The Price of Insulin: A Q&A with Kasia Lipska

In 2016, Kasia Lipska, MD, MHS, associate professor of medicine (endocrinology), encountered something concerning in her clinic: One of her patients, a 78-year-old woman with long-standing type 2 diabetes and uncontrolled glucose levels, couldn’t afford to increase the dose of insulin she was taking.

The experience was eye-opening, Lipska said. After asking more of her patients how much they paid for the lifesaving medicine, she found that insulin unaffordability was widespread. The discovery led Lipska to learn more about the system behind insulin pricing.

Below Lipska discusses the basics of insulin, why it’s so expensive, and what she has uncovered in her investigations.

Insulin is a hormone that is produced by the pancreas. It puts sugar into our cells to provide energy. It was discovered just over a hundred years ago, and the initial insulin that was used for the treatment of diabetes was extracted from the pancreas of animals. Today insulin is produced by inserting part of the human insulin gene into bacterial DNA. The bacteria produce the insulin, which is then purified. Even though the insulin is produced through this process, it is still the naturally occurring hormone.

Diabetes is a disease that’s diagnosed when blood sugars are too high. In people with type 1 diabetes, the pancreas is no longer able to produce insulin. Blood sugar levels are high in the blood stream, but the blood sugar is not getting into the cells, where it can be used as energy. This results in weight loss, profound fatigue, thirst, and other serious symptoms. Without insulin, people with type 1 diabetes cannot survive.

In type 2 diabetes, people have some insulin but not enough to drive sugar into their cells, a state that is called insulin resistance. Some people with type 2 diabetes can be treated with pills or tablets, but others require insulin so that they have enough of the hormone to overcome insulin resistance and bring their blood sugar levels down. Over the long term, high blood sugars can lead to complications such as heart attacks, kidney failure, blindness, and amputations. Insulin is vital to the health of people with type 2 diabetes.

Insulin is seven to 10 times more expensive in the U.S. compared with other countries around the world. The same vial of insulin that cost $21 in the U.S. in 1996 now costs upward of $250. But it takes only an estimated $2 to $4 to produce a vial of insulin.

From when insulin is produced by the drug manufacturer to when it goes to a pharmacy, profit is extracted at every step of the way. The insulin market is dominated by three large drug manufacturers—Eli Lilly, Sanofi, and Novo Nordisk—that, with little competition, have raised their list prices in lockstep. But there are other players besides the Big Three that are contributing to the problem. Pharmacy benefit managers, or PBMs, contract with insurance carriers and act on behalf of the insurer to negotiate the price of insulin with the drug manufacturers. In negotiating the price, PBMs place a drug higher or lower on their tier of preferred drugs and receive rebates based on a percentage of the list price. This kind of system incentivizes high list prices, which determine the amount of co-insurance patients pay. And if patients have a high deductible or are uninsured, they might pay the entire list price.

To see how widespread the issue of insulin unaffordability is at the Yale Diabetes Center, we conducted a study that included 199 people who were prescribed insulin. In the survey, we asked them if they rationed insulin, meaning they stretched their prescription, didn’t fill it, or used less than prescribed because of cost. One in four patients told us they rationed insulin. That was one of the first studies that highlighted how much of a problem this was.

In another study, we found that more than 1.1 million Americans, or 14 percent of those who filled insulin prescriptions, reached catastrophic spending, defined as spending 40 percent of their post-subsistence income on insulin alone.

Insulin is essential for life. Without it, we die. And, unfortunately, there have been multiple deaths reported, mostly among young people with type 1 diabetes who were unable to afford insulin. That’s the most horrifying and severe consequence of rationing insulin.

For people who have insulin but are using less than prescribed, or for many people with type 2 diabetes, the complications include diabetic ketoacidosis, kidney failure, amputations, blindness, heart attacks, and strokes.

Advocacy is a powerful lever. There are patient-led organizations, like T1International, that have changed the conversation by exerting pressure on policymakers to better regulate insulin pricing. This advocacy can also come from clinicians and academics. It’s important for all of us to step in and raise our voices.

Insulin affordability should also be part of the conversation between clinicians and patients. The issue affects whether patients take a medicine as prescribed, their health outcomes, and can have downstream consequences in terms of what else patients may have to forego to pay for insulin. In addition, clinicians can sometimes find ways for patients to cut insulin costs by looking at different tiers of copays or assistance programs.

There is power in research. It’s important to have good data and to document and evaluate how changes in policy affect insulin rationing, and if we are making progress.

And obviously we need to change policy. Recently the Inflation Reduction Act was passed with a provision that caps insulin co-payments for Medicare beneficiaries at $35 a month. But I just saw a patient, a Medicare beneficiary, who paid $140 for insulin because of the types of insulin he is on and the way the insulin is packaged. And when that insulin runs out in 40 days, he's going to have to pay that again. Other patients at the Diabetes Center have had similar experiences. Even though we have this great new provision, the way it’s being implemented is not what I expected, or what I would imagine the policymakers intended. We have made some progress, but we need to be cognizant of how these policy changes play out and continue to refine them.

Yale’s Section of Endocrinology & Metabolism works to improve the health of individuals with endocrine and metabolic diseases by advancing scientific knowledge; applying new information to patient care; and training the next generation of physicians and scientists to become leaders in the field. To learn more about their work, visit Endocrinology & Metabolism