The authorities of California and a generic drug maker announced Saturday a 10-year partnership to produce affordable state-brand insulin that they hope it will compete with long-standing manufacturers and drive down the prices of a drug used by millions of Americans.
The product isn’t expected to hit store shelves until at least next year, and for now it’s hard to predict what effect it will have on a market already rocked by change. Earlier this week, another major insulin maker promised steep price cuts amid pressure on drugmakers and insurers to lower the cost of the drug.
The Democratic Governor Gavin Newsom said he hoped that the emergence of California as a manufacturer of insulin cause prices to collapse. Studies show drug prices have more than tripled in the past two decades.
“We intend to do this to disrupt the market,” Newsom said at a ceremony announcing the deal at a pharmaceutical warehouse near Los Angeles. He called it a “game changer” for about 8 million Americans who use insulin to treat diabetes.
However, there are still many questions. The state and its partner, the nonprofit organization Civica, have yet to create a manufacturing plant in California. Regulatory approvals will be needed. Newsom said a 10-milliliter vial of state-brand insulin would sell for $30, but competitors may lower their prices and undercut the state-owned product.
Just a few days ago, President Joe Biden said his administration is focused “intensely” on reducing health care costs, This includes lobbying drug companies to lower the cost of insulin. Law enacted last year capped copays for insulin $35 per month for those with Medicare. Biden has proposed extending that limit to all Americans.
Novo Nordisk said Tuesday it will cut some of its US insulin prices by up to 75% starting next year.. The announcement comes less than two weeks after rival Eli Lilly said it will cut some of its prices by 70% or more this year.
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