California ready to disrupt market with affordable insulin

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DOWNEY, CALIFORNIA (AP) – The state of California in the United States (US) and a generic drug manufacturer announced a 10-year partnership on Saturday to produce affordable, state-branded insulin that they hope will rival longtime producers and push down prices for a medication used by millions of Americans.

The product is not expected on store shelves until at least next year, and it was difficult to predict what effect it would have on a market already shaken by change.

Earlier this week another major insulin maker promised steep price cuts as pressure builds on drugmakers and insurers to slash the cost of the drug.

Governor Gavin Newsom said he hoped California’s emergence as an insulin-maker would prompt prices to collapse. Research has shown that prices for the drug have more than tripled in the past couple of decades.

“We are intent to make this about market disruption,” Newsom said at a ceremony announcing the pact at a pharmaceutical warehouse near Los Angeles. He called it “a game changer” for eight million Americans who use insulin to treat diabetes.

California Governor Gavin Newsom, (L), and Health Access Organiser Manager Chris Noble smile after Newson announced a partnership with Civica Rx, a non-profit pharmaceutical company to manufacture insulin for the State of California’s CalRx Biosimilar Insulin Initiative during a visit to a Kaiser Permanente warehouse in Downey, California, in the United States. PHOTO: AP

Many questions remain. The state and its partner, the non-profit Civica, have yet to locate a California-based manufacturing facility. Regulatory approvals will be needed. Newsom said a 10-millilitre vial of the state-branded insulin would sell for USD30, but it’s possible competitors could slash their prices and undercut the state product.

“Is this perfect? We don’t know yet,” Newsom acknowledged at one point.

Just days ago, President Joe Biden said his administration is focused “intensely” on lowering health care costs, including pressuring pharmaceutical companies to lower the costs of insulin.

Legislation enacted last year capped copayments for insulin at USD35 per month for Medicare beneficiaries. Biden has proposed extending that cap to all Americans.

Novo Nordisk said on Tuesday that it will slash some of its US insulin prices up to 75 per cent starting next year.