Implication Vs. Facts

Implication Vs. Facts

It seems that you can’t swing a dead cat these days without seeing another article or study about the “rising” cost of insulin. How the “list” price of insulin has been rising. However, Diabetic Investor has yet to read an article or clinical study that shows a link between the “rising” cost of insulin and patient outcomes. The implication of these articles and studies is that there is such a correlation, that since the cost of insulin is “rising” that patients are being adversely impacted. But as the old Wendy’s commercial used to say; “Where’s the beef?”

Now before we delve deeper into this topic let’s first ty and clarify a few things, which to be honest, will not be easy. First and foremost, we need to define what the real cost of insulin actually is.  Is it what the patient actually pays out of pocket, i.e. the co-payment or in the case of non or underinsured patients what the pharmacy charges them? Or is the cost we’re talking about here what a payor pays to Lilly (NYSE: LLY), Novo Nordisk (NYSE: NVO) or Sanofi (NYSE: SNY)? Or are we talking about the list price of insulin BEFORE rebates/discounts are taken into account? Is not the NET EFFECTIVE SELLING price (list price less rebates and discounts) what matters?

Not to get even more complicated but what about the margin the pharmacy adds in? According to the GoodRx web site the retail cost for one vial of Novolog ranges from $189.90 (Walgreens) to $258.24 (Kmart and Safeway). Are these retailers not building a profit into their prices?

Want to get even more complex try and figure out how what the payor pays for insulin factors into a patient’s co-payment. There is amble evidence that patient’s co-payments have been rising over the last few years. However, is this a direct result of the “rising” cost of insulin or are employers looking to lower premiums by transferring a greater share of the cost to patients?

If this hasn’t made your head spin yet, consider this- are companies like Lilly or Novo to be blamed when a patient CHOOSES a health plan that carries high deductibles or higher co-payments? Don’t all the insulin companies offer some sort of patient assistance programs for patients who cannot afford the cost of insulin?

We told you this wouldn’t be easy but wait it gets even crazier.

Let’s just assume for a moment everyone agrees on exactly what the term cost means, is there any hard evidence that shows the “rising” cost of insulin is adversely impacting patient outcomes. Is this even possible? How for example would we know that the patient is properly dosing their insulin? How would we know that the patient is compliant with their therapy regimen? Is it even possible with all the factors/variables that go into patient outcomes to single out the “rising” cost of insulin as the reason patient outcomes are adversely impacted?

Perhaps a better way to think about this is to look at this from the opposite perspective; would patient outcomes improve if insulin was given away for FREE. That’s right no co-payments, no worries about deductibles and no worries about finding and qualifying for assistance programs.  All the patient has to do is walk into a pharmacy, that’s it. Would this improve patient outcomes? Is it not true that all the factors/variables mentioned in the last paragraph would still come into play?

Diabetic Investor does not doubt that cost plays a role in diabetes management, however we are not yet convinced that the “rising” cost of insulin is adversely impacting outcomes. For this is the implication of every article written or study, that since the cost of insulin – however cost is defined – is “rising” that it MUST BE adversely impacting outcomes. That a direct line can be drawn from the “rising” cost of insulin to poorer patient outcomes. Again we will ask – where is the proof? Show us the study that proves that the “rising” cost of insulin is THE reason patients aren’t achieving better outcomes.

Listen everyone knows this is an election year and that the high cost of healthcare is a popular topic. Yet, we also know that it is not easy to prove that the “rising” cost of insulin impacts patient outcomes in any way. This is not to say that insulin costs aren’t “rising” or that this may influence outcomes. What we would like is some proof not an implication but actual proof.