California Will Make Its Own Insulin To Fight Drug’s High Prices, Newsom Says

California will start making its own affordable insulin as part of an effort to combat high drug prices for a lifesaving medication that has been made inaccessible for some Americans living with diabetes, Gov. Gavin Newsom (D) announced Thursday.

Newsom said in a video posted to Twitter that $100 million from the state budget he recently signed for 2022-2023 would be allocated for California to “contract and make our own insulin at a cheaper price, close to at cost, and to make it available to all.” Half of the $100 million would go toward the development of a “low-cost” insulin, Newsom said. The other $50 million would go toward a facility in the state to manufacture insulin that would “provide new, high-paying jobs and a stronger supply chain for the drug.”

“California is going to make its own insulin,” Newsom said in the video. “Nothing epitomizes market failures more than the cost of insulin. Many Americans experience out-of-pocket costs anywhere from $300 to $500 per month for this lifesaving drug. California is now taking matters into our own hands.”

It’s unclear when the state’s insulin would be available or how much it would cost. A spokesman with the governor’s office did not immediately respond to a request for comment early Friday.

The announcement out of California comes as top senators in Congress recently unveiled a bipartisan bill to curb the high cost of insulin, which has been decried for years by advocates, doctors and President Biden. The bill from Sens. Jeanne Shaheen (D-N.H.) and Susan Collins (R-Maine) last month would place a $35 monthly cap on the cost of insulin for patients with private insurance as well as those enrolled in Medicare, although it wouldn’t afford the same protections to the uninsured. The bill also seeks to make insulin more accessible by cracking down on previous authorization requirements that can force patients to jump through hurdles to get insurers to help pay for medications.

Despite the pledge from Senate Majority Leader Charles E. Schumer (D-N.Y.) to bring the insulin pricing bill to a vote, the legislation faces difficulty passing in the chamber, as some Republicans have previously criticized the idea of a $35 cap as a price control.

More than 37 million Americans have diabetes, according to the Centers for Disease Control and Prevention, accounting for about 11 percent of the U.S. population. Even though more than 7 million Americans with diabetes are dependent on insulin each day, some Americans have struggled to keep up with the soaring costs of the drug, according to Yale researchers.

Since diabetics typically use two or three vials of insulin per month, costs can reach more than $6,000 annually for people with no insurance, inadequate coverage or high deductibles. Some of the list prices for the drug can range from $125 to more than $500. Humalog, a branded insulin drug that cost about $21 per vial when Eli Lilly introduced it in 1996, listed at the end of last year at about $275 in the United States.

2019 study published in the medical journal JAMA Internal Medicine found that the high costs for the drug had caused an estimated 1 in every 4 people with diabetes to skip doses or ration how much they took. Black, Latinx and Native American patients, who are less likely to have insurance or the level of insurance to cover the prices, are disproportionately affected by the high costs, research shows.

California’s push to make its own insulin isn’t the first time a state or group has tried to make the drug in response to the costs.

Colorado Gov. Jared Polis (D) signed legislation in 2019 to cap insulin co-payments at $100 per month to those patients with private insurance. In response to the high costs this year, Civica Rx, the nonprofit company for a consortium of large U.S. hospitals, said in March it planned to manufacture and sell generic versions of insulin at no more than $30 per vial and $55 for five injector-pen cartridges. Civica Rx said it expects to begin selling insulin in 2024, once it completes construction of a 140,000-square-foot pharmaceutical plant in Petersburg, Va. — and if it wins licensing from the Food and Drug Administration.

Newsom signed the $308 billion state budget on June 30. Included in the budget was a $17 billion relief package to give “inflation relief” checks as high as $1,050 to residents to address concerns surrounding the nation’s highest average gas prices. The plan would also suspend California’s sales tax on diesel fuel and give additional aid for residents who need help with rent and utility bills, according to lawmakers.

California has the highest number of new diabetes cases among all states, according to the governor’s office. Ethnic minorities, the elderly, men and the poor are most affected by diabetes in California, according to the state.

The governor said in a news release last week that the budget investing $100 million in insulin is in place to “develop and manufacture low-cost biosimilar insulin products to increase insulin availability and affordability in California.”

“In California, we know people should not go into debt to receive lifesaving medication,” Newsom said in the video.


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