California to manufacture its own insulin, Newsom says


Live Brief:

  • California is preparing to produce its own supply of insulin in a move to lower costs and increase availability for people with diabetes, Gov. Gavin Newsom announced last week. The state’s new budget, signed by the governor, allocates $100 million to develop and manufacture biosimilar insulin products for Californians.
  • “Nothing epitomizes market failures more than the cost of insulin,” the governor said, citing a monthly $300 to $500 out-of-pocket expense for many Americans. “California is now taking matters into our own hands.”
  • California’s initiative follows on the heels of a bipartisan bill introduced in the Senate that would cap monthly insulin co-pays for insured patients at $35, a limit supported by President Joe Biden. The Senate bill, known as the Improving Needed Safeguards for Users of Lifesaving Insulin Now (INSULIN) Act, would also ensure prior authorization or other requirements could not be imposed to limit patient use.

Live Insight:

Diabetes is the most expensive chronic condition in the US, and one in three Americans is at risk of developing the disease in their lifetime, according to data compiled by the Centers for Disease Control and Prevention.

Medicare Part D enrollees spent almost $1 billion out of pocket on insulin in 2019, four times the amount spent in 2007, according to the Kaiser Family Foundation. The Health Care Cost Institute found nearly 9% of patients with private insurance paid an average of $403 per month for their insulin in 2019. One determined study that escalating costs for insulin have caused nearly 25% of patients to ration the medicine.

Concerned about skyrocketing insulin costs, 13 organizations, including the American Diabetes Association and the nonprofit JDRF, representing more than 37 million people with diabetes, sent a letter to congressional leaders this month urging of the INSULIN Act sponsored by Sens. Jeanne Shaheen, DN.H., and Susan Collins, R-Maine.

The nonprofit Civica, which is backed by hospital systems and philanthropies, is also targeting the affordability of insulin, pledging to manufacture the first of three planned low-cost biosimilar versions by as soon as 2024. Civica said in March that it plans to limit its prices to $30 for a vial and $55 for a box of five pen cartridges.

California now intends to make its own affordable insulin. Newsom said half of the $100 million budgeted to produce insulin in the state that would support development of low-cost insulin products, with the remaining $50 million going to fund a California-based insulin manufacturing facility that will create “new high-paying jobs and a stronger supply chain for the drug.”

The state plans to make the insulin available close to at cost, the governor said. “People should not go into debt to receive life-saving medication,” he said.

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