Author: Kristina Fiore, Sarah Wickline Wallan, and Elbert Chu Source: MedPageToday (
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Retired nurse Mary Smith was having trouble controlling her type 2 diabetes on her regular insulin regimen, so her doctor decided to put her on something stronger.
Amber Taylor, MD, director of The Diabetes Center at Mercy Medical Center in Baltimore, wrote Smith a prescription for Humulin U-500 insulin, a much more concentrated form of the drug. It could deliver far more active ingredient at far less overall volume, which was important since Smith's insulin doses were getting high.
But when Smith showed up at the pharmacy, she was told she'd have to shell out $900 for a vial.
"There was no way I could afford that," Smith told MedPage Today as she recalled the pharmacy visit, which happened about a year ago. And the price has gone up since then: Now a single bottle of highly concentrated Humulin U-500 insulin that lasts a diabetes patient about one month costs $1,200 wholesale -- more than five times the $220 it cost in 2007.
Those increases have far surpassed those for the less concentrated Humulin U-100, which only rose three times during that period, at a rate comparable to the rest of the insulin market, a MedPage Today analysis found.
Although less than 5% of all diabetes patients are taking U-500, Taylor and other clinicians are wondering why an old insulin that had been on the market for many years and had remained relatively cheap suddenly became a valued commodity.
"I've had patients with a $2,500 deductible who can't put down $1,200 for a bottle of insulin," Taylor told MedPage Today. "For them, it's pay the mortgage or buy my insulin -- what do you want me to do?"
An Old Drug With a High Price Tag
Insulin is an old drug. Eli Lilly first put it on the market in 1923, and its more concentrated U-500 formulation, which was made from beef pancreas, appeared in 1952.
By 1980, Lilly was producing U-500 from pork pancreas, and that was finally replaced by a human formulation made with recombinant DNA technology in 1997.
Despite the fact that insulin is nearly a century old, prices have been steadily increasing as companies have found ways to upgrade the hormone. One of those strategies has been the development of insulin analogs, which include both basal and bolus versions: Lantus and Levemir, and Humalog and NovoLog.
Analogs are costlier, but endocrinologists say they are better, citing studies that show improved blood sugar control over regular human insulins.
Analogs cost about $270 per 10 mL vial, while regular human insulins such as Novolin and Humulin run about $120 per 10 mL vial.
The advantage of having a U-500 formulation is that it can deliver far more units of insulin (500 units per mL) at less overall volume than any of those other options. When a patient needs to inject more than 200 units of insulin per day, they start running into problems like insulin depot formation -- a lumpy deposit of insulin under the skin -- and diminished efficacy.
Physicians had been able to switch these patients to the more concentrated formulation at a lower cost. But now the price has risen to be equivalent on a per-unit basis with the U-100 concentration (which provides 100 units per mL), bringing the overall total for a typical 20-mL vial to a whopping $1,200.
Both U-500 and U-100 now cost about $0.12 for each unit of insulin (analogs are pricier, at about $0.27 per unit).
But prices of U-500 and regular human insulin weren't always equal. In 2007, regular Humulin cost $0.04 per unit of insulin -- twice that of the $0.02 price tag on each unit of insulin in U-500.
Realizing Potential
Demand for U-500 began escalating about 5 years ago, in lock-step with a worsening epidemic of obesity and diabetes. A 2009 study published in Endocrine Practice noted a 71% increase in vials prescribed per month from January 2007 to June 2008.
"The amount of insulin we are using is huge, as we are dealing with a more obese and insulin resistant population, thus we are now using more U-500," said Joel Zonszein, MD, of Montefiore Medical Center in the Bronx.
Prices of U-500 began to jump within a few short years. From $220 in 2007, the wholesale vial price rose to $340 in 2010, to $500 by the end of 2011, and to $900 just one year later in 2012.
In June of this year, a 20-mL vial started selling for $1,200.
Kevin Cammack, senior director of marketing for insulin at Eli Lilly, told MedPage Today that their sales representatives started getting more questions from doctors about U-500 over the last 5 years. As that demand rose, they began to educate all of their representatives about their concentrated insulin.
"Our product had been available and its use increased without promotion essentially," Cammack told MedPage Today. "Once [physicians] asked enough sales reps about it ... we stepped up and provided more information."
That's also when the company started to increase the price. Cammack said the per-unit cost was raised to equal that of its regular human insulin, Humulin U-100 -- hence the equivalent $0.12 per unit of insulin cost for both drugs.
"We felt it was probably appropriate to allow U-500 to be priced the same as other human insulins in the marketplace," Cammack said.
Wendy Lane, MD, who runs the Mountain Diabetes and Endocrinology Center in Asheville, N.C. and who has published several papers on U-500, sees some of the most insulin-resistant patients -- about 10% of her diabetes patients are on U-500.
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She lamented recent price increases in U-500 for the impact it has had on her patients.
"It has made it difficult for patients to stay on it or continue getting it," she told MedPage Today. "It shouldn't be that expensive."
Controlling Costs
This is not the first time a drug company has raised prices simply because it could. Pharmaceutical law experts say there's no regulatory framework to prevent drug companies from increasing prices based on demand.
"I am not aware of any laws that would prevent a pharmaceutical company from doubling the price of insulin," said Kate Greenwood, JD, a pharmaceutical law expert at Seton Hall University in New Jersey.
"There are statutes and regulations governing the price that pharmaceutical companies can charge Medicare, Medicaid, and other government programs," she continued. "These laws do not put a cap on the market price of a drug or drugs, however."
Lilly declined to provide data on sales of U-500. However, since it's an old drug, the increase in revenue came free of any additional R&D or production costs. And U-500 has the advantage of being the only player in the concentrated insulin space in the U.S. Novo Nordisk pulled its U-500 insulin Actrapid in early 2008, but a company spokesperson would not comment on that decision.
Cammack argued that overall costs are lower with U-500 because patients will need fewer total vials of insulin, and there's the potential for cost savings down the line, with better glycemic control afforded by a more powerful insulin.
Also, costs are generally picked up by insurers -- but that's not without caveats.
Zonszein said many diabetics on Medicare are forced into the doughnut hole by insulin costs, causing them to pay significantly out of pocket. And private insurance companies have been passing on additional costs to patients via higher deductibles and copays.
Lilly also set up a coupon program in 2013 that will cover a some U-500 costs, but physicians noted that not all patients who need assistance will qualify.
The company has also stepped up its U-500 marketing efforts to physicians. Cammack said U-500 was put on display for the first time at Lilly's booth on the exhibit floor of the 2013 American Diabetes Association meeting, and ads have been appearing in medical journals.
"It's being marketed more nowadays," said Sue Kirkman, MD, of the University of North Carolina at Chapel Hill. "You never used to see ads for it. I suspect it's because other strengths of other insulins are coming."
Will Price Wars Make Insulin Cheaper?
Some analysts say the market for more concentrated insulins is poised for growth. Sanofi is developing an updated version of its best-selling Lantus, which comes off patent in 2015. The new version will come in a U-300 concentration.
Novo Nordisk's ultra-long acting insulin, marketed as Tresiba in Europe, comes in a U-200 formulation.
David Kliff, who publishes the Diabetic Investor newsletter, said that U-500 will continue to serve a niche market, it "will make money" and Lilly "will be able to price it nicely."
Biotech startup Thermalin is also working on a U-500 concentration, but it hopes to make a rapid-acting analog version that has a different use from the current intermediate-acting U-500.
Thermalin CEO Richard Berenson cited consultancy estimates showing that by 2025, about 17.5% of diabetes patients could use some form of U-500 and that the concentrated insulin market could be valued at $3.2 billion.
Kliff was less optimistic about the growth potential of the U-500 market. The availability of "generic" or "biosimilar" insulin with the arrival of U-300 Lantus will likely drive overall insulin prices down -- but not necessarily by that much.
"When it gets here, the bottom line is that there's going to be a price war," Kliff said. "I don't think we'll see an 80% reduction in price, but there may be somewhere between a 30% to 40% reduction in price."
Whether that trend will also have an impact on the $1,200 price tag of U-500 remains to be seen. Taylor remains optimistic: "It's so frustrating that it's so expensive," she said, "but we hope with more products, the competition will decrease the costs."
Lane reported financial relationships with Eli Lilly.
Reviewed by F. Perry Wilson, MD, MSCE Assistant Professor, Section of Nephrology, Yale School of Medicine and Dorothy Caputo, MA, BSN, RN, Nurse Planner
last updated 09.12.2014
