Is the Insulin Price Reduction Act the Right Answer to High Insulin Prices?

At this point in the legislative calendar, it is time to take a look at what may have a likely shot at passing Congress before the 2020 election season gets underway. With the contentious debate on drug pricing that has occurred during the last several months, insulin pricing is still garnering plenty of attention.

This summer saw the unveiling of bipartisan legislation aimed to deliver a policy solution to rising insulin prices. Titled the Insulin Price Reduction Act, otherwise known as S.2199, the proposed legislation sponsored by Senators Tom Carper, D-Delaware; Jeanne Shaheen, D-New Hampshire; Susan Collins, R-Maine; and Kevin Cramer, R-North Dakota, seeks to hold payers, manufacturers, and pharmacy benefit managers accountable for insulin price increases.

According to Senator Carper’s press release, the bill would create a new insulin pricing model “where the use of rebates would be restricted for any insulin product for which the manufacturer reduces the list price back to a level no higher than the price of the product in 2006. For the most popular insulins, this would result in more than a [75%] decrease in prices compared to what we can expect to see in 2020. These rebate restrictions would apply in Medicare Part D and the private insurance market. Private insurance plans would also be required to waive the deductible for insulin products that met the list price reduction criteria. To keep these rebate exemptions and deductible waivers in future years, the manufacturer would have to limit any list price increase to no more than medical inflation.”

The bill does have support from industry stakeholders. This bill has been endorsed by the JDRF, the American Diabetes Association (ADA) and the Congressional Diabetes Caucus, and the need for insulin access is there. According to the ADA, “Between 2002 and 2013, the average price of insulin nearly tripled. For more than 7.4 million Americans, including all individuals with type 1 diabetes, insulin is a life-sustaining medication for which there is no substitute.”

While having stakeholder support is important, it is not the only factor that determines whether this bill advances. There are several bills in Congress proposing similar solutions to insulin pricing, on top of FDA’s interest in lowering insulin prices via the development of biosimilar and interchangeable insulin products. Not to mention the fact that the US Department of the Treasury has implemented guidance aimed at making chronic medication access easier for beneficiaries with High Deductible Health Plans that include Health Savings Accounts.

While the bill is bipartisan, it would help if more senators from both sides signed on to show broadening support. However, with the looming election season, it remains questionable whether both sides can agree on if the Insulin Price Reduction Act is the right vehicle to lower insulin prices.