Sanders Grills Big Pharma CEOs Over Years of Deadly Price Gouging

U.S. Sen. Bernie Sanders on Wednesday paid his respects to the victims of insulin price gouging in front of the Big Pharma CEOs who are responsible and reiterated the need to make all lifesaving prescription drugs affordable.

Sanders (I-Vt.), chair of the Senate Committee on Health, Education, Labor, and Pensions (HELP), opened the panel’s hearing by acknowledging “the many Americans who have needlessly lost their lives because of the unaffordability of insulin” and “the thousands who wound up in emergency rooms and hospitals suffering from diabetic ketoacidosis—a very serious medical condition as a result of rationing their insulin.”

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“This is a problem that is unique to the United States.”

Diabetes—a disease that can wreak havoc on organs, eyesight, and limbs if left unmanaged—affects more than 37 million U.S. adults and is the country’s eighth leading cause of death, according to the U.S. Centers for Disease Control and Prevention. Although it costs less than $10 to produce a vial of insulin required to treat diabetes, uninsured patients in the U.S. pay nearly $300 per vial of the century-old drug because Eli Lilly and Company, Novo Nordisk, and Sanofi—the three pharmaceutical corporations that control 90% of the nation’s lucrative insulin market—charge excessive prices with little resistance from federal lawmakers.

As Sanders noted, such corporate profiteering—a problem compounded by the widespread lack of coverage under the nation’s for-profit healthcare system—forces many people to skip doses, with deadly consequences. Recent studies found that 1.3 million people in the U.S. ration insulin, including an estimated 1 in 4 people with Type 1 diabetes. People without insurance are the most likely to do so, followed by those with private insurance.

Ahead of the hearing, Sanders released a video featuring diabetes patients sharing their struggles to afford insulin in the U.S.

“Imagine just three companies having worldwide market dominance over such necessities as air and water,” Steve Knievel, an advocate with Public Citizen’s access to medicines program, said Wednesday in a statement. “This is what people with diabetes face with insulin.”

Addressing the CEOs of the three aforementioned firms during the hearing, Sanders outlined how each has jacked up prices in recent decades:

Eli Lilly increased the price of Humalog 34 times since 1996 from $21 to $275—a 1,200% increase. The same exact product. No changes at all. The only reason for the huge increase in price during that period was that there was no legislation to stop them. In America, the drug companies could charge any price they want.

But it’s not just Eli Lilly. Novo Nordisk increased the price of Novolog 28 times from $40 in 2001 to $289—a 625% increase.

And then there is Sanofi, a company that increased the price of Lantus 28 times from $35 in 2001 to $292—a 730% increase.

“In every instance it is the same exact product that rose astronomically,” said Sanders. “And let’s be clear. This is a problem that is unique to the United States. In France, 20 years ago, the cost of Lantus was $40. Today, it has gone down to just $24.”

Sanders has famously accompanied Americans with diabetes on a two-mile trip from Detroit, Michigan to Windsor, Ontario. In Canada, people can purchase the exact same insulin product for one-tenth of the price they would pay in the U.S.

“We cannot rely on limited price concessions from insulin corporations to ensure this essential resource is accessible and fairly priced for Americans who need it.”

Also in attendance at Wednesday’s hearing were the leaders of CVS Health, Express Scripts, and OptumRX, three major pharmacy benefit managers (PBMs). Sanders took them to task, noting that “as insulin manufacturers continued to increase prices, PBMs signed secret deals to increase their profits by putting insulin products on their formularies not with the lowest list price but the ones that gave PBMs the most generous rebates.”

Thanks to sustained public pressure and fresh policy changes—namely the Inflation Reduction Act’s provision limiting Medicare beneficiaries’ insulin copayments to $35 per month—Eli Lilly, Novo Nordisk, and Sanofi have all recently pledged to significantly lower the list prices for some of their insulin products. As Sanders explained:

Eli Lilly announced it would reduce the price of Humalog by 70% later this year—from $275 to $83. Eli Lilly also decreased the price of its generic Humalog to $25 per vial.

Novo Nordisk announced it would reduce the price of Novolog by 75% beginning next year—from $289 to $72.

Sanofi announced it would reduce the price of Lantus by 78% beginning next year—from $292 to $64.

While Sanders thanked the three companies for taking what he called “an important step forward,” he stressed that “we must make sure that these price reductions go into effect so that every American with diabetes gets the insulin they need at an affordable price,” vowing to “hold a hearing early next year to make certain that happens.”

Knievel, meanwhile, said that “we cannot rely on limited price concessions from insulin corporations to ensure this essential resource is accessible and fairly priced for Americans who need it, regardless of their insurance status or age.”

His message was echoed by Margarida Jorge, head of Lower Drug Prices Now.

“Certainly, these multimillion-dollar CEOs will spend their time in front of the committee patting themselves on the back for bowing to public pressure and lowering the cost of insulin,” Jorge said in a statement. “But let’s be clear, the tens of millions of Americans who cannot afford their prescription medication should not have to depend on the goodwill of greedy corporations who have repeatedly shown they care about profits more than people to bring them relief from skyrocketing prescription costs.”

Sanders and Rep. Cori Bush (D-Mo.) recently introduced the Insulin for All Act of 2023, which would cap insulin prices at $20 per vial.

Only federal legislation of this sort can “put an end to decades of price gouging that has led to preventable suffering and costs the lives of people with diabetes who need insulin to live,” Knievel emphasized.

Meanwhile, Sanders made clear that the unaffordability of insulin is part of a much broader crisis and proceeded to ask:

If Eli Lilly can lower the price of Humalog by 70%, why is it still charging the American people about $200,000 for Cyramza (CYR-AMZA) to treat stomach cancer—a drug that can be purchased in Germany for just $54,000?

If Novo Nordisk can lower the price of Novolog by 75%, why is it still charging Americans with diabetes $12,000 for Ozempic when the exact same drug can be purchased for just $2,000 in Canada?

If Sanofi can reduce the price of Lantus by 78%, why is it still charging cancer patients in America over $200,000 for Caprelsa—a drug that can be purchased in Japan for just $37,000?

“Lowering the cost of insulin is only one part of what we must accomplish,” said the senator. “This committee is determined to end the outrage in which Americans pay, by far, the highest prices in the world for virtually every brand name prescription drug on the market—whether it is a drug for cancer, heart disease, asthma, or whatever.”

“We want to know why there are Americans who are dying, or are becoming much sicker than they should, because they can’t afford the medicine they need,” he continued. “We have got to ask, how does it happen that nearly half of all new drugs cost over $150,000? How does it happen that cancer drugs which, in some cases, cost just a few dollars to manufacture are selling on the market for over $100,000?”

“Americans die, get sicker than they should, and go bankrupt because they cannot afford the outrageous cost of prescription drugs, while the drug companies and the PBMs make huge profits. That has got to change.”

“I know that our guests from the drug companies will tell us how much it costs to develop a new drug and how often the research for new cures is not successful,” said Sanders. “I get that. But what they are going to have to explain to us is why, over the past decade, 14 major pharmaceutical companies, including Eli Lilly, spent $747 billion on stock buybacks and dividends.”

“They will also have to explain how as an entire industry pharma spent $8.5 billion on lobbying and over $745 million on campaign contributions over the past 25 years to get Congress to do its bidding,” Sanders added. “Unbelievably, last year, drug companies hired over 1,700 lobbyists including the former congressional leaders of both major political parties—that’s over three pharmaceutical industry lobbyists for every member of Congress.”

In Sanders’ words, “That could well explain why we pay the highest prices for prescription drugs in the world and why today drug companies can set the price of new drugs at any level they wish.”

“While Americans pay outrageously high prices for prescription drugs, the pharmaceutical industry and the PBMs make enormous profits,” he noted. “In 2021, 10 major pharmaceutical companies in America made over $100 billion in profits—a 137% increase from the previous year. The 50 top executives in these companies received over $1.9 billion in total compensation in 2021 and are in line to receive billions more in golden parachutes once they leave their companies. Last year, the three major PBMs in America made $27.5 billion in profits—a 483% increase over the past decade. These PBMs manage 80% of all prescription drugs in America.”

“In other words, Americans die, get sicker than they should, and go bankrupt because they cannot afford the outrageous cost of prescription drugs, while the drug companies and the PBMs make huge profits,” Sanders lamented. “That has got to change and this committee is going to do everything possible to bring about that change.”

Jorge, for her part, described the Inflation Reduction Act as a “milestone” law that “will help tens of millions of seniors.”

“But it is just the start,” said Jorge. “Congress should pass legislation to bring the prescription drug reforms that are saving Medicare patients and taxpayers billions to people of all ages, so that everyone can get lower drug prices on medicines they need—including insulin.”

“Congress, not greedy corporations trying to redeem their tarnished reputations, should be leading the way on reforms that put patients ahead of pharmaceutical profits,” she added.