New Milliman Analysis Finds Insulin Costs 20% Less Today than in 2007

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Drugmaker rebates, discounts and other payments significantly lower costs of insulin, but savings often not shared with patients

WASHINGTON, D.C. (December 15, 2021) – A new report released by Milliman and commissioned by the Pharmaceutical Research and Manufacturers of America (PhRMA) finds that rebates, discounts and other payments from biopharmaceutical companies to pharmacy benefit managers (PBMs), insurers, the government and others, lowered the cost of the most commonly used insulins by 84% on average in 2021. The report further finds that the average net cost of the most commonly used insulins is 20% lower today than in 2007.

Unfortunately, it doesn’t feel that way for many patients. According to the report, “the way pharmaceutical reimbursement works in the U.S., the gap between gross and net prices for insulins does not result in direct savings for patients at the pharmacy counter."

PhRMA President and CEO Stephen J. Ubl said, “This report is further proof that the rebates and discounts paid by biopharmaceutical companies significantly lower the costs of medicines. But too often, these savings are not shared with patients. Unfortunately, the current drug pricing bill fails to take a holistic approach to addressing a system that drives affordability challenges for patients. By taking steps to hold middlemen accountable, Congress can help fix a broken system and lower patient costs at the pharmacy counter.”

The report also found:

Plan sponsors pay less for insulin today than they did in 2007. The average annual net cost for the most commonly used insulins decreased by 20% over the study period, from $1,319 per year in Q1 2007 to $1,055 per year in Q1 2021.
Manufacturer rebates, discounts and other payments have grown significantly. In 2021, rebates, discounts, and other payments reduced the cost of the most commonly used insulins by 84% on average, up from 17% in 2007.
Insulin products have continued to come to market, driving further competition among brand insulins, follow-on insulins and authorized generics, and helping to lower net prices.
The report references a publication from Drug Channels and summarizes that “PBMs have been found to favor products with high list prices and large rebates over lower-list price equivalents.”

Learn more at PhRMA.org/cost.

Press Release

Cost and Value