Eli Lilly to cut insulin price and cap monthly spending at $35

The company also trumpeted an existing policy that caps monthly payouts for its vital products at $35.

Drugmaker Eli Lilly and Company said on Wednesday it would significantly reduce the list prices of several of its lifesaving insulin products used by diabetes patients and whose prices Lilly has repeatedly raised in the past .

Seeking to quell outcry over excessive drug prices, Lilly also said it would cap what patients pay out of pocket at $35 per month. for the company's insulin - even though the company already had such a policy in place.

Lilly was a major contributor to the price spike an injection that millions of Americans rely on to keep their blood sugar levels down are levels that will keep them alive. The announcement comes at a time of mounting political pressure on pharmaceutical companies to rein in what lawmakers and other critics see as the industry's abusive profit model.

Over nearly three decades, for example, Lilly has increased the list price of its most widely used insulin product, Humalog, by more than 1,000%.

High costs of insulin made by Lilly and other drug companies - out-of-pocket payments for people on some high-deductible insurance plans can exceed $1,000 per month, although most patients pay a lot less - have led many patients to ration their insulin supply.

In his State of the Union address last month, President Biden criticized the pharmaceutical companies for raising insulin prices. "Big Pharma unfairly charged people hundreds of dollars, $400 to $500 a month, making record profits," he said. Mr. Biden hailed Lilly's announcement as "a big deal, and it's time for other manufacturers to follow."

Lilly trumpeted its decision as a victory for patients. In reality, however, Lilly's movements are more limited than they initially appear. Lilly's current $35 cap on out-of-pocket payments will make it easier for privately insured patients. But the policies announced Wednesday won't have much, if any, effect on what many people actually pay.

And Lilly was already charging insurers only a fraction of its high list price when accounting for rebates and rebates.

David Ricks, chief executive of Lilly, acknowledged in an interview on Wednesday that there was no guarantee the company's changes would result in insurers paying less for Humalog, although he did says he expected that to happen.

In addition, the lower list prices, which will come into effect during this year, will not only apply to former Lilly insulin products.

"I don't think these prices are as impressive as they look when you see them for the first time," said Stacie Dusetzina, professor of health policy at Vanderbilt University School of Medicine. "That doesn't necessarily mean Lilly is taking a big hit f inancial to do that."

More than 30 million Americans have diabetes, and more than seven million of them rely on insulin. Without insulin, patients can die or suffer serious health consequences, including amputation and kidney failure.

Lilly's price cuts follow years of mounting pressure, not only from officials in Washington and state capitals, but also from a well-organized community of patients who have demanded that insulin be made more affordable.

Lilly's announcement follows a change that took effect earlier this year for patients on Medicare. Under last year's Inflation Reduction Act, Congress imposed a $35 per month cap on insulin co-payments for Medicare patients.

Lilly said it plans to reduce the list price of Humalog by 70% in the last three months of this year.