap; also the JDRF T1D Fund is largely bankrolled by a billionaire father named Sean Doherty and his desire to advance treatments for his T1D son named Finn). All told, Protomer raised $6.6 million seed financing. In July 2021, Lilly subsequently acquired the rest of Protomer that it did not already own. It is unclear how far Lilly's Protomer investment really is, although it is likely not very far behind the Novo Nordisk/Ziylo effort, which has only completed Phase I clinical trials and now must do some work before it goes to Phase II.

Back to Credit Suisse's November 2021 meeting with Novo Nordisk top execs. Novo Nordisk told Credit Suisse that its early Phase I clinical trials of glucose-responsive insulin had demonstrated good proof-of-principle, although the company admitted that the company still needs to refine it further before it can progress. More specifically, the company revealed that its Phase I trial results indicate the company needs to look at PK (Pharmacokinetic) properties before progressing. PK is the study of how the body interacts with administered substances for the entire duration of exposure. But Novo Nordisk reminded investors that PK analysis is not likely to be a major barrier because that's something Novo Nordisk is very good at.

The company also revealed that it would offer more details on its broadening technology platforms at its March 3, 2022 Capital Markets Day ("CMD") to be held in Copenhagen, Denmark. Perhaps more details will be revealed in that event.

There are no guarantees of course, but presuming everything works out as anticipated and there are no unpleasant Phase II or Phase III clinical trial results, this suggests serious development efforts are finally underway. If that happens, we could potentially see glucose-responsive insulin by 2035 because Novo Nordisk needs a hit in insulin (its basal insulin varieties were technologically successful, but none have achieved blockbuster status because they do not serve an unmet need, and now that rival Sanofi Lantus has seen patents expire, the new competitive dynamic is ever-lower prices which Novo Nordisk doesn't want to do). Still, I wouldn't hold my breath waiting for glucose-responsive insulin to happen just yet.

Sunday, December 05, 2021

Novo Nordisk Takes a Hit on China Insulin Price Reductions

Last week, stock prices of two global insulin-manufacturers (Novo Nordisk and Lilly, but Novo Nordisk suffered far more than Lilly did) took a hit on news related to their Chinese operations (see AND for more). Inclusion in China's National Reimbursement Drugs List requires volume-based procurement (VBP) discounts. Chinese sales have enabled a number of drug companies to pump-up their sales growth in recent years, but having to sell the drugs at a discount cuts into their margins. 

According to shareholder disclosures made by Novo Nordisk, last month, China's National Healthcare Security Administration (NHSA) added 67 medicines which are branded drugs with no generic versions available in China including insulins for the very first time. The news hit Novo Nordisk particularly hard. Danish diabetes drugmaker Novo Nordisk A/S disclosed that its sales growth would slow by 3% in 2022 because of lower prices and reduced sales volume specifically in China. Diabetes drug makers agreed last month to cut prices by 48% on average in order to be qualified to bulk supply public hospitals. Rival Lilly, which has a more diversified revenue stream than Novo Nordisk does was also impacted by the China NHSA announcement, just not by as much as Novo Nordisk was. This was the first time NHSA has included insulin on its list.

While the hit to pharma companies' stock prices was short-lived, it is worth acknowledging that Novo Nordisk Fiasp and Tresiba (insulin degludec) were the primary sales hits because no other Novo Nordisk insulin varieties are currently on the NHSA list in China to be hit, and in fact, several of its insulin products have already been copied by Chinese drug manufacturers and are already sold as biosimilars at much lower prices in China. Also, the company's cash-cow (Victoza, as well as several label extensions of that product) are also facing Chinese biosimilars, although only insulin was added to the NHSA list so far.

For example, Novolog (insulin aspart) has been "generic" in China for a few years, and in fact, several Chinese manufacturers are now planning to export versions of aspart to the U.S. as biosimilars to be commercialized by U.S.-based drug company partners. Among them: Lannett Company which plans to sell an aspart biosimilar made by China-based HEC, and Sandoz (which itself is due to be spun-off by parent company Novartis) plans to sell a biosimilar made by China-based Gan & Lee to name two specific examples. Both Lannett and Sandoz had planned to use the cost-savings of making the insulin in China to bribe (I mean rebate) PBM's to secure commercial healthcare insurance company formulary placement in the U.S. They likely still will, but they will likely be selling two versions of their biosimilar products: a rebated version, and an un-rebated version, as Viatris/Biocon recently did with Semglee and Viatris Insulin Glargine (catch my post HERE for more).

Sanofi's diabetes business (or at least what's left of it) itself is in the process of being spun-off as a standalone commodity drug company to be known as EuroAPI, was not impacted at all by the NHSA announcement because none of its diabetes products still enjoy patent-exclusivity protection in China. Its bestselling product is Lantus (and a U-300 version branded as Toujeo) is widely copied by local manufacturers in China.

So, in essence, in November 2021, China took some wind out of Novo Nordisk's sails because the country forced the Danish company to slash prices in China by about 48%. 

No one in the U.S. should be crying for Novo Nordisk. The company has for many years used profits derived from sales in the United States to become a global drug seller. The company endured a much more sustained challenge starting around 2016-2017 when its PBM-rebating problem in the U.S. blew up in its face. It forced the company's CEO to "retire early", something which NEVER happens in Denmark. I blogged about that at the time HERE. In addition to the CEO calling it quits, Novo Nordisk faced shareholder lawsuits, including one which was only settled in 2021, resulting from that debacle.

Sunday, November 21, 2021

Why Biosimilar Makers (incl. Insulin) Must Sell 2 Versions of their Copy-Cat Meds in USA

Recall that Adam Fein, who writes the Drug Channels blog, recently documented (see HERE for details) that Viatris (fka Mylan) and its biotech co-development partner Biocon, recently revealed that in spite of earning the FDA "interchangeable" designation for the insulin biosimilar of Sanofi's Lantus for the product Viatris branded Semglee that they would be using prescription drug rebates needed to bribe, errr ... secure PBM formulary placement. They will offer both a branded and un-branded version ... of a biosimilar. That's weird, but likely suggests what the U.S. biosimilar market will look like in the near future. 

FiercePharma documented the curious necessity for biosimilar makers to sell two versions of their products HERE. The curious necessity for a biosimilar manufacturer to sell two versions of biosimilars which involve little R&D is a peculiarity of the U.S. market. Viatris/Biocon finds it necessary to bribe PBM formulary managers with "rebates" hence it offers a rebated version of the product, and a cheaper, un-rebated version to avoid the PBM rebate trap. In order to get around that not-so-little rebate problem, Viatris will simply introduce a version of Semglee called Viatris Insulin Glargine that avoids the Rx rebate problem. Viatris labels the products "Insulin Glargine-yfgn" which is the search term patients should use on various coupon-generating websites/apps.

Offering two versions of the same product is also precisely what Lilly has done with its "authorized generic" (an FDA term) or "non-branded" version of Humalog called Lilly Insulin Lispro and what Novo Nordisk has done with its "unbranded biologic" version of Novolog called Novo Nordisk Insulin Aspart. The companies have two different NDC numbers for the same products to accommodate rebates necessitated by PBM's (or, put another way, a method to bypass the Rx rebates/bribes paid to PBM's to reduce patient prices).

As Lilly has revealed in its company quarterly investor presentations, Lilly Insulin Lispro has generated sales volume growth for the company and does so without massive rebates to PBM's of 74% or more (if rival Novo Novo Nordisk is being truthful).

Eli Lilly is already trying to work both segments of the diabetes market with its fast-acting insulins, Bernstein analyst Ronny Gal noted to FiercePharma in an e-mail. It's "primarily the high-price/high-rebate product which is selling," Gal added. 

Mr. Gal makes a somewhat questionable assertion, except when one looks at Humalog global sales of the product. The reason I say that is because of Lilly's Q2 2021 quarterly earnings investor presentation given on August 3, 2021. The following slide comes from that presentation: 

Click image to enlarge

According to that in the graph on the right side, since June 2019 (not too long after Lilly Insulin Lispro was introduced across the U.S.), sales of the high-price/high-rebate product branded Humalog have been falling steadily, whereas Lilly Insulin Lispro has made-up the slack. Overall sales of both products have largely been flat. There's little doubt Humalog is still the biggest part of its overall sales, but the impression that the high-price/high-rebate product is the only part generating any sales growth is simply not validated by the evidence. Humalog sales are declining, while sales of Lilly Insulin Lispro are rising.

As Lilly's patents on that blockbuster product expire, we can expect Lilly to shift its marketing focus away from brand-name Humalog to Lilly Insulin Lispro in the U.S. instead. Lilly will still pay bribes/rebates to PBM's on Humalog, and occasionally win formulary placement, but it no longer needs to pay ever-higher rebates to achieve sales growth for a product whose patents have now expired, and as long as Lilly doesn't have many biosimilar competitors on the market selling for less money, Lilly can still capture those sales unless a rival like Sanofi (Euro API) finally reduces prices on its Admelog biosimilar which is very overpriced (even with a coupon, the price is $99/vial, twice what Lilly's Lispro sells for).

Meanwhile, Novo Nordisk is taking a slightly different tact: it is totally dependent on Rx rebates paid to PBM's to keep Novolog and Fiasp on insurance company formularies and to effectively generate sales. Patients and their doctors would not necessarily choose Novo Nordisk insulins, but by bribing PBM's with rebates, they become the preferred brand -- but it costs the company a large part of their sales. As I've asked before (see HERE for more), when will Novo Nordisk finally conclude that it can't afford to pay any more of its sales as PBM rebates? 

Right now, Novo Nordisk is paying 74% of its gross sales as Rx rebates paid to PBM's. Will it stop when that reaches 99% or before it reaches that? There are currently at least 3 insulin aspart biosimilars now in development including Viatris/Biocon, Lannett/HEC, and potentially others from both Lilly and Sanofi (soon to be Euro API) though neither Lilly nor Sanofi have succeeded selling biosimilars if Lilly's Basaglar or Sanofi's Admelog experiences offer any proof. 

By comparison, I was only aware of one version of Insulin Lispro in development from Sandoz/Gan & Lee and because its parent company Novartis now wants to spin Sandoz off as a stand-alone company, so far, Sandoz has yet to launch any insulin biosimilars in the U.S. There is some talk among European socialists to buy Sandoz and make it a government-owned public company that makes biosimilars including insulin, but it's unclear whether that will happen or not, and if so when. It would appear the Gan & Lee partnership was designed to enable Sandoz to compete on rebates, too, although it seems certain that it will have to launch heavily-rebated versions and un-rebated versions, just as Viatris/Biocon is now doing.

Back to Viatris/Biocon Insulin Glargine. 

Last week, Walgreens issued a press-release (see HERE for details) that Walgreens will offer Viatris Insulin Glargine through the Walgreens Prescription Savings Club, a paid membership program that carries an annual fee of $20 per individual or $35 per family. Through that, Viatris Insulin Glargine will sell for $71.99/vial or $84.99 for a box of five pens through the Walgreens Savings Club. That IS a slight discount (particularly on more costly insulin pens) but the question is whether the savings is sufficient to justify paying an annual fee of $20 per individual and $35 per family? It might if you use other prescriptions which are discounted more than the regular prices would be.

Still, the Walgreens announcement was rather curious because the prices were roughly what Semglee had previously sold for with a manufacturer coupon directly from Viatris. It does raise the question whether it is even necessary to pay Walgreens a fee for its Prescription Savings Club, or can patients avoid paying Walgreens a fee and just use a Viatris coupon, or maybe get coupons from GoodRx or PBM-operated coupon app instead? One element I did notice is that the only coupons which seem to be available for glargine are costly insulin pens. Old-fashioned vials/syringes are vastly cheaper, but coupons for that are less available.

United Healthcare's OptumRx and its Optum Perks coupon website/app seems helplessly addicted to brand-name Rx rebates and does not offer any coupons on any discounted biosimilar insulins, but Cigna's Express Scripts certainly does on what appears to be the Express Scripts' National Preferred Flex Formulary, which tends to favor drugs with lower list prices over the high-list/high-rebate versions of many drugs and is available via the Express Scripts InsideRx Cash-Pay Pharmacy, but it does not appear that many employer plan sponsors have adopted the Flex formulary, though we don't have a clue if the company is even marketing it because Express Scripts benefits more with fat rebates. 

Still, Cigna's Express Scripts InsideRx offers discount coupons which appears to access that formulary (recall that I blogged about how I bypassed our own PBM to buy a less-costly generic hypertension drug for my spouse called eplerenone using InsideRx), and using InsideRx coupons will enable people to access Express Scripts discounts. For example, the InsideRx site says the cost of "Insulin Glargine-yfgn" is $85.75/vial or $108.89 for a box of 5 pens (incl. at Walgreens). It is slightly more costly than Walgreens Savings Club prices are, but is still less than the cash retail prices would be plus consumers don't have to pay Walgreens a fee to get the InsideRx/Express Scripts price. If they use an InsideRx coupon and order using Express Scripts Cash Pay Mail Order Pharmacy with an InsideRx coupon, the price is just $67.67/vial or $86.52 for a box of 5 pens. The price per vial is cheaper than Walgreens sells it for with a paid membership, but pens are not.

It seems very clear that in order to be a biosimilar player in the U.S., it has become necessary to secure different NDC numbers for a heavily-rebated (to PBM's) version, and a less costly version of the exact same medicine unless the FTC finally investigates PBM activity for illegal behavior, which could still happen once it does some research into the matter.

For patients, it is a new level of unnecessary confusion but every entity in the U.S. pharmaceutical distribution system likes it and wish to become the default method of payment. Still, so far, only Cigna's Express Scripts InsideRx coupon-generating website/app is offering discounts on Viatris Insulin Glargine-yfgn, but we could yet see some rival coupon-generating websites/apps introduce them in the not-too-distant future.

Monday, November 01, 2021

How We Wrested Control of Our Rx Drug Spending. Maybe You Can, too.

This week, we've heard reporting that the big Congressional bill which was supposed to include a provision for Medicare, which is the taxpayer-funded senior insurance plan to actually negotiate prices on prescription drugs (just as most other countries, as well as the Veteran's Administration [VA] already do right now) was going to be omitted because of a handful of PhRMA-bankrolled lawmakers pushed to kill it. 

That said, it isn't over until its over. 

Although we don't know what she might or might not do, House Majority Leader Nancy Pelosi still has some tricks in her own playbook if it doesn't happen and she decides to play tough. In 2018, Nancy Pelosi marched into PhRMA's Washington, DC offices and told them in detailed terms of a federal statute (which is already law today) that allows the U.S. government to effectively strip drug companies of exclusive licenses to some blockbuster medicines (see HERE). That provides a path of action if lawmakers choose to do so.

I'm referring to "march-in" rights. March-in rights were created back in 1980, as part of the Bayh-Dole Act. That was signed into law by former President Jimmy Carter. March-in rights were introduced as part of a 1980 federal law aimed at promoting access to generic drugs, and it gives government agencies the authority to require private companies to license patents to third-parties, should the patent-holders happen to receive public funding. So far, to the best of my knowledge, I don't think the federal government has ever used march-in rights (in the 41 years they've had the ability to).

Prior to that statute, the U.S. government retained all patent rights resulting from research it had paid for. Pharma companies, their countless lobbyists and nearly all Republicans have long argued that use of march-in rights could squash biopharma innovation by controlling prices for certain drugs partially developed by government dollars and scientists, and therefore make the industry less willing to work with government agencies like the NIH. However, they offer no evidence to prove that innovation would be harmed, and a number of peer-reviewed studies conducted in academia have proven that to be a hyperbolic falsehood (see more HERE for more research published in the Journal of the American Medical Association conducted by a professor at Bentley University who's a MD and works in the University's Center for Integration of Science and Industry). There are others, of course, but even conservative health policy experts like Avik Roy admit that unprofitable drug and biotech startups can succeed under a wide range of pricing systems. In reality, use of march-in rights would merely make it less-easy to generate massive profits off the backs of American people and it might make pharma a little less presumptuous that they are protected no matter what. 

While the U.S. government has consistently refused to exercise its legal march-in rights in order to lower drug prices...theoretically it can, although if it fails to act judiciously, there is a risk of a lawsuit ending up before a conservative-dominated U.S. Supreme Court.

Still, yes, Nancy Pelosi went to PhRMA's offices and threatened that she could potentially use "march-in" rights which have been law since 1980. Although Congress has never done it before, she threatened the drug industry trade group that she might be forced to do something already within her power to do if the industry decides not to play nice. So far, the industry has refused to play nice, as if daring lawmakers to challenge them. For example, PhRMA has bankrolled a few Senators to try and kill Medicare's ability to negotiate drug prices, and those lawmakers have mostly done PhRMA's bidding. But it doesn't mean Pelosi can't give them the proverbial middle finger to prove she can actually do it, and that prospect terrifies PhRMA. She threatened them face-to-face that she might do it if they continue to make things difficult, which they have done.

One problem is that PhRMA is by no means the only bad seed in an incredibly dysfunctional system filled with players trying to collect money that they haven't earned. Think of corrupt entities like Pharmacy Benefits Managers (PBM's). David Balto, an antitrust litigator and former Policy Director with the U.S. Federal Trade Commission (FTC) described the role of PBM's this way (see the article he was quoted in HERE for details): 

"It's OK to have intermediaries, for example, we have Visa [in the payment cards space]. But these companies [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."

In recent years, I've grown increasingly disgusted by the shenanigans my spouse and I have experienced with prescription drug prices and that's been attributed to Pharmacy Benefits Managers (PBM's) owned by the largest commercial healthcare insurance companies. 

Quite frankly, its sickening. Not only is the drug industry behavior abhorrent, but it is literally making people sick because they can't afford medicines they need for survival.

My spouse and I have healthcare plans with pharmacy benefits which are paid for by employer insurance premiums, and yet each trip to the pharmacy results in our spending more and more. Someone is getting rich, because it sure as heck isn't patients.

I'd finally had enough, so I did what I usually do: I researched the hell out of the situation until I believe I know better than anyone what is really going on. Along the way, I also discovered a way to avoid getting screwed yet again. We recently began enacting our plan, and so far, it has slashed our prescription drug prices by an average of 75% (incidentally, for the statisticians in my audience, the median is also about 75%, which tells you there is not a wide standard deviation between the mean and the median figure, which suggests there's not a lot of variance between the lowest and highest in the statistical sample).

One learning moment occurred a number of years ago, when I was still spending hundreds on a single vial of insulin, and yet whenever I reviewed my deductible, it wasn't being reduced by nearly as much as I was spending on that.

The math simply did not reconcile. 

That's when I figured out that insurance companies were only applying credit in the amount of their own deeply-discounted prescription drug prices towards any deductible covered members must satisfy. The problem was they never disclosed how much they were actually spending on each drug or applying towards the deductible that needed to be satisfied, so the math was always fuzzy. Because patients don't really have access to those financial records, it was difficult to determine exactly how much they are applying for each drug purchase. 

On heavily-rebated Rx drugs like insulin, we later learned with certainty thanks to figures disclosed in Novo Nordisk A/S's quarterly investor presentations in 2021 that insurance company payers are getting rebates amounting to about 74% of the bogus list prices. We also know that list prices tend to increase by about 2% to 3% per quarter, and using simple math, if we deduct that amount plus 26% (which is the difference between the 74% rebates Novo Nordisk is bribing ...I mean paying... PBM's to get their insulins listed as the "preferred" brand on formularies), the numbers should come close to reconciling the amount your deductible is being reduced. The good news is that newer insurance policies tend to adopt IRS rules applied towards diabetes medcines which means more people with diabetes will be getting insulin pre-deductible in the future. But there are other drugs which are also on the IRS list which are curiously overpriced. Maybe the PBM's are bad negotiators? We know that their entire business model is driven by which brand-name drugs pay them the most money in Rx rebates; they may be terrible at negotiating generic drug prices because they don't really care about those as they are low-margin drugs.

Since that time, employers have switched insurance carriers several more times, and each company has their own policies on coverage of generics and IRS-specified pre-deductible drugs. Because our policy was a brand-new insurance policy as of last June, insulin is now covered pre-deductible in accordance with a July 17, 2019 IRS rule-change (I blogged about it HERE) which means I can now buy insulin at least at a predictable co-payment amount. The same seems to apply to CGM sensors and blood glucose test strips in my current plan.

But I was still pissed off about being screwed by my insurance company, only at least I knew what the heck was going on. Still, the unpredictable, fuzzy math behind what's being done with prescription drugs remains an ongoing problem. Insulin isn't the only prescription drug used in my household. And I can see more examples of overt financial gamesmanship going on with many of those, but I've seized control by using PBM's businesses to benefit myself financially. 

Here's how I did it:

First, I took inventory of the major prescriptions both of us were taking. I sorted them from highest expenses to lowest expenses on a monthly basis, and determined if it was a new, branded drug which had very high prices, I also discovered I can frequently find manufacturer coupons for some of those. Usually, the branded drug company has a website with a tab entitled "assistance" or "savings" or something to that effect. The drug company may ask for you to enter personal information which I find annoying, but you can simply enter bogus info except for a legitimate email address. They'll email you back with a link to a real coupon.

But I was more bothered by generic drugs whose prices were stubbornly high. Americans have been taught that generics are supposed to save them money, but we were not saving much on several generic medicines. In fact, prices on several had increased and were approaching the cost of some branded drugs.

Spending on one generic drug, in particular, looked very strange: My spouse uses a generic hypertension drug called eplerenone 50 mg tablets. CVS was charging $48.40 for just 30 tablets (even after satisfying the deductible), which seemed unreasonably high, so the first thing I did was turned to several reputable coupon-generating websites/apps (I check ALL of them, and lowest prices may win our business). Initially, we simply got a $10.00 coupon which reduced the cost at our regular pharmacy to $38.40 for 30 tablets. That was marginally better, but the cost per tablet was still an unreasonable $1.28 for what should be an inexpensive generic drug, so I still wasn't happy. I decided that wasn't cheap enough. It felt like it was still highway robbery, and we acted to avoid that.

Low and behold, I discovered we could buy the exact same generic medicine from Express Scripts Cash-Pay Mail Order Pharmacy using an InsideRx coupon (even though our insurance company uses Caremark as its PBM). The only thing was the doctor had to submit an e-script to Express Scripts; they don't accept paper scripts. So we drafted a letter and mailed it to the doctor asking them to submit an e-script for eplerenone 50 mg tablets to Express Scripts. We then set up an account at Express Scripts Cash-Pay Mail Order Pharmacy and placed and order. 

A few days later, the doctor evidently sent the e-script to Express Scripts. That simple move yielded us a stunning 82% savings, at a cost of just $25.39 for 90 tablets. That means it was 82% cheaper for us to simply bypass the pharmacy benefits of our own insurance company (which an employer is paying premiums to pay for), and buy the drug out-of-pocket (it was, after all, a generic med) and the cost was still a LOT cheaper than using insurance, plus we received 2/3 more tablets for less money. 

We also did the same thing for another generic eye drop used after a corneal transplant a few years ago for which that particular generic was also rather costly pre-deductible. While we will continue buying that at the regular pharmacy until the end of the year at a low co-payment amount, effectively stocking up while it is still being paid for by Caremark. But our aim was to simply not be robbed once the deductible resets on New Year's day.

The prices on that generic drug have remained stubbornly high, and though we were OK since satisfying the deductible, starting Jan. 1, 2022, it will be back to the same pricing nonsense. So we decided to arrange bypassing insurance pharmacy benefits and save (which cost around $15.40/bottle vs. about $28.99/bottle pre-deductible at the pharmacy). That worked out to about 80% savings as well. 

Finally, beyond that, I plan to do the same for rosuvastatin calcium 10 mg tablets. That is a very commonly-prescribed generic statin drug once known as Crestor. 

Our previous insurer provided that as a generic drug at no charge when we bought it via their mail order pharmacy. The good news is I accumulated some excess inventory of that. But our current insurer decided to screw us on that "cheap" generic, charging $33.84 for 90 tablets, which worked out to a cost of $0.38/tablet. 

As noted, I actually created some excess inventory during that time, although I discovered I can simply bypass our own PBM (which is CVS Caremark), and buy that medicine from a rival known as United Healthcare Group's PBM OptumRx using its OptumPerks price comparison and coupon-generating website/app. The cost for bypassing CVS Caremark resulted in the cost on that being reduced to a mere $15.00 for 90 tablets, or just $0.16/tablet (compared to $0.38/tablet). That works out to savings of 56%. We plan to buy generic Crestor tablets from United Healthcare Group's OptumRx PBM unit using their price comparison and coupon-generating website/app known as OptumPerks and will be buying it using Optum Store starting with my next refill. 

Truth be told, we could get it for roughly the same price at several nearby drugstores, but for pills, mail order works fine (I'm less enamored with mail order on items which must be temperature-controlled such as insulin; the PBM known as Caremark sent me spoiled insulin at one point in the past because it was allowed to sit in a 100 degree warehouse and the ice-packs all melted before it was even shipped, plus it took over a week for me to get it, so I do not trust that it will not happen again). One curious difference between Optum Store and rival Express Scripts Cash-Pay Mail Order Pharmacy is that Optum will actually accept paper scripts from your doctor (Express Scripts requires only e-scripts), and those can be mailed to: Optum Store, 6 South Second St. Suite 509, Hamilton, OH 45011, Phone: 855-946-4463, Fax: 650-434-4032. I've already placed my first order. 

It was when I was still covered by United Healthcare a number of years ago that particular insurance company suggested one way I could cut my costs on half on brand-name Crestor (which was still patent protected at the time) was by ordering 20 mg tablets and simply cutting the tablets in half. In fact, United Healthcare even provided me with a free pill-splitter. If I really wanted to reduce my costs, because the price is the same for both 10 mg and 20 mg tablets, I could go back to that method. But I can't be bothered. Cutting pills can be messy, and half of them ended up on my kitchen floor. But if cost-containment is a major issue, it works.

I don't mind some pricing differential, but in these cases, every single time I tried it, I instantly saved more than 56% each and every time, and in some cases, significantly more than that. The entity that was screwed? CVS Health. Not only did their retail pharmacy lose a sale, but their PBM Caremark also lost a sale and a transaction fee. The Aetna business unit is probably unconcerned either way, but the point is that financial gamesmanship CVS Health is taking with prescriptions forced me to abandon them and do business with their rivals. If they don't like it, they can reduce their prices to more sane levels. 

Still, while I know a bit more than the average consumer, I dislike a "system" which enables us to get medicines at 82%, 80% and 56% off instantly ... on three different drugs. And yet, that's the kind of seemingly legalized robbery which routinely happens in the U.S. prescription drug sales thanks to PBM gamesmanship and corruption. Some of this may be illegal (and maybe someday the FTC will seriously investigate PBM "rebate walls"); but PBM's rely on absolute secrecy to keep their scam going.

I think the aforementioned eplerenone robbery could also be part of the illegal price-fixing occurring with generic drugs that Connecticut Attorney General William Tong's two lawsuits (his 2 lawsuits were enjoined by the AG's of all other states, as well as Puerto Rico's AG; how often do all 50 states agree on anything?!) outlined in this Hartford Courant article now being litigated; I'm not certain. We just didn't want to be screwed with each visit to the drugstore once the deductible resets in January, so we shopped around on prices using multiple sights/apps in advance.

Truth be told, we did not bypass the pharmacy on each and every prescription used, although theoretically, we could have done so and likely broken even. But it has become tiresome of the overt profiteering which PBM's routinely put patients through. Keeping track of which prescriptions are purchased from which sources and whether they have refills requires additional work on our part. But the PBM's are "robbing Peter to pay Paul" as the saying goes. The ONLY entities making money are the PBM's, and maybe our employers who receive the benefit of "premium offsets" bankrolled by prescription drug rebate dollars. 

Curiously, this is one area where the pharmaceutical industry and patient groups COULD BE UNITED to advocate for legislation which would benefit both, but aren't currently because pharma sees patients not as partners, but as yet another enemy of the prescription drug industry which must be controlled rather than collaborated with. In reality, PBM's are screwing pharma and patients, and one would think that collaboration could yield mutually beneficial outcomes. But for whatever reason, the PhRMA model has relied on a messaging strategy to try and persuade patients that its the invisible "middlemen" solely responsible for their problems are the pharmacy checkout counter which is a falsehood. PhRMA has tried to manipulate patients to get reforms which benefit the drug industry yet leave patients without any resolution to their own drug pricing issues. Consequentially, PhRMA's selfish campaign has failed.

In the end, however, this kind of PBM behavior is unacceptable. But at least relatively new tools now exist which empower savvy patients to bypass their own pharmacy benefits by using a different PBM (in some cases; using a tool which is not even PBM-powered known as SingleCare and can generate instant discount coupons on certain prescriptions). 

But it should never be this way. In my assessment, the PBM's are robbing both pharma on heavily-rebated brand name drugs, while PBM's are simultaneously screwing patients on cheap generic drugs. None of this should be legal, and it may not be. But it will take a long trial in court to prove any of it. 

In the meantime, my suggestions to do what we did are as follows:

  1. NEVER trust the price you are asked to pay at the pharmacy on prescription drugs. Odds are, that's not the "real" price and unless its only a few dollars, only suckers pay that amount.
  2. Search at least 5 or 6 reputable prescription drug price comparison/coupon-generating websites/apps. Among them should include: SingleCare (currently the only one not powered by a PBM), GoodRx (this is a biggie which is powered by many different PBM's), InsideRx (Cigna's Express Scripts), OptumPerks (United Healthcare Group's OptumRx), ScriptHero (drug wholesaler McKesson) and maybe one other (your choice; the number grows all the time). This will enable you check prices at a variety of different drugstore chains and locations while using different PBM's for the same drugs. One may offer a clearly better price, and that's the one you may wish to use.
  3. Don't be afraid to buy directly from the PBM's mail order pharmacies. Often, they will deliberately sell at prices lower than other pharmacies within their own retail network sell the same drugs for. Beware: using them isn't as easy as buying something on Amazon. If I'm being truthful, it was kind of a pain in the ass to do initially, but the savings justified doing so. To use Express Scripts, we had to set up an account online first, then the doctor must send in an e-script. It took over a week to get everything working. But it DID deliver 82% savings on a generic medicine.
  4. Beware when buying generics. I'm not suggesting there's anything inherently wrong with generic drugs, but PBM price gamesmanship is extremely high on generic drugs. You are likely to find it elsewhere for much less except when its part of a special drugstore list of $4 generic drugs. Others may be corruptly overpriced. Know that you can bypass your own insurance plan's PBM and use a different PBM and get better prices on some generics. Occasionally, use of a discount program which bypasses PBM's (notably SingleCare) can occasionally yield even better savings.
  5. Finally, I suggest that lowest-price should likely win your purchase business. Loyalty really has no place when the prices are never the same for any two customers at the same store. Again, lowest price wins.

So that's been my personal experience with using various tools to slash our prescription drug spending by an average of 75%. In the meantime, we are fine saving 82% on drugs by buying them from a different PBM if it saves us more cash. Until lawmakers fix this fucking mess, that's the way it is. At least we found a practical way around the system.

Sunday, October 17, 2021

Stolen Recipes

About a month ago, I did something I never envisioned I might do. I was in CVS waiting for the pharmacist to give me a flu shot, and while I was waiting, I browsed the magazine rack. I looked at one which was entirely recipes. There was a recipe which kind of caught my eye: it was for "Loaded Cauliflower Soup". I would have bought the entire magazine, but then I looked at the price: a stunning $12.99...for a MAGAZINE with a flimsy cover (not even a real book).

So I opened said magazine and snapped a photograph of the recipe on my phone instead. I suppose one could call that theft, except that I did not remove the magazine from the store, and I also did not tear the recipe out of the overpriced magazine as some others do. I snapped a picture of the recipe. It took 5 seconds.  My stolen picture can be seen below!

In theory, I suppose I could have visited my local public library and sought-out the same magazine there (if it even carried the item), put it on the copy machine and gotten it that way, which is considered "legitimate" but I had no idea if I'd even find it there. If I had to guess, sales of this magazine will be low and they won't be publishing this magazine ever again. The thing is, I would actually have bought it if it wasn't sooooo over-priced (for example, I might have been willing to spend $5.99 on it). I just don't understand publishers who put a magazine together with such a ridiculous price tag.

Anyway, aside from stupid publishers, I actually made this recipe last week, and it was pretty good! I will likely make it again when the colder, winter months come and soup becomes a regular entree for me.

No, this recipe did not taste exactly like loaded potato soup does, but I think it was close enough and it had almost no carbs, which was the main reason I wanted to try it. There are some foods (and potatoes are one such food) which are often egregious carb consumption and there are very good substitutes for the real thing. For example, I enjoy cauliflower mashed potatoes at Thanksgiving and those taste great! Unlike fries or chips, which you can enjoy a taste of without requiring a giant bolus, you can't generally sample soup in a restaurant or deli the same way. 

I did modify the recipe for Loaded Cauliflower Soup in the overpriced magazine ever-so slightly. I used an entire head of fresh cauliflower (broken into florets for cooking, discarding the stem), although you also can use frozen cauliflower florets if that's easier. I live in NYC and because freezer space is at a premium in my apartment, while the head of fresh cauliflower fit into my refrigerator without a challenge. Plus, it was marginally less costly. Anyway, the recipe called for 3 cups of chicken broth, and I reduced it to two and a half cups, and instead added a full cup of half-and-half rather than only 3/4 of a cup. Sure, it increases the calorie count and fat calories in the recipe slightly, but I justify the modification since I was eating a healthier vegetable and that was basically my entire dinner. Be forewarned: this soup tastes best served immediately. I was less thrilled with it served as leftovers, although they tasted OK, too.

When I opt to make Loaded Cauliflower Soup again, I also plan to make my clean-up a lot easier. I took the cooked cauliflower out of the soup pot and used my food processor to make them smooth. But I think next time, I'll simply use my Braun Hand Blender in the soup pot itself. It will do the same thing. But I wasn't sure this time because I never made the recipe before, but I feel confident that would work just as well given how soft the cooked cauliflower becomes in the soup pot. That will make this recipe a lot less messy to prepare. Transferring everything into the food processor (or blender) was a totally unnecessary step if you can simply use a hand-blender in the soup pot itself. However, because I never made it before, I wasn't anticipating that the cooked cauliflower (cooked in chicken or vegetable broth) to become as soft as it actually became, which means it would totally work with a hand-blender instead. But you can learn from my experience.

I don't often discuss food on my diabetes blog because its not really my particular interest or expertise. But I have found cauliflower to be a rather decent subsitute for potatoes in many cases. For example, riced cauliflower works in place of rice in some recipes. I was a bit annoyed that Chipotle discontinued cauliflower rice -- they charged $2 more for it, so it's not like consumers weren't paying for the product (the company press release did say: "U.S. and Canadian restaurants will offer the new plant-based option for a limited time", see the press release for details) because that, too, was kind of a treat which I could eat without a large bolus. I'm still hoping the company will decide to bring it back permanently...someday. 

But, at home, I have made a personal favorite recipe (baked, stuffed bell peppers) because it's a very quick and filling dinner and is a balanced meal by itself substituting cauliflower rice for the real thing. Its become one of my personal favorite recipes (because its easy to prepare) which comes from a cookbook I've used at least 6 different recipes from and liked them all, which is called "The Casserole Queens Cookbook" and I recommend it, but they actually published one particular recipe I use quite often when I'm pressed for time on their blog, which can be found at for details) -- I substitute Splenda or Stevia for sugar in the recipe (or you can simply omit it; its not really a necessity), and I also omit the bread crumbs (and the optional tomato sauce) because both can be messy and are not even necessary, but you can add them if you really want. 

I have occasionally substituted cauliflower rice in that recipe instead of the carb-heavy real thing and the taste is acceptably close in my opinion. But I find making riced cauliflower a bit of hassle. Instead, that's one where I find buying cauliflower rice frozen from my local Aldi is not only cost-effective, but it's less hassle, too. If I wanted to go all vegetarian/vegan, I could probably substitute the ground beef I typically use in that recipe for a pound of Beyond Burger or another plant-based beef substitute (the number is growing all the time; Canada has one called The Very Good Butchers worth checking out if you're North of the 48th parallel) if I was seeking an entirely plant-sourced option. 

Still, I thought I'd share the overpriced "recipe" I recently acquired. I tried it and its a decent substitute for the real thing. I think it's one that works well for winter soups and its pretty easy to make.

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.

Click on image to enlarge

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. 

Click on image to enlarge

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 patients 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."