Senator Wiener Introduces Legislation To Cap the Price of Life-Saving Insulin

FOR IMMEDIATE RELEASE

January 18, 2022

Senator Wiener Introduces Legislation To Cap the Price of Life-Saving Insulin

SACRAMENTO – Senator Scott Wiener (D-San Francisco) introduced Senate Bill 90, the Insulin Affordability Act. SB 90 caps the out-of-pocket cost of insulin at $35 for a 30-day supply and bans health plans from imposing a deductible on insulin prescription drugs. This measure will save Californians thousands of dollars each year and improve access to critical life-saving medication.

"No one should be forced to choose between food and insulin," said Senator Wiener. "If nonprofits like Civica Rx can sell insulin for $30, health plans and pharmacies have no business charging $400 for the same dose. Those groups, along with drug companies and middlemen, are raking in record profits while Californians are saddled with financial hardship and medical emergencies. This legislation will make California more livable for millions of people, setting firm deadlines and regulations for the middlemen responsible for the price increase in recent years."

About 4,037,000 adults Californians have diabetes, with an additional 231,503 cases of diabetes diagnosed each year. This rate of new cases is particularly high and disproportionately affects communities of color, the elderly, males and low-income individuals. Insulin is essential for all people living with Type 1 diabetes and many living with Type 2, meaning that millions of Californians rely on the drug.”

In recent years, the cost of insulin has exploded. Insulin is produced by just three manufacturers, and prices have roughly tripled in the past decade, though the amount people pay for their monthly doses varies based on their insurance coverage and other factors. Monthly doses can run as high as $400, or $4,800 per year, and deductibles can range in the thousands each year. Meanwhile, the nonprofit Civia Rx will begin producing a $30 dose of insulin in the coming months. 

Research has found that these increases are being driven by the small number of manufacturers and the rising role of middlemen such as pharmaceutical benefit managers. A 2021 study from the University of Southern California found that the share of insulin expenditures going to middlemen—PBMs, pharmacies, wholesalers, and health plans - had reached 53% by 2018, up from 30% in 2014.

As a direct result of these price increases, one in four people using insulin has reported insulin underuse because they can’t afford the full dose. Four in five Americans in need of insulin have incurred thousands of dollars in credit card debt to pay for the medication according to a recent survey.

SB 90 would lower these crippling costs for patients by prohibiting private health insurers and health maintenance organizations (HMO) from imposing deductibles on prescription insulin drugs. It would also require that they and limit co-pays to a maximum payment of $35 for a 30 day supply.

Lawmakers and regulators at all levels of government have attempted to tackle the skyrocketing costs of insulin in recent years. Last August, Congress passed the Inflation Reduction Act, which capped the price of insulin at $35 a month for seniors covered by Medicare. The legislation did not cover private insurers as SB 90 would.

In addition, Governor Newsom announced in June that California would begin to manufacture its own low-cost insulin. The state budgeted $100 million for the effort, called CalRx, but has not yet announced when the new low-cost insulin would become available.

Finally, earlier this week California Attorney General Rob Bonta filed a lawsuit against manufacturers Eli Lilly, Novo Nordisk, and Sanofi, and pharmacy benefit managers CVS Caremark, Express Scripts, and OptumRx, the nation's largest insulin makers and pharmacy benefit managers, (PBMs) for driving up the cost of insulin. His office alleged unlawful, unfair, and deceptive business practices in violation of California's Unfair Competition Law. The lawsuit seeks restitution for the Californians who have been overcharged and to reign in uncompetitive practices driving up the cost of insulin.

SB 90 is sponsored by the American Diabetes Association.

“More than 37 million Americans have diabetes, a disease for which there is no cure. Many of these individuals, an estimated 8.4 million, require insulin to live,” said Lisa Murdock, said Chief Advocacy Officer for the American Diabetes Association. “Unfortunately, the sky-rocketing prices for insulin have made this life-saving medication out of reach for many. Multiple national surveys have shown that as many as 1 in 4 insulin using Americans reported they ration insulin so they can pay for other life essentials like rent, food, utilities, etc. Rationing insulin places people with diabetes at risk for dangerous and costly health complications. That’s why we are so excited to be working with Senator Scott Wiener on legislation to cap monthly out-of-pocket costs for Californians who require insulin to live. The Senator’s legislation will cap monthly copayments on insulin to $35 per month and exempt insulin from insurance deductible requirements. Passage of this legislation would bring tremendous economic relief to Californians who require insulin to live.”