By Bhanvi Satija and Patrick Wingrove
(Reuters) -Eli Lilly and Co on Wednesday said it will cut list prices by 70% for its most commonly prescribed insulin products, Humalog and Humulin, beginning from the fourth quarter of this year, a move that could help millions of Americans afford their medicine.
The Indianapolis-based drugmaker also will lower the price of its Lispro insulin injection to $25 a vial and expand its insulin value program so that an existing $35 cap on some insulins will now apply in about 85% of U.S. pharmacies.
The move comes as U.S. President Joe Biden has pushed to extend to most Americans the $35 cap on out-of-pocket insulin costs available to recipients of the government's Medicare health program, a move some lawmakers have also said they would support with legislation.
"While we could wait for Congress to act or the healthcare system in general to apply that standard, we're just applying it ourselves," Chief Executive Dave Ricks told CNN in an interview.
The changes could help around 2 million people pay for the life-sustaining drug. Although many people, including some 3.3 million on Medicare, already pay $35 a month or less for insulin, about 1-in-5 with private insurance and the 17% of insulin users who are uninsured stand to benefit.
Eli Lilly (NYSE:LLY), along with Sanofi (NASDAQ:SNY) and Novo Nordisk (NYSE:NVO) make up 90% of the U.S. market for insulin. Lilly shares were up 1.3% at $315.30.
Sanofi said its patient assistance programs limit out-of-pockets expenses for most insured patients to $15 a month, while uninsured people could pay $35 a month, but did not comment on whether it would drop to a $25 price following Lilly.
Novo Nordisk said it also had affordability programs, including one with Walmart (NYSE:WMT) to make insulin available at about $25 per vial and another providing diabetes patients with up to three vials for $99.
Biden, a Democrat, on Tuesday called on Congress and other manufacturers to lower the price of insulin as Lilly had done.
Ricks said in a media call that he had not spoken to the Biden administration about the change before it was announced, but that he had previously talked to lawmakers trying to cap insulin costs, including Republican U.S. Senator Susan Collins.
Some analysts have suggested the company was trying to get out ahead of lawmakers.
"It certainly appears they were reacting to the growing chances that Congress is going to cap insulin prices," said Brian Gardner, chief Washington policy strategist at Stifel investment firm.
The list price for Lispro, a cheaper version of its Humalog insulin, is currently $82.41 for 100 units/mL vials. A Humalog U-100 10 mL vial is $274.70, which will drop to $66.40, and a Humulin U-100 10 mL vial is $148.70. That will become $44.61.
Lilly last year said it would lower Lispro's price by 40% for some consumers.
List prices for drugs often differ from what patients actually pay, including after insurance and other assistance programs.
While the $35 price is only available in pharmacies participating in the company's insulin value program, Ricks said patients using other pharmacies can receive a rebate through the drugmaker's website.
These price cuts "should be the new standard in America," the CEO said, and he called on other companies and stakeholders "to meet us at this point."
Around 8.4 million of the 37 million people in the United States with diabetes use insulin, according to the American Diabetes Association.
Ricks said the company's insulin price cuts had been planned for some time and were accounted for in Eli Lilly's December financial forecast, which projected 2023 revenue of at least $30.3 billion.