California will produce its own $30 insulin. Next up: a drug to reverse fentanyl overdoses

Four years after Gov. Gavin Newsom signed an executive order vowing to reduce prescription drug costs in California, the state is bringing $30 insulin to Californians — and working to create its own overdose-reversing drug.

The Newsom administration announced Saturday that California secured a contract with the nonprofit drug manufacturer Civica to sell insulin through the state’s generic drug label, CalRx, at just 10% of the typical cost for cash-paying patients.

The governor is hoping to build off this momentum to address another public health crisis — fentanyl overdoses. Newsom said the state is exploring the ability to manufacture its own overdose-reversing drug, Naloxone, which is sold under several brand names, including Narcan.

“People should not be forced to go into debt to get life-saving prescriptions,” Newsom said in a statement. “Through CalRx, Californians will have access to some of the most inexpensive insulin available, helping them save thousands each year.

“But we’re not stopping there – California will seek to make our own Naloxone as part of our plan to fight the fentanyl crisis.”

The announcements come amid rising public anger over both the nation’s opioid crisis and the exorbitant cost of life-saving drugs like insulin. Two of the world’s largest insulin manufacturers — Eli Lilly and Novo Nordisk — recently announced plans to drastically reduce the cost of their drugs after repeated calls from President Biden, lawmakers and advocates.

“To address the affordability crisis in California, we have to address the high cost of prescription drugs,” Mark Ghaly, secretary of the California Health and Human Services Agency said in a statement.

High insulin costs hurt Diabetes patients who need it

More than 30 million Americans are diagnosed with diabetes, which hinders the body’s ability to naturally produce insulin, leading to dangerous levels of blood sugar. Over 7 million people require insulin on a daily basis. Over the last decade, the cost has skyrocketed to a point where nearly 1 in 5 Americans with diabetes ration the life-saving drug, according to a recent study published in the Annals of Internal Medicine.

Kevin Wren knows first-hand the dangers of insulin rationing — when diabetics who can’t afford insulin cut back on their intake to make it last longer.

“You feel physically terrible — sick, lethargic, sleepy, really spacey,” Wren said. “It sucks.”

The Sacramento resident was diagnosed with Type 1 diabetes in 2001 at age 15. Thanks to his family’s robust health insurance, he didn’t have to worry about affording his medication or supplies throughout high school and college.

But after he graduated from Seattle University in 2008, Wren struggled for more than six months to find full-time work with benefits that would help him afford his life-saving medication.

“I was just trying to like, make it work and not die,” Wren said. “It’s pay or die.”

Wren volunteers as California chapter leader for Insulin 4 All through T1 International, a patient-led group that raises awareness about Type 1 diabetes and advocates for policies to benefit patients. He’s currently unemployed and on Medi-Cal, which covers all his costs associated with diabetes care. Wren estimates his supplies — including two different insulin types, glucose monitoring strips, and needles — cost upwards of $2,500 a month.

A generic alternative would benefit all diabetes patients, Wren said, but uninsured people who pay out-of-pocket or those with high deductibles would gain the greatest benefit.

California reaches $100 million contract for generic insulin

The state budget passed last July set aside $100 million to produce a cheaper insulin product by cutting out drug makers and other companies that contribute to the elevated price tags. As part of the plan, $50 million was allocated for the development of low-cost insulin products, and the other $50 million was earmarked for construction of a California-based manufacturing facility.

Civica, based in Utah, was awarded the $100 million state contract and is working with the California Health and Human Services Agency to identify a potential California-based facility, the statement from Newsom’s office said.

Under the contract, the price of a 10 mL vial of insulin will be capped at $30. A box of five 3 mL insulin pens will cost no more than $55. Out-of-pocket expenses for brand-name options run as high as $300 and $550 respectively, the statement said.

The governor’s office has not announced when the insulin products will be available for patients. A copy of the contract was not immediately available.

When the insulin is ready for purchase, insulin-dependent patients will be able to ask for the CalRx products at their pharmacies without a new prescription. CalRx plans to make insulin products comparable to the drugs Glargine, Aspart and Lispro, also known under their brand names of Lantus, Humalog, and Novolog, according to the release.

Shawndra Ashen, 57, of Sacramento, cheered the governor’s announcement.

Ashen, who was diagnosed with Type 1 diabetes at age 8, now has insurance that covers her insulin products but that wasn’t always the case. As a child, Ashen’s parents paid out-of-pocket for her medications. Then as a young adult, she went into thousands of dollars of debt for her medical needs.

“The greed of pharmaceutical companies is disgusting to me,” she said about alarmingly high costs for lifesaving drugs like insulin.

Having a cheaper alternative at the time would have likely made a big difference, Ashen said.

“I think it’s amazing,” she said. “I’m just so happy for everyone who’s going to be able to get what they need and not go into debt like that.”

Maggie Angst covers California politics and Gov. Gavin Newsom for The Sacramento Bee. Before joining The Bee’s Capitol Bureau, she worked for the Mercury News and East Bay Times where she covered San Jose City Hall and later wrote enterprise stories on the breaking news team.

Maya Miller writes about economic mobility and affordability for The Sacramento Bee’s Capitol Bureau. She previously covered business for The Seattle Times and holds a degree in public policy from Duke University.

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