Merkley, Durbin Introduce Legislation to End Price Gouging for Insulin

WASHINGTON, D.C. – Oregon’s Senator Jeff Merkley and Senator Dick Durbin (D-IL) today introduced the End Price Gouging for Insulin Act, legislation that would end drug companies’ exorbitant price hikes on insulin that have made it difficult for millions of Americans to afford the drug.

When insulin was first invented over a century ago, the researchers sold the patent to the University of Toronto for just $1 each, hoping that the drug would be used to save lives for everyone who needed it.  But over the last decade, the list price for common insulin products in the United States has tripled, despite the fact that the products are essentially the same. One recent study found that one in four Americans with diabetes is rationing their insulin, and some have died as a result.

Americans pay drastically higher prices for insulin than patients in other similar, developed countries. Americans who drive across the border to Canada can buy some brands of insulin for one tenth of the price. To end this price gouging, the Merkley-Durbin bill would require drug companies to offer insulin products to Americans at the median price of what they charge in eleven other major developed countries.

“While Big Pharma gouges patients to make big profits off of insulin, Americans are dying,” said Merkley. “Unaffordable high prices are leading to patients rationing their insulin, leading to dire health consequences—heart attacks, stroke, blindness, kidney failure, foot disease and amputations, even death. It’s tragic, it’s unacceptable, and it’s time to end this rip-off. No one should have to go bankrupt just to afford the daily medication they need to stay healthy. It’s time to put people above profits, and tell the big drug companies that their days extorting Americans who need insulin to survive are over.”

“It’s unconscionable that Americans are rationing their supplies of life-saving insulin because the prices charged by Big Pharma are more than $300, while at the same time a consumer in Canada can pay a mere $37 a month for the same insulin,” said Durbin.  “Our bill ensures American consumers in need of insulin are treated the same as other foreign countries that pay substantially less for this life-saving drug.”

“I have witnessed the cost of insulin skyrocket. A vital treatment that used to be $5 per bottle when I was first diagnosed now costs upward of $400,” said Merilee Silverstein, a Redmond, Oregon resident who was diagnosed with Type 1 Diabetes 58 years ago. “It is unconscionable that in the United States of America, people are dying because of the unaffordability of insulin. We need Congress to stop pharmaceutical companies’ greed. I thank Senator Merkley for proposing this solution.”

“One of our top concerns for our patients is the price of insulin. As we discussed with Senator Merkley last month, the price of this vital treatment is being artificially inflated, and we need to take steps to reduce both the complexity in pricing and the cost to patients,” said Albert Noyes, PharmD, CDE, BC-ADM, Director of Pharmacy Services, at Mosaic Medical in Bend, Oregon. “This insulin reference pricing bill is an important step in that direction, and we thank the senator for working to tackle this issue.”
“At a time when millions of patients are putting their lives at risk by reverting to rationing their insulin each year due to costs, we applaud Senators Merkley’s and Durbin’s leadership in introducing the End Price Gouging for Insulin Act.” said Eliot Fishman, Senior Director of Policy, Families USA. “This legislation would ensure families in America can stay healthy without paying exorbitantly more for insulin products than other nations.”

“At Virginia Garcia, our patients face barriers every day in their efforts to provide for themselves and their families,” said Gil Muñoz, CEO, Virginia Garcia Memorial Health Center. “Many medications, particularly generic medication prices, have skyrocketed in price over the last 3 to 5 years.  What used to be a nominal fee has now become cost prohibitive.  Insulin is a prime example. Most people with diabetes are on at least two different insulins and people with type 2 diabetes have other oral insulins they take also, making the overall cost of controlling their disease prohibitive. We thank Senator Merkley for his leadership in introducing the End Price Gouging for Insulin Act and his dedication to ensuring that everyone has access to the life-saving medications they need.”

“Patients For Affordable Drugs Now supports international reference pricing for prescription drugs as an effective way to bring prices in the U.S. more in line with the much lower prices paid in other wealthy nations,” said David Mitchell, a cancer patient and the founder of Patients For Affordable Drugs Now.

“Seniors on Medicare are among our patients who are hardest hit by insulin prices,” said Brenda Johnson, CEO of La Clinica in Medford, Oregon. “The fact that some of our most vulnerable community members are hurt most by the inflated cost of insulin is unacceptable and unnecessary. This bill would help align insulin prices in the United States with those in the rest of the world, and would lift a tremendous burden off of many seniors and their families.”

“The ever-increasing cost of insulin is harming our patients and their families every day,” said Nicolas Powers, CEO of Winding Waters health center in Enterprise, Oregon. “People are going without—without insulin, or without healthy food, or without adequate housing—because of these costs. While profitable for drug companies, going without results in a lower quality of life, and much higher health spending overall when these patients show up with a health crisis. We can do better.”

American companies maintain high prices on insulin with their price-gouging strategies such as limiting competition with patent ‘evergreening’—the practice of taking advantage of loopholes in the patent system to build ‘patent thickets’ for their drugs to extend their monopolies, or ‘pay-for-delay’ tactics where one drug company pays another drug company in order for them to not bring a lower-cost alternative to the market. This practice allows one manufacture to pay another one for not entering the market. That is why today we only have three insulin manufacturers—Eli Lilly, Novo Nordisk, and Sanofi—who control over 90% of the global insulin market.

The End Price Gouging for Insulin Act would require the Secretary of Health and Human Services to ensure Americans do not pay more for insulin products than a “reference price” established by the median price per drug in eleven countries:  Japan, Germany, the United Kingdom, France, Italy, Canada, Australia, Spain, Netherlands, Switzerland, and Sweden.

This legislation would require drug companies to offer insulin products at the established reference price to all individuals in the U.S. market. That includes individuals who are uninsured, individuals who are covered under a group health plan, or individuals who have purchased their own individual health insurance coverage.

An insulin manufacturer who does not sell insulin products at the established reference price will face a civil penalty, for each year in which the violation occurs and for each drug, in an amount equal to ten times the difference between the retail list price and reference price. Funds collected from the civil penalties will be transferred equally to the Medicare Trust Fund and the National Institutes of Health (NIH) for carrying out drug research and development.

The full bill text of the End Price Gouging for Insulin Act is available here.