California Allots $100 Million to Produce Insulin, Improving Access

According to the CDC, patients with type one diabetes have a pancreas that produces no or little insulin. To properly manage the disease, many patients take insulin. With the price of insulin rising, multiple organizations and government agencies are looking for ways to reduce the costs. California recently allotted $100 million to the development of cheaper insulin biosimilars.

It is no secret that drug costs have risen dramatically in recent years. Based on data from the Kaiser Family Foundation (KFF), approximately 48% of all drug costs rose between 2019 and 2020. Insulin costs are no exception to this increase in price.

The cost of insulin in the United States is eight times more expensive than that in other developed countries, and recent data from a GoodRx Health report found that insulin costs increased an average of 54% between 2014 and 2019.

There are several causes of these increased costs, including drug patents and medication availability.

The American Journal of Managed Care (AJMC) states, “California is moving forward with plans to begin producing its own biosimilar insulin products. California’s governor, Gavin Newsom, recently signed the state’s budget for 2022 and 2023, which includes a $100 million allotment for developing low-cost insulin to increase availability and affordability of insulin in the state.”

The CalRx Biosimilar Insulin Initiative was outlined in the budget change proposal, highlighting the extensive financial burden insulin costs have on diabetic patients.

In addition, the justification portion of the proposal claimed, “CalRx enables California to manufacture generic drugs in highly concentrated, low competition drug markets. CalRx has the potential to become a ‘Producer of Last Resort,’ remedying drug shortages and addressing what researchers have described as oligopolistic market structures and other market failures that plague the pharmaceutical industry.”

Approximately half of the funding will be intended to pay manufacturers to help develop a variety of interchangeable biosimilar insulin products, while the other half of the money will be used to build an insulin development facility in California.

While it is still early in the progression of this initiative, health professionals and government officials are hopeful that it will positively impact diabetic patients in California. Reducing insulin costs may lead to better medication adherence, reduced incidences of diabetic emergencies, and better health for these patients.