Novo Nordisk follows Lilly in sharply cutting price of insulin drugs

Dive Brief:

Diabetes drugmaker Novo Nordisk said Tuesday it will cut the price of several branded insulin products by as much as 75%, a move that comes amid changes in U.S. drug policy and persistent pressure over the high cost of medicines for the condition.
The list price of the insulins Levemir and Novolin will drop by 65%, and two forms of the rapid-acting insulin NovoLog will have their price cut by 75%. Novo will also similarly reduce the prices of its unbranded insulins.
Novo’s decision follows closely on the heels of an announcement by Eli Lilly earlier this month to reduce its insulin prices by up to 70%.

Dive Insight:

Lilly, Novo and their one-time rival Sanofi have long been criticized for the high prices they set on their insulin drugs, which can force significant costs on people with diabetes, even if they’re insured.

While all three have programs to help people afford insulin, cracks in a complex U.S. insurance system have left others exposed to high out-of-pocket costs or forced to ration the life-sustaining drug.

For years, Lilly and Novo steadily raised insulin list prices, although they’ve simultaneously paid larger and larger rebates to insurers. The recently passed Inflation Reduction Act caps the monthly cost-sharing limit on insulin at $35 for people on Medicare, spurring calls for further action to reduce costs for those who have commercial insurance.

Until now, the companies have mostly worked to expand their safety-net programs while continuing to raise list prices, arguing those increases have been offset by rebates to insurers. Lilly’s and Novo’s recent actions point to both changes in policy, and to the declining revenue that branded insulin products bring in.

Lilly’s insulin business, for instance, has shrunk significantly, even as it earns billions of dollars from other types of diabetes medicines, including its newly approved drug Mounjaro. Novo is experiencing something similar, and recently has focused more heavily on its treatment Ozempic, which belongs to the same GLP-1 drug class as Mounjaro.

“We have been working to develop a sustainable path forward that balances patient affordability, market dynamics, and evolving policy changes,” said Steve Albers, Novo Nordisk’s senior vice president of market access and public affairs, in a statement from the company. “Novo Nordisk remains committed to ensuring patients living with diabetes can afford our insulins, a responsibility we take seriously.”

A vial of NovoLog or NovoLog Mix 70/30 will cost $72.34, while a FlexPen formulation will cost $139.71. Levemir will carry a $107.85 per-vial list price, while a vial of Novolin will cost $48.20.

The price changes will go into effect on Jan. 1, 2024, Novo said.