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The fight to lower the price of insulin in the United States may have damaged Eli Lilly’s reputation, but whether this completely explains the company’s decision to lower the price of its insulin products is another question.
Since insulin was discovered, Eli Lilly has worked to maintain control of the US market. In 1923, it argued Canada’s co-discovers should give it monopoly control in the US in order to keep the cost of the new medicine low, because “Rivalry would be rife and expensive.” 1
Nearly 60 years later, as it tested marketing strategies for its new recombinant DNA human insulin, Lilly warned that a future shortage of pancreata meant that animal insulin, over which it had monopoly control, “could likely be in very short supply in approximately 20 years”. 2
But while warning of future shortages (which turned out to be false 3), Lilly was being investigated by the US Federal Trade Commission for conspiracy to suppress competition in the market for pancreas glands and finished insulin. The FTC found that Lilly’s actions had “expressly precluded other insulin manufacturers from entering the United States,” and that the company had “willfully maintained its monopoly power.” 4
More recently, Eli Lilly, Novo Nordisk and Sanofi have faced lawsuits for conspiring “to drive up the costs of insulin to increase revenues” 5; legislative attempts to cap prices 6; and now the emergence of nonprofit companies partnering with US states to sell this essential medicine at far below prices being exacted by the Big Three producers. 7
Given its track record, it’s worth asking whether Eli Lilly’s decision to lower prices is a sincere response to the pain and anguish experienced by American diabetics – or whether it’s playing a much longer game to protect its oversized share of the insulin market by undercutting emerging nonprofit competitors. 8
Americans, just like the rest of us, need legislated and effective price controls for insulin (and all medicines), not self-serving handouts from the pharmaceutical industry. It’s time to bring the issue of public, nonprofit manufacturing into the public debate about insulin access and affordability.
Footnotes
1 Letter from J.K. Lilly, Sr., President of Eli Lilly & Co., to George HA Clowes, Director of Research, on the subject of “The New Pancreatic Principle”. January 3, 1923. University of Toronto, Insulin Library, https://insulin.library.utoronto.ca/islandora/object/insulin%3AL10241#pa...
2 A study of insulin supply and demand (1978). A report of the National Diabetes Advisory Board. US Department of Health Education and Welfare; Publication No. (NIH) 78-1588, Washington DC.
3 Eli Lilly, July 21, 1980. PR Newswire.
4 United States Federal Trade Commission: Complaint in the Matter of Eli Lilly and Company. Consent Order, etc., in regard to alleged violations of Sec. 5 of the Federal Trade Commission Act and Sec. 7 of the Clayton Act. Docket C-3021. Complaint, April 29, 1980; Decision April 29, 1980. Available at https://www.ftc.gov/sites/default/files/documents/commission_decision_vo...
5 “Eli Lilly, Novo Nordisk and Sanofi face new lawsuit from Arkansas attorney general over insulin prices,” Zoey Becker, May 12 2022, Fierce Pharma. Available at https://www.fiercepharma.com/pharma/arkansas-files-lawsuit-against-eli-l...
6 Sayed, BA, Finegold, K, Olsen, TA, De Lew, N, Sheingold, S, Ashok, K, Sommers, BD. Insulin Affordability and the Inflation Reduction Act: Medicare Beneficiary Savings by State and Demographics. (Issue Brief No. HP-2023-02). Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services. January 2023.
7 Civica to Manufacture and Distribute Affordable Insulin. CivicaRx News Release, March 3, 2022. Available at https://civicarx.org/civica-to-manufacture-and-distribute-affordable-ins...
8 "Insulin update: Price cuts ... for now," by Merrill Goozner, GozzNews Substack, March 4, 2023. Available at https://gooznews.substack.com/p/insulin-update-price-cuts-for-now
Re: Insulin: Eli Lilly cuts price to $35 a month in US after pleas from patients and president
Dear Editor,
The fight to lower the price of insulin in the United States may have damaged Eli Lilly’s reputation, but whether this completely explains the company’s decision to lower the price of its insulin products is another question.
Since insulin was discovered, Eli Lilly has worked to maintain control of the US market. In 1923, it argued Canada’s co-discovers should give it monopoly control in the US in order to keep the cost of the new medicine low, because “Rivalry would be rife and expensive.” 1
Nearly 60 years later, as it tested marketing strategies for its new recombinant DNA human insulin, Lilly warned that a future shortage of pancreata meant that animal insulin, over which it had monopoly control, “could likely be in very short supply in approximately 20 years”. 2
But while warning of future shortages (which turned out to be false 3), Lilly was being investigated by the US Federal Trade Commission for conspiracy to suppress competition in the market for pancreas glands and finished insulin. The FTC found that Lilly’s actions had “expressly precluded other insulin manufacturers from entering the United States,” and that the company had “willfully maintained its monopoly power.” 4
More recently, Eli Lilly, Novo Nordisk and Sanofi have faced lawsuits for conspiring “to drive up the costs of insulin to increase revenues” 5; legislative attempts to cap prices 6; and now the emergence of nonprofit companies partnering with US states to sell this essential medicine at far below prices being exacted by the Big Three producers. 7
Given its track record, it’s worth asking whether Eli Lilly’s decision to lower prices is a sincere response to the pain and anguish experienced by American diabetics – or whether it’s playing a much longer game to protect its oversized share of the insulin market by undercutting emerging nonprofit competitors. 8
Americans, just like the rest of us, need legislated and effective price controls for insulin (and all medicines), not self-serving handouts from the pharmaceutical industry. It’s time to bring the issue of public, nonprofit manufacturing into the public debate about insulin access and affordability.
Footnotes
1 Letter from J.K. Lilly, Sr., President of Eli Lilly & Co., to George HA Clowes, Director of Research, on the subject of “The New Pancreatic Principle”. January 3, 1923. University of Toronto, Insulin Library, https://insulin.library.utoronto.ca/islandora/object/insulin%3AL10241#pa...
2 A study of insulin supply and demand (1978). A report of the National Diabetes Advisory Board. US Department of Health Education and Welfare; Publication No. (NIH) 78-1588, Washington DC.
3 Eli Lilly, July 21, 1980. PR Newswire.
4 United States Federal Trade Commission: Complaint in the Matter of Eli Lilly and Company. Consent Order, etc., in regard to alleged violations of Sec. 5 of the Federal Trade Commission Act and Sec. 7 of the Clayton Act. Docket C-3021. Complaint, April 29, 1980; Decision April 29, 1980. Available at https://www.ftc.gov/sites/default/files/documents/commission_decision_vo...
5 “Eli Lilly, Novo Nordisk and Sanofi face new lawsuit from Arkansas attorney general over insulin prices,” Zoey Becker, May 12 2022, Fierce Pharma. Available at https://www.fiercepharma.com/pharma/arkansas-files-lawsuit-against-eli-l...
6 Sayed, BA, Finegold, K, Olsen, TA, De Lew, N, Sheingold, S, Ashok, K, Sommers, BD. Insulin Affordability and the Inflation Reduction Act: Medicare Beneficiary Savings by State and Demographics. (Issue Brief No. HP-2023-02). Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services. January 2023.
7 Civica to Manufacture and Distribute Affordable Insulin. CivicaRx News Release, March 3, 2022. Available at https://civicarx.org/civica-to-manufacture-and-distribute-affordable-ins...
8 "Insulin update: Price cuts ... for now," by Merrill Goozner, GozzNews Substack, March 4, 2023. Available at https://gooznews.substack.com/p/insulin-update-price-cuts-for-now
Competing interests: No competing interests