Michigan could get into the insulin business under a new executive order Gov. Gretchen Whitmer issued today.
In an executive order that called the high price of insulin “egregiously” unsustainable, the governor directed state agencies “to explore how Michigan can deliver insulin at a lower cost to Michiganders.”
The executive order directs state agencies to study three approaches to lower insulin costs:
- the state, along with partners, developing a lower-cost biosimilar version of insulin to distribute in Michigan;
- the state producing, purchasing and/or distributing a biosimilar or other insulin products; and
- the state, either on its own or with partners, establishing “a Michigan-based insulin manufacturing facility” and identifying potential sites for any such facility.
“Our neighbors, family, and friends with diabetes need insulin to survive and for too long, drug companies have been jacking up prices, forcing them to make impossible choices between medication, food, rent, or other bills,” Whitmer said in a statement. “The American people pay ten times more for insulin than citizens of other comparable nations and costs have tripled over the last decade alone. I am confident that the Michigan departments I have tasked in this directive will take swift action to determine feasibility, and together, we will lower the cost of insulin, hold drug companies accountable, and save lives.”
The statement from the governor’s office included comments supporting the move from Dominick Pallone, the executive director of the Michigan Association of Health Plans, who said the “governor’s call for state departments to be bold and innovative is refreshing and welcoming, and we thank her for her leadership on this important consumer issue.”
Various proposals at the state and federal levels have sought to cap consumers’ out-of-pocket costs for insulin at $35 a month.
Just last week, the Michigan Senate passed two resolutions introduced by Sen. Curt VanderWall, a Republican from Ludington who chairs the Senate Health Policy Committee, that urge the governor, state agencies and regulators, and the Michigan Economic Development Corp. “to take action to make insulin more accessible and affordable.”
“If we do not address the rising costs of insulin, we put vulnerable Michiganders at risk and endanger their long-term health by increasing the possibilities of complications stemming from diabetes, as well as increase costs to the health care system,” the resolutions state. “As leaders of Michigan, we must aggressively initiate action to make insulin more accessible and affordable for all who need it.”
The resolutions call on the governor and agencies to explore public-private partnerships to lower costs by having the state buy insulin in bulk or making it in Michigan.
“With so many Michiganders struggling to manage their diabetes, access to readily available and affordable insulin is critical. All insulin users, including those with both public or private insurance plans, should have that opportunity and get the insulin they need,” VanderWall said in the statement from the governor’s office.
Today’s executive order, along with the Senate resolutions, “shows we agree that something needs to be done. I look forward to working with the governor, state departments, and the legislature to create an initiative that can help so many of our citizens,” VanderWall said.
A 2019 study published in the Journal of the American Medical Association reported on a study that showed one-quarter of patients at an urban diabetes center either skipped doses or take less than what they are prescribed because of the high cost of insulin, which tripled over a decade. That resulted in poor control of their diabetes and highlighted “an urgent need to address affordability of insulin,” according to the JAMA report.
CivicaRx, a nonprofit generic drug company formed in 2018 by several large health systems in the U.S. and whose investors include Spectrum Health and Trinity Health, plans to begin producing three forms of generic insulin by 2024. CivicaRx intends to price its insulin at no more than $35 per vial, and no more than $55 for a box of five injectable pens.
Atheer Kaddis, vice president for pharmacy services at Blue Cross Blue Shield of Michigan, told MiBiz in March for a story on CivicaRx that in the decade from 2010 to 2021, the cost for a month’s supply of insulin increased from $211 to $511. About 12 percent of the 3 million people enrolled in pharmacy benefits with Blue Cross Blue Shield of Michigan are diabetics who use insulin to treat their condition, resulting in a cost that’s in the “hundreds of millions of dollars” annually, Kaddis said.
Blue Cross Blue Shield of Michigan invested in CivicaRx in 2020.
CORRECTION: An earlier version of this story incorrectly spelled the name of Dominick Pallone.