On September 21, 2023, Chicago-based Meitheal Pharmaceuticals, Inc. (which is a subsidiary of a Chinese parent company named Nanjing King-Friend Biochemical Pharmaceutical Co., Ltd.) announced an exclusive commercial licensing agreement with a different Chinese company known as Tonghua Dongbao Pharmaceutical Co. Ltd. with intent to sell three insulin biosimilars in the U.S. market.
The company press release can be seen at https://www.meithealpharma.com/news/61 while the pharmaceutical industry trade press covered the story at https://www.thepharmaletter.com/article/licensing-deal-to-bring-three-new-insulin-biosimilars-to-the-usa.
Meitheal announced its intent to sell biosimilars of the three bestselling insulin analogues currently sold in the U.S. (for insulin aspart, insulin lispro, and insulin glargine). The company expects to begin clinical trials necessary for the three insulin biosimilars in 2024. Meitheal will be several years later than a number of other companies currently which now have insulin biosimilars pending approval and are forecast to hit the market in 2024 assuming they receive FDA approvals.
Meitheal Pharmaceuticals will follow a nearly-identical commercialization path to virtually all other insulin biosimilars (exceptions being those from the biggest branded insulin-makers, including Lilly and Sanofi; Lilly sells copies of Sanofi's Lantus, and Sanofi sells a copy of Lilly's Humalog). Aside from copies made by the big branded insulin-makers, all other insulin biosimilars will involve either a U.S.-based company or a U.S. business unit of a company based offshore (Sandoz, for example). However, all will procure the Active Pharmaceutical Ingredient (API) for the insulin from laboratory partners who are based outside the United States.
Biocon Biologics originally entered the U.S. biosimilar insulin market back on July 28, 2021 with a partner known as Viatris in a joint venture. That partnership involved Viatris navigating the FDA regulatory applications and the bizarre peculiarities if U.S. drug distribution system with PBMs, drug wholesalers and whatnot, while Biocon focused on manufacturing and packaging done at a massive facility located in Johor, Malaysia not far from the Singapore border. However, on February 27, 2022, Biocon officially acquired Viatris' half of their joint venture although the company retained access to Viatris FDA experts and drug distribution system experts for a period of two years after the acquisition closed.
Biocon sells two identical versions of the exact same insulin biosimilar: known generically as insulin glargine-yfgn, although it initially focused on the PBM rebate-driven contract model selling branded Semglee. Specifically, in late 2021, it landed the insulin on the Express Scripts preferred drug formulary effective in early 2022, as well as those whom Express Scripts contracts on behalf, including Prime Therapeutics' PBM formularies. As a workaround, Viatris/Biocon introduced a separate, unbranded version (oddly, of a biosimilar) called Viatris U-100 Insulin Glargine Injection which had a list price which was 65% lower. Offering a branded/unbranded version of the product followed the path already established by Lilly back in 2019, Novo Nordisk in 2020 (and later, by Sanofi in 2022), except that Viatris/Biocon was selling a copy of a therapeutic originally developed by Sanofi. Biocon also applied for a biosimilar of insulin aspart (Novolog), but the FDA denied the original application for its insulin aspart biosimilar with a "Complete Response Letter" (CRL). After that, Biocon told investors that the company intended to respond to the CRL in order to satisfy the FDA's requests. Since then, that has been Biocon's focus, hence there has been little follow-up information on the status of its Novolog biosimilar. It is unclear whether Biocon also intends to sell a Humalog biosimilar.
Another biosimilar rival, specifically Civica, Inc.'s CivicaScript PBC operating unit, will procure insulin API's for the exact same three insulins from Hyderabad, India-based GeneSys Biologics (see https://www.businesswire.com/news/home/20220303005321/en/Civica-to-Manufacture-and-Distribute-Affordable-Insulin/ for a press release containing the API source, AND https://www.prnewswire.com/news-releases/jdrf-announces-support-of-civica-to-manufacture-and-distribute-low-cost-insulin-301495050.html for pricing details).
Even before its own insulin biosimilars have FDA approval, Civica has already had a major impact on U.S. insulin pricing. Civica is a nonprofit drug company established to respond to acute shortages of essential medicines used mainly in hospitals. In 2020, it established a public benefit corporation unit known as CivicaScript to bring affordable versions of common but high-priced generic medicines to market. The reason Civica has already had a major impact on biosimilar insulin prices is because CivicaScript has a unique Unilateral Pricing Policy ("UPP") that sets a Maximum Retail Price (MaxRP) for all CivicaScript products which is printed on all packages which patients can see clearly. Violations or refusal to participate in CivicaScript's UPP could result in loss of ability to purchase CivicaScript products (see https://civicascript.com/upp/ for more). There was a podcast episode featuring an interview with the President of CivicaScript Gina Guinasso (see HERE). Civica intends to sell its biosimilars of Lantus, Novolog and Humalog for $30/vial or $55 for a box of five prefilled insulin pens. Civica has also licensed Ypsomed AG's disposable UnoPen design (see https://www.businesswire.com/news/home/20230131005294/en/Civica-Welcomes-Ypsomed-as-Injection-Pen-Partner-for-Its-Affordable-Insulin-Initiative for more on the Ypsomed UnoPen licensing agreement).
Thus far, all biosimilars other than those from Civica (as well as Lilly and Sanofi) will be procured from laboratories based in China. Cost is the most obvious explanation. For example, we know that Switzerland-based Sandoz (and its U.S. unit Sandoz, Inc.) will procure biosimilars from China-based Gan & Lee. When Sandoz announced its intent to enter the U.S. biosimilar insulin market back in December 2018, the reason Sandoz cited for partnering with Gan & Lee in its press release was revealed as follows:
"Gan & Lee is a leading insulin supplier headquartered in China with more than 20 years' experience in insulins and production capacity with attractive cost of goods sold (COGS) structures."
Sandoz did not elaborate further, but since that time, the world has learned considerably more about what the underlying cost of goods sold (COGS) which Sandoz boasted about back in December 2018 actually are. Notably, in the insulin API supplier Gan & Lee's 2022 annual report (see https://www.ganlee.com/uploads/files/2023/0428/ILHLDWv4RJ5kJaR1AVfVZOMa8FgQrC13lKU6VnGH.pdf), if one fast forwards to page 62 of 375, we know exactly what its biosimilar insulin prices are. Specifically, the costs were disclosed in Chinese Yuan, referred to as "CNY", so using currency exchange rates, the U.S. Dollar (USD) amounts were calculated as follows:
- Insulin glargine injection 143.97 CNY = $20.83 USD
- Insulin lispro injection 60.00 CNY = $8.68 USD
- Insulin aspart injection 59.63 CNY = $8.62 USD
Note: There is no reason to presume that insulin glargine costs materially more to culture in a bioreactor and extract than insulin aspart or lispro costs. The manufacturing process is similar for all; the variance in prices are not based on underlying manufacturing costs, but the historical price differences between basal and prandial insulin analogues.
Other biosimilar companies will offer some (but not all) of the bestselling insulin varieties. One such firm is California-based Amphastar Pharmceuticals, Inc. which has been building its diabetes business since 2020. Amphastar introduced the first-ever generic version of old-school, mix & inject glucagon emergency kit (see https://www.globenewswire.com/news-release/2020/12/29/2151177/0/en/Amphastar-Announces-Approval-for-Glucagon-for-Injection-Kit-1mg.html for the company press release, and https://www.fda.gov/news-events/press-announcements/fda-approves-first-generic-drug-used-treat-severe-hypoglycemia for the FDA press release).
Amphastar's rein as the only generic glucagon rescue kit manufacturer quickly ended when Fresnius Kabi US had a second generic version of a mix-and-inject glucagon rescue kit which was approved by FDA and was commercialized by the Switzerland/Germany-based pharmaceutical company (see the press release for its FDA approval at https://www.businesswire.com/news/home/20200205005106/en/Fresenius-Kabi-Introduces-Glucagon-Emergency-Medicine-Kit-to-Treat-Life-Threatening-Episodes-of-Low-Blood-Sugar for more). Then, on April 23, 2023, Amphastar acquired from Lilly that company's "modern" glucagon product known as Baqsimi (see https://www.prnewswire.com/news-releases/lilly-to-divest-baqsimi-to-amphastar-301804855.html for the press release).
Amphastar has also been pursuing a number of insulin biosimilars, specifically a biosimilar of Sanofi Lantus and another biosimilar of Novo Nordisk's Novolog, and curiously, two versions of rDNA biosynethetic "human" insulins which some find surprising. I had originally suspected that would be Regular and NPH/isophane (the company only said it had TWO biosynthetic "human" insulins in development), but now I believe that those will be U-100 Regular and U-500 Regular (the latter expected to be the biggest seller) as Lilly is the only current supplier of that product in the U.S. Amphastar will procure the insulin biosimilars from an entity in China known as Amphastar Nanjing Pharmaceuticals, Inc. (ANP). While Amphastar claims that to be a "business unit", under Chinese law, it cannot "own" a Chinese unit, which means that ANP likely has an exclusive supplier relationship with the company. Although Amphastar also has the ability to procure insulin biosimilars from another business unit based in France, the cost equation strongly suggests the China-source will be preferred for the insulin API's, rather than a European-based source.
In 2016, Lannett Company, Inc. inititated a process to commercialize an insulin biosimilar of insulin glargine to be manufactured by YiChang HEC ChangJiang Pharmaceutical Co., Ltd., an HEC Group company. Lannett later expanded its strategic relationship with HEC in 2021, adding a new co-development agreement for second biosimilar analogue of insulin aspart. Like Civica, Lannett has licensed Ypsomed's disposable insulin pen which we know to be the UnoPen (see https://www.prnewswire.com/news-releases/lannett-announces-patent-licenses-for-the-pen-injector-delivery-device-to-be-used-for-its-insulin-glargine-and-insulin-aspart-development-program-301669481.html for more).
Anyway, while the offshore-based biosimilar insulin manufacture is the standard manner for competing in the biosimilar insulin space, the reality of multiple biosimilar-makers which can undercut branded insulin prices considerably has essentially FORCED major branded insulin manufacturers (Lilly, Novo Nordisk, and Sanofi) to slash their own insulin list prices, and to pay for that, they will simply disintermediate the PBMs from the transactions. See https://www.prnewswire.com/news-releases/lilly-cuts-insulin-prices-by-70-and-caps-patient-insulin-out-of-pocket-costs-at-35-per-month-301758946.html AND https://www.prnewswire.com/news-releases/novo-nordisk-to-lower-us-prices-of-several-pre-filled-insulin-pens-and-vials-up-to-75-for-people-living-with-diabetes-in-january-2024-301771409.html AND https://www.globenewswire.com/en/news-release/2023/03/16/2629188/0/en/Press-Release-Sanofi-cuts-U-S-list-price-of-Lantus-its-most-prescribed-insulin-by-78-and-caps-out-of-pocket-Lantus-costs-at-35-for-all-patients-with-commercial-insurance.html for more.
While the PBMs are not at all happy about their insulin kickback cash-cow being taken away from them, they have already moved on. In diabetes, for example, they now collect legally-exempted kickbacks from Dexcom paid to keep Abbott Freestyle Libre off-formulary (catch my coverage HERE). Senseonics/Ascensia's Eversense CGM bypasses those kickbacks by its coverage under patients' medical rather than pharmacy benefits. The FTC's 6(b) study of PBM business practices could see litigation to end formulary exclusions, but right now it is entirely speculation.
Some patients have expressed concern with offshore-made insulins, particularly those manufactured in China since FDA inspectors cannot freely-inspect China-based biotechnology laboratories. Those concerns are legitimate. By comparison, India-based biotechnology laboratories can be freely inspected by FDA. That said, for patients struggling to afford their insulin, the advent of biosimilars regardless of where they are cultured, should bring meaningful, sustainable price relief. The advent of biosimilars forced big branded insulin-makers to reconsider the PBM commercialization model and they concluded the insulin sells itself, they shouldn't pay more than 75% of their margins to PBMs for doing absolutely nothing.
However, a report from Democratic Senators Elizabeth Warren, Richard Blumenthal, and Raphael Warnock revealed that accessing discounted insulin from pharmacies is harder than it seems https://www.warren.senate.gov/imo/media/doc/Report%20on%20Insulin%20for%20Uninsured%20Patients%20-%2007.12.2023%20(updated)1.pdf.
According to a survey of over 300 pharmacies, less than half reportedly did not even sell Lilly Insulin Lispro, Lilly's less costly unbranded prandial insulin. Meanwhile, the vast majority of pharmacies still sold branded Humalog, the more expensive brand-name version. Many people were charged more than what the drug companies had promised, according to the report. The report found that on average, people without insurance paid $97.51 for Lilly Insulin Lispro. That is nearly four times the $25 rate that Lilly set in the U.S. for its unbranded insulin. Beyond those findings, the report explained that patients must still navigate confusing resources regarding insulin pricing. As a result, many people ended up paying more than the discounted prices.
Regardless, with the addition of Meitheal insulin biosimilars in the future, we will potentially have no fewer than six Lantus biosimilars (that explains why Sanofi finally got around to slashing its own prices on Lantus by 78%) and the same number of Novolog biosimilars. There will be four Humalog biosimilars (including one already sold by Sanofi branded as Admelog), but Lilly has been more aggressive in price-cutting its own unbranded version of Humalog. Right now, patients can instantly download coupons to buy Lilly Insulin Lispro for a price of just $35/vial from https://www.insulinaffordability.com/ while Novo Nordisk has its own manufacturer coupon program at https://www.novocare.com/diabetes/help-with-costs/savings-offers.html and Sanofi's manufacturer coupon program can be found at https://www.teamingupfordiabetes.com/sanofidiabetes-savings-program.
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