[Congressional Record Volume 167, Number 215 (Tuesday, December 14, 2021)]
[Senate]
[Pages S9130-S9132]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                                Insulin

  Mr. President, it turns out it is an anniversary, just this month. 
You see, in 1921, 100 years ago, a Canadian scientist named Frederick 
Banting discovered insulin. He sold the patent for this discovery to 
the University of Toronto for $1. He declared that this lifesaving drug 
didn't belong to him: ``It belongs to the world.''
  He wasn't the only unselfish scientist I can remember. I remember, as 
a kid, our fear of polio, and along came Dr. Jonas Salk--bless his 
soul--who discovered the vaccine that we needed to protect ourselves. 
There was no great political debate. People weren't threatening 
lawsuits. My mom and dad said: Line up and roll up your sleeve, kid; we 
are going to do what needs to be done to protect you from polio.
  Dr. Jonas Salk gave away the patent to that drug as well. It was a 
different era, perhaps, when insulin was discovered or the polio 
vaccine, but we should reflect on the state of play today of that drug, 
insulin.
  One hundred years later, there are 8.4 million diabetics in the 
United States who rely on insulin. They have to pay--many of them--an 
exorbitant amount of money for a drug that supposedly belongs to them, 
according to its discoverer.

       As the cost of insulin has risen, average list prices 
     increased 40 percent for insulin between 2014 and 2018.

  I am quoting from an article in today's USA Today by Katie Wedell.

       Patients and their families shell out hundreds of dollars a 
     month even if they have good insurance.

  Rod Regalado is a father of a teen with type 1 diabetes. Do you know 
what he calls the insulin pricing system? Legal extortion.
  This article tells the story of what he went through. He had never 
heard of a pharmacy benefit manager before 2 years ago, but it was 2 
years ago that his son Matt, then 14 years old, was diagnosed with type 
1 diabetes, and Mr. Regalado got a crash course in insulin pricing in 
America today.

       His first trip to the pharmacy when his son was released 
     from a hospital came with a $1,000 price tag for all the 
     testing supplies and insulin he'd never purchased before. The 
     next month, when all he had to do was buy more insulin, the 
     price was still north of $400 after insurance.
       The single dad of two said he thought he had good insurance 
     until he found himself having to redo his entire household 
     budget to afford the insulin to keep his son alive.

[[Page S9131]]

       ``I thought how do people do this?'' he said.

  He is a resident of Tekamah, NE. He started making calls to his 
insurance company, the pharmacy, and doctors, trying to figure out a 
way to lower his out-of-pocket expenses for the insulin that his son 
needed to survive.
  Then he called his Congressman. Congressman Jeff Fortenberry, a 
Republican of Nebraska, said in July: ``The harsh reality is that the 
cost of insulin is artificially high and ever-escalating.''
  He has introduced a bill for capping the prices. They call it Matt's 
Act, after Mr. Regalado's son. Matt's Act would make insulin prices 
fair for everyone by capping the price at $60 a vial and $20 a vial for 
those on insurance.
  What a dramatic difference that would make for the Regalado family in 
Nebraska--instead of $400, $20.
  The reason I raise that is that the provision in law that we are 
trying to enact is in the same bill that the Republican leader just 
came to the floor and told us America cannot afford. The tax increases 
in that bill--and there will be tax increases--will only apply to 
people making over $400,000 a year. And yet the Republican leader comes 
to the floor and talks about this terrible idea of raising taxes.
  So let's step back and measure the difference here. Should Mr. 
Regalado--a single dad, father of two, with a 14-year-old son who needs 
insulin to live--be paying $400 a month or $20 a month for the 
insulin--the lifesaving insulin? And to make up the difference, is it 
unfair to ask someone making over $400,000 a year to pay more in taxes?
  You be the judge. I don't even think it is a close call.
  What we need to do is to get down to business. I don't know that 
there will be a single Republican voting to support this effort to 
reduce the cost of insulin for diabetics. That is just the way politics 
works in this Chamber, I am afraid. But I do hope that the 8 million 
families who have a diabetic son or daughter, father or mother will 
step up and speak up in the next few days because we have a chance to 
bring this measure to the floor this year--a measure that will affect 
many different areas of the law but, specifically, the cost of insulin 
for American families.
  If those 8 million families will stand up and speak up and say to 
Members of the U.S. Senate, ``Enough, you have negotiated enough; close 
the deal; do something that will be helpful to our families,'' just 
maybe that can make a difference.
  Maybe the endless negotiations that have gone on for month after 
month after month will finally come to an end. Now is the time to get 
it done. We have work to do in the Senate at clearing the bill for 
final passage. But I think we are on track to get that done. What we 
need to have is a groundswell of support from across the America.
  When you take a look at the other provisions in the bill, helping 
working families to pay for daycare--for goodness' sake, there is 
hardly a family around, unless they are very wealthy, that isn't 
concerned about the cost and quality of daycare available.
  We have a provision in this bill, the same bill that Senator 
McConnell spoke against just a few minutes ago, to help families pay 
for daycare. Is it important to these families? Well, it is important 
to my family. I visited with my granddaughter over the weekend, and I 
am sure there are many people in my situation, with grandchildren, who 
look at those kids and realize they should be in a safe, nurturing, 
affordable environment every single day so mom and dad don't have to 
think twice.
  Is it important to have a provision in the law which says we are 
going to provide home healthcare services to elderly members of our 
family or disabled members of our family?
  I will tell you this. The elderly folks whom I spoke to, the senior 
citizens, want to stay independent as long as possible, and they want 
to stay home as long as possible. If we can help them stay home and be 
independent, why wouldn't we do it? If it means a tax increase for 
people making over $400,000 a year, so be it. Sign me up for that 
increase. That is the sort of thing I think we do in America. Those who 
are well off pay a little bit more in taxes so those who are struggling 
can get a helping hand.
  So when the Republicans come to the floor and tell us how terrible 
this bill is, well, tell it to 8 million families in America with 
someone who needs insulin to stay alive each month. Tell it to the 
millions of families with kids who want to make sure they have peace of 
mind that these kids are being taken care of while they go to work. 
Tell it to the families with elderly parents or people who are disabled 
in their household who need a helping hand to be able to stay home and 
have quality healthcare.
  All of these things are addressed in this bill. It is important that 
we pass it, and I hope we do it soon. But we need to hear from America 
to create the momentum to get that job done.
  Mr. President, I ask unanimous consent to have printed in the Record 
this entire article, from USA Today, on insulin.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                            [From USA Today]

   `It Is Legal Extortion': Diabetics Pay Steep Price for Insulin as 
                         Rebates Drive Up Costs

                           (By Katie Wedell)

       In 1921, Canadian scientist Frederick Banting discovered 
     insulin and later sold the patent to the University of 
     Toronto for $1, declaring that the lifesaving drug did not 
     belong to him. ``It belongs to the world.''
       One hundred years later, the 8.4 million diabetics in the 
     USA who rely on insulin pay an exorbitant amount of money for 
     a drug that supposedly belongs to them.
       As the cost of insulin has risen--average list prices 
     increased 40% from 2014 to 2018--patients and their families 
     shell out hundreds of dollars a month even when they have 
     good insurance. They pay other bills late to keep their 
     insulin-dependent children alive. When they can't make ends 
     meet any other way, they ration their medication, often 
     ending up in a hospital because they could afford only a 
     fraction of the insulin they were supposed to use that month.
       ``It is legal extortion,'' Rod Regalado, father of a teen 
     with Type 1 diabetes, said about the opaque insulin pricing 
     system.
       A bill that would create a federal cap on monthly insulin 
     out-of-pocket costs is named after his son. Matt's Act would 
     cap insulin prices at $20 to $60 a month or even $0 for those 
     with high-deductible health plans. Similar provisions are 
     included in the House-passed version of the Build Back Better 
     Act, which proposes an insurance co-pay cap of $35 for 
     insulin.
       The bills attempt to simplify costs for consumers who are 
     kept in the dark when it comes to the complex negotiations 
     driving insulin prices up.
       ``If you or I were buying a gallon of milk from Kroger or 
     whoever, if we saw that it was $20, we would know that we're 
     getting ripped off,'' said Antonio Ciaccia, former lobbyist 
     for the Ohio Pharmacists Association and CEO of 46brooklyn, a 
     drug price research firm. ``The gallon of milk stays within a 
     slightly competitive range because we know where we could go 
     elsewhere to find a $3 gallon.''
       That competitive price pressure doesn't exist in health 
     care, he said. ``Because we as cash-paying customers aren't 
     the predominant source of revenue for health care,''
       In a report on insulin prices released in January, the 
     Senate Finance Committee laid out the numerous factors that 
     combine to make insulin so expensive.
       The committee found that drug manufacturers continually 
     increase insulin's list price to offer larger rebates to 
     pharmacy benefit managers and health insurers, ``all in the 
     hopes that their product would receive preferred formulary 
     placement,'' the report said.
       Pharmacy benefit managers, or PBMs, oversee the 
     prescription drug part of health plans--negotiating with 
     drugmakers for bulk discounts and deciding which drugs will 
     be covered and which will be excluded from their formularies 
     or approved drug lists. Their clients are health insurance 
     plans, including employers and government-run Medicare and 
     Medicaid.
       No drugmaker wants to be left off the preferred list of a 
     big PBM such as CVS Caremark or Express Scripts, because tens 
     of millions of Americans are covered by insurers using their 
     services.
       This pricing structure exists for almost every drug on the 
     market, but insulin has gotten focused attention because of 
     the number of diabetics that rely on the lifesaving drug and 
     the fact that it's 100 years old yet getting more expensive 
     every year.
       ``They're kind of between a rock and a hard place,'' 
     Ciaccia said of the manufacturers. Many have made lower-cost 
     versions of their products available, but those don't get 
     listed on the formularies because they don't offer any 
     rebates on them, he said.
       Rebates are payments offered back to the PBMs in exchange 
     for preferred placement on their formularies. If the list 
     price is $400 for an insulin product, the manufacturer may 
     make $100 and give the other $300 back to the PBM, which 
     typically passes those savings to its clients--employer and 
     commercial health plans.
       Patients may be forced to pay that $400 list price when 
     they are in their deductible phase

[[Page S9132]]

     and don't get any of that rebated money directly.
       The government report found that manufacturers offered 
     higher and higher rebates each year, in fear of being kicked 
     off the preferred formularies. That means they must also 
     inflate the list price each year to keep pace.
       In July 2013, insulin maker Sanofi offered rebates of 2% to 
     4% of the list price--also called the wholesale acquisition 
     cost or WAC--for preferred placement on CVS Caremark's 
     formulary, the finance committee found. Five years later, 
     Sanofi rebates were as high as 56%.
       Critics of the rebate system say it amounts to legalized 
     kickbacks. In 2019, a class-action lawsuit accused 
     manufacturers and PBMs of engaging in a commercial bribery 
     ``scheme,'' conspiring to raise the prices of insulin drugs 
     to increase the fees manufacturers paid to PBMs.
       Pharmacy benefit managers say the manufacturers drive up 
     prices and keep out any competition from generics.
       ``Insulin pricing strategies used by drug manufacturers to 
     avoid competition through ongoing patent extensions on 
     insulin products are a significant barrier to getting costs 
     down,'' said Greg Lopes, spokesman for the Pharmaceutical 
     Care Management Association, which represents PBMs.
       ``PBMs have introduced programs to cap, or outright 
     eliminate, out-of-pocket costs on insulin, and PBMs have 
     stepped up efforts to help patients living with diabetes by 
     providing clinical support and education, which result in 
     better medication adherence and improve health outcomes,'' 
     Lopes said.
       Manufacturers, PBMs and nonprofits have set up patient 
     assistance and coupon programs to reduce what patients spend 
     on insulin. Each program has its own requirements to qualify, 
     its own rules and restrictions, and patients have to be aware 
     that the programs exist.
       Drugmakers often advertise their patient assistance 
     programs, but the onus ultimately lies with the patient to 
     find and apply for free or reduced-cost insulin. Numerous 
     organizations have developed databases of assistance programs 
     to help patients navigate the sea of options, including 
     PhRMA's Medicine Assistance Tool, RxAssist, NeedyMeds and 
     Beyond Type1's GetInsulin.org.
       ``For the population that can take advantage of those 
     programs, that's great,'' said American Diabetes Association 
     Chief Advocacy Officer Lisa Murdock. ``We think insulin 
     should be affordable at the point of sale for everyone.''
       Lopes pointed out that PBMs pass through to health plan 
     sponsors the vast amount of the rebates they negotiate. In 
     the case of Medicare Part D, the PCMA said that amount is 
     99.6%.
       ``The rebates are then used to lower premiums and out-of-
     pocket costs for patients,'' Lopes said.


          Consumers can pay hundreds more under rebate system

       Nonprofit drug price research group 46brooklyn released a 
     report demonstrating how patients end up paying more because 
     of rebates.
       It looked at a box of Lantus insulin pens--which hold pre-
     dosed cartridges for easier injection--with a list price of 
     $425. According to the Finance Committee's report, Lantus 
     offered the PBM OptumRx a rebate of 79.76% or $339 in 2019.
       The consumer's health plan gets that rebate every month 
     regardless of whether the consumer pays full-price in the 
     deductible phase or pays a smaller co-insurance amount later 
     in the year.
       46brooklyn used a fictional consumer who has a deductible 
     of $1,644--a figure the Kaiser Family Foundation says is the 
     U.S. average.
       Each month, January through April, the consumer in this 
     scenario would pay close to the full list price for insulin, 
     $408 in this case based on retail price data. Those same 
     months, the health plan, paying $0 toward the insulin, would 
     receive a $339 rebate. The manufacturer of the insulin would 
     get the difference, or $69 in this scenario.
       The rest of the year, once the consumer hit his deductible, 
     he would pay about $34 for insulin each month. The health 
     plan, after rebates, would pay about $35, giving the 
     manufacturer the same total of $69.
       At the end of the year, this fictional diabetic spent a 
     total of $1,906 for insulin while the manufacturer made $828. 
     The consumer's health plan via the PBM came out ahead, 
     profiting $1,078 after getting more than $4,000 worth of 
     rebates.
       If all the middlemen and insurance were cut out, and the 
     consumer was simply charged the net cost of the drug every 
     month, 46brooklyn argued, the consumer would save more than 
     $1,000 a year while the manufacturer would make the same 
     profit.
       A study by researchers at the University of Southern 
     California found that manufacturers, often blamed for rising 
     prices, actually make less money as list prices rise. Since 
     2014, while list prices rose by 40%, the net price that 
     manufacturers made off their insulin products decreased more 
     than 30%, according to the study published in the Journal of 
     the American Medical Association.
       The PCMA disputed the accuracy of 46brooklyn's rebate 
     scenario.
       ``By cherry picking an extreme and unrealistic example of 
     high patient out-of-pocket costs, the 46brooklyn report does 
     a poor job of depicting the health care experience for most 
     insured people with diabetes,'' Lopes said. ``For example, 
     the report's out-of-pocket cost assumption is actually 
     significantly higher than the amount at which many plans set 
     or cap patient cost sharing for insulin.''
       There are consumers who reported paying $400 out-of-pocket 
     for a month's supply of insulin after insurance. Rod Regalado 
     is one of them.


                           A father's crusade

       Regalado had never heard of a pharmacy benefit manager 
     before two years ago.
       That's when his son Matt, then 14, was diagnosed with Type 
     1 diabetes and Regalado got a crash course in insulin 
     pricing.
       His first trip to the pharmacy when his son was released 
     from a hospital came with a $1,000 price tag for all the 
     testing supplies and insulin he'd never purchased before. The 
     next month, when all he had to do was buy more insulin, the 
     price was still north of $400 after insurance.
       The single dad of two said he thought he had good insurance 
     until he found himself having to redo his entire household 
     budget to afford insulin.
       ``I thought how do people do this?'' he said.
       The resident of Tekamah, Nebraska, started making calls to 
     his insurance, pharmacy and doctors, trying to figure out a 
     way to lower his out-of-pocket costs. Then he called his 
     congressman.
       ``The harsh reality is that the cost of insulin is 
     artificially high and ever-escalating,'' U.S. Rep. Jeff 
     Fortenberry, R-Neb., said in July when he and Rep. Angie 
     Craig, D-Minn., reintroduced their bill aimed at capping 
     prices. ``Matt's Act makes insulin prices fair for everyone 
     by capping the price at $60 a vial and $20 a vial for those 
     on insurance.''
       Though legislative efforts have focused on capping out-of-
     pocket costs, there has been a push to eliminate rebates 
     altogether and drive down list prices across the market. That 
     would require the buy-in of all parts of the drug supply 
     chain.
       Some PBMs have created formularies that don't require 
     rebates, but they struggle to get health plans to adopt them. 
     The insurers have come to expect and rely on the money from 
     rebates, and some have them written into their PBM contracts.


                           `A momentous day'

       Ciaccia of 46brooklyn pointed to the new insulin product 
     Semglee as an example of how dysfunctional the marketplace 
     can be.
       In July, the FDA approved Semglee as the first 
     interchangeable biosimilar insulin product. Biosimilars are 
     like generic drugs in that they can be substituted at the 
     pharmacy counter without needing a separate prescription.
       Semglee is interchangeable with Lantus.
       More biosimilars are likely to gain approval in the next 
     few years. They've been touted as game changers that will 
     lead to lower prices and more options for patients.
       Acting FDA Commissioner Janet Woodcock called it ``a 
     momentous day'' for people who depend on insulin. 
     ``Biosimilar and interchangeable biosimilar products have the 
     potential to greatly reduce health care costs,'' she said.
       Biocon and Viatris, the makers of Semglee, launched two 
     different versions of the drug--the branded one called 
     Semglee and a nonbranded version called insulin glargine.
       The nonbranded version's list price is about $148 for a 
     package of five 3-ml pens, which is 65% cheaper than Lantus.
       There is indication that the largest PBMs in the country 
     won't carry that version on their preferred drug formularies, 
     instead offering the branded Semglee, which has a reported 
     list price of $404 per package of five. That makes it only 
     slightly cheaper than Lantus at $425.

  The ACTING PRESIDENT pro tempore. The Republican whip.
  Mr. THUNE. Mr. President, I ask unanimous consent that I be able to 
complete my remarks prior to the vote.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.