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AMA Urges Federal Action to Respond to Insulin Price Hikes

For immediate release:
Jun 13, 2018
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CHICAGO—With insulin prices spiking, the American Medical Association (AMA) urged the Federal Trade Commission and the Justice Department to monitor insulin pricing and market competition and take enforcement actions as appropriate. The health care system is feeling the reverberations of the ongoing price increases and delegates at the AMA Annual Meeting supported a call to action. From individual patients to the Medicaid and Medicare programs, the pricing poses financial burdens that can’t continue unchecked.

“It is shocking and unconscionable that our patients struggle to secure a basic medicine like insulin,” said AMA Board Member William A. McDade, M.D., PhD. “The federal government needs to step in and help make sure patients aren’t being exploited with exorbitant costs. The AMA also plans to educate physicians and policymakers on ways to tackle this problem, and transparency from manufacturers and PBMs is a good place to start.”   

Uninsured patients paying cash for their prescriptions are exposed directly to high insulin prices. Insured patients are also directly impacted by high insulin prices when they are still in the deductible period, when the drug prescribed is not covered by their insurance, when a nonpreferred formulary status for a particular insulin product leads to a higher patient cost-share, and when a Medicare Part D beneficiary is in the “donut hole.” Insulin prices also impact health plans/payers and PBMs. The impact of insulin expenditures on Medicare and Medicaid has been notable. For example, expenditures for just one long-acting insulin analogue, glargine, were the second largest of all Medicare expenditures in 2015.

Insulin is one of the many essential drugs across all categories of pharmaceuticals—brand name, specialty, and generic—to experience remarkable price increases. The mean price per milliliter of insulin increased almost 200 percent, from $4.34 per milliliter in 2002 to $12.92 per milliliter in 2013. To date, at least five states and a federal prosecutor are demanding information from insulin manufacturers and PBMs. Class action lawsuits have been filed on behalf of patients.

In addition to seeking support from the federal government, the AMA plans to disseminate model state legislation to promote increased drug price and cost transparency and to prohibit “clawbacks” and standard gag clauses in contracts between pharmacies and PBMs that bar pharmacists from telling consumers about less expensive options for purchasing their medication.

The AMA called for physician education regarding price and transparency. Physicians will be in a stronger position to help their patients afford insulin if information systems can integrate price information. These efforts are in line with the AMA’s grassroots campaign and website, TruthinRx.org, which shines a light on the opaque process that pharmaceutical companies, PBMs and health plans engage in when pricing prescription drugs and to rally grassroots to call on lawmakers to demand transparency. Similarly, the AMA expressed support for initiatives, including those by national medical specialty societies, that educate physicians about the cost-effectiveness of various insulin therapies. 

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Media Contacts:
AMA Media & Editorial
(312) 464-4430
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About the AMA
The American Medical Association is the powerful ally and unifying voice for America’s physicians, the patients they serve, and the promise of a healthier nation. The AMA attacks the dysfunction in health care by removing obstacles and burdens that interfere with patient care. It reimagines medical education, training, and lifelong learning for the digital age to help physicians grow at every stage of their careers, and it improves the health of the nation by confronting the increasing chronic disease burden. For more information, visit ama-assn.org.

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