Is Insulin a right or a privledge?

This answer should be obvious but the American healthcare system disagrees. So what is Insulin and how does it affect people’s lives? Insulin is a hormone made by your pancreas and it keeps your blood sugar under control and it’s your main source of energy. When your pancreas stops producing insulin naturally you can become a diabetic which is what happened to me. I have type 1 diabetes meaning that my pancreas doesn’t produce insulin at all so to survive diabetics have to constantly be giving themselves insulin. There is a big crisis with insulin pricing right now and it’s been going on for a while now but it’s been brought to more people’s attention recently. So many people who can’t afford their insulin or can’t afford insurance have to ration their insulin. Insulin pricing has been rising since it was created. There are a multitude of reasons for why this is. Although my family and I don’t have to worry about paying for insulin or any of my other diabetes supplies other families do and the fact that people die from having to do this is insane. I want to change that, I want to help people not have to worry about how they are going to survive. Insulin is a right not a privilege meaning it should be accessible to everyone. However the American healthcare system may say otherwise. Insulin is not accessible to everyone because they can’t afford it or don’t qualify and if they can’t afford to pay for it they will likely die which is not something that should ever happen. We need to spread awareness about this issue because so many people are affected by this and so many people don’t know this is happening.

Throughout my research I discovered that there are about 8 different reasons for why Insulin prices are so high. The main thing I discovered was that it had nothing to do with how expensive insulin is to make. In Fact it’s the opposite, insulin is pretty cheap to make. So why does it still cost so much? There are only 3 pharmaceutical companies; Novo Nordisk, Eli Lilly and Sanofi. This plays a big role in the pricing of insulin since there aren’t other competitors and when one manufacturer raises their prices the other 2 raise their prices as well. The reason there are only 3 manufacturers of insulin is mainly due to patents. Patents are hard to come by and it stops other people from producing the same exact product. ¨Pharmaceutical companies take advantage of loopholes in the U.S. patent system to build thickets of patents around their drugs which will make them last much longer (evergreening).¨ A patent cannot be renewed so pharmaceutical companies will slightly alter their product so that they can get a new patent on it and this ends up raising prices of insulin. If they couldn’t get a new patent then a generic drug would be put on the market. It would be extremely similar to the name brand insulin and it would be cheaper but since manufacturers continue to renew their patents, people aren’t able to get generic drugs.

The last main role in the pricing of insulin is 3 companies; Pharmaceutical companies, insurance companies and pharmacy benefit managers. ¨Pharmaceutical companies set the list price for insulin, and are incentivized by profits to continue to raise those prices. For these companies, the price of insulin is a business decision.¨

This image is a map of how insulin pricing is determined. It shows how each player has a role in the pricing of insulin. This picture also shows how money is involved and who benefits most. (PBM’s). This image helped me fully understand how it all works because I could visually see it

So It all starts with Pharmaceutical companies (Drug manufacturers), they produce the product then they sell that to wholesalers who sell it to pharmacies. The price these 2 pay is determined by what the Pharmaceutical companies and the pharmacy benefit managers (PBM´s) negotiate. Once the PBM´s negotiate a price they contact pharmacies and pay them to disperse the drugs. This is where things get sneaky. PBM´s share a small portion of their rebate with insurance companies and they have them manage the drugs benefits. The insurance companies pay the PBM´s for the drugs and dispensing fees. Now I told you earlier PBMś pay pharmacies for this same fee but they (PBM´s) don’t disclose the amount paid to insurance companies so they often over pay and the PBM´s keep the difference. This is called ¨the spread.”

This picture is very similar to the first one but this one involves the consumers and it shows how some parts skip going through certain channels. For example, the drug company can go straight to the pharmacy and sell them the product instead of going through drug wholesalers. This is an easier way to understand what I just said because it can get very confusing. When looking at this map I started looking at the drug company and that’s where it all starts.

All of these reasons lead to the rise in insulin prices. Some people will travel to Canada so they can get insulin cheaper, since it’s cheaper in every other country. To put it in perspective, They found that overall, the average US manufacturer price per standard unit across all insulins was $98.70, compared to $6.94 in Australia, $12.00 in Canada, and $7.52 in the UK. Thats a huge price difference. This got me thinking, If other countries have affordable insulin my question is why can’t we? If other countries can deal with the same issues we have and still have it be affordable then why can’t we? My only possible answer is money, they want to make a lot of money and take advantage of people.

Annotated Bibliography