California chooses Civica to produce low-cost insulin
SACRAMENTO, Calif. — Governor Gavin Newsom on Saturday announced the selection of Utah-based generic drug maker Civica to produce low-cost insulin for California, an unprecedented move that delivers on his promise to put the state government in direct competition with the brand. – name the pharmaceutical companies that dominate the market.
“People shouldn’t have to go into debt to get lifesaving prescriptions,” Newsom said. “California people will have access to some of the cheapest insulins available, helping them save thousands of dollars each year.”
The contract, initially costing $50 million that Newsom and his fellow Democratic lawmakers approved last year, calls for Civica to manufacture state-brand insulin and make the lifesaving drug available to any Californian who needs it, regardless of insurance coverage, by mail. order and at local pharmacies. But insulin is just the start. Newsom said the state would also seek to produce the opioid overdose reversal drug, naloxone.
Allan Coukell, senior vice president of public policy at Civica, told KHN that the nonprofit drugmaker is also in talks with the Newsom administration to potentially produce other generic drugs, but he declined to give a comment. details, saying the company is focused on making cheap insulin widely available first. .
“We are very excited about this partnership with the State of California,” Coukell said. “We’re not looking to own 100% of the market, but we want 100% of people to have access to fair prices for insulin.”
As consumer costs of insulin have soared, Democratic lawmakers and activists have called on the industry to get prices under control. Just weeks after President Joe Biden attacked Big Pharma for raising insulin prices, the three drugmakers that control the insulin market – Eli Lilly and Co., Novo Nordisk and Sanofi – announced that they would reduce the list prices of certain products.
Newsom, who has previously accused the pharmaceutical industry of abusing Californians with “extortionate prices,” argued that the launch of the state’s generic drug label, CalRx, will add competition and exert pressure. pressure on the industry. Administration officials declined to say when the California insulin products would be available, but experts say it could be as early as 2025. Coukell said the state-brand drug will still require FDA approval. , which can take about 10 months.
The Pharmaceutical Research and Manufacturers of America, which lobbies on behalf of brand-name companies, blasted California’s decision. Reid Porter, senior director of state public affairs for PhRMA, said Newsom “just wants to score political points.”
“If the governor wants to have a meaningful impact on what patients pay for insulins and other medications, he should expand his attention to others in the system who often make patients pay more than they do for drugs. drugs,” Porter said, blaming pharmaceutical middleman companies, known as pharmacy benefit managers, who negotiate with manufacturers on behalf of insurers for drug rebates and rebates.
The Pharmaceutical Care Management Association, which represents pharmaceutical benefit managers, has in turn argued that drug companies are to blame for the high prices.
Drug pricing experts, however, say drug benefit managers and drugmakers share the blame.
Newsom administration officials say inflated insulin costs are forcing some to pay as much as $300 per vial or $500 for a box of injectable pens, and too many Californians with diabetes are skipping or rationing their medications. This can lead to blindness, amputations, and life-threatening conditions such as heart disease and kidney failure. Nearly 10% of California adults have diabetes.
Civica is developing three types of generic, so-called biosimilar, insulin that will be available in both vials and injectable pens. They should be interchangeable with brand name products such as Lantus, Humalog and NovoLog. Coukell said the company will make the drug available for up to $30 per vial or $55 for five injectable pens.
Newsom said the state’s insulin would save many patients $2,000 to $4,000 a year, though critical questions about how California would get the products into consumers’ hands remain unanswered. , including how she would persuade pharmacies, insurers and retailers to distribute the drugs.
Last year, Newsom also secured $50 million in seed capital to build an insulin manufacturing facility; Coukell said Civica is considering building a plant in California.
California’s move, while never attempted by a state government, could be blunted by recent industry decisions to cut insulin prices. In March, Lilly, Novo Nordisk and Sanofi pledged to cut prices, with Lilly offering one bottle for $25 per month; Novo Nordisk promises major discounts to bring the price of a particular generic bottle to $48; and Sanofi has also slashed prices, with a bottle set at $64.
The governor’s office said it will cost the state $30 per vial to manufacture and distribute the insulin and it will be sold at that price. This, according to the administration, “will prevent the blatant cost shifting that occurs in traditional pharmaceutical pricing games.”
Drug pricing experts have said generic production in California could further reduce insulin costs and benefit people with high-deductible or uninsured health insurance plans.
“This is an extraordinary move in the pharmaceutical industry, not just for insulin, but potentially for all kinds of drugs,” said Robin Feldman, a professor at the University of California School of Law at San Francisco. “It’s a very difficult industry to disrupt, but California is about to do just that.”
This story was produced by KHN, which publishes California Healthline, an independent editorial service of the California Health Care Foundation.
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism on health issues. Along with policy analysis and polls, KHN is one of the three main operating programs of the KFF (Kaiser Family Foundation). KFF is an endowed non-profit organization providing information on health issues to the nation.
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