Insulin prices are falling. So why is Congress holding a hearing on the rising cost of insulin? The Biden administration and likeminded members of Congress think the issue is ripe for political points, even though their purported solutions would cause more harm than good.
The price of insulin, both what insurers pay and what patients pay at the pharmacy counter, is falling by several metrics. Medicare beneficiaries spent less out-of-pocket per insulin prescription in 2020 than in 2015. Average copayments for patients with Medicare and commercial insurance declined 27 percent from 2018-2021. Overall, copayments for three-quarters of insured insulin prescriptions are already under $35.
Competition is working. These declines happened prior to the Medicare insulin price cap passed as part of the Inflation Reduction Act. Outdated regulation had largely prevented generic or biosimilar insulin products. Initial progress with follow-on biologics (not authorized to be interchanged at the pharmacy counter) and authorized generics (alternatives still controlled by the original manufacturer) has been accelerated now that the FDA opened a new biosimilar approval pathway in March 2020. Since that time we have seen two biosimilar competitors approved with nine more in the pipeline.