Home Recent Breaking News: Novo Nordisk Stands Firm on High Pricing of Diabetes Drugs in USA

Breaking News: Novo Nordisk Stands Firm on High Pricing of Diabetes Drugs in USA

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Breaking News: Novo Nordisk Stands Firm on High Pricing of Diabetes Drugs in USA
Novo Nordick San Luis

Bernie Sanders made a name for himself when he nearly upset former Senator Hillary Rodham Clinton’s plans to run for presidency. Having gracefully exited from the presidential race, he is now challenging a different contender – the pharmaceutical giants of diabetes drugs!

The 3 main pharmaceutical companies that market diabetes drugs and insulin are Sanofi, Novo Nordisk and Eli Lilly.

On Thursday, November 3, 2016, US senator Bernie Sanders and Representative Elijah Cummings demanded an investigation by federal antitrust regulators into the price hikes of diabetes drugs.

They suggested that the 3 pharma companies were working in cohorts in the price hike of the drugs.

What the 2 politicians noted was that the spike in prices and the timing of the price hikes of diabetes drugs from each of the companies appeared to be similar. And this is despite the fact that patent on insulin expired 75 years ago.

But a day later, November 4, 2016, Novo Nordisk defended its price hike and denied any collusion with the other pharma companies on the hike in prices.

Their explanation is that to display their product in the market, they need to get into the list of products that obtain subsidies from the insurance companies. In order to get into the product list of the insurance companies, the pharma companies have to provide good rebates.

The rebates are conveyed to the middlemen that bridge the gap between the pharma companies and the insurance firms. The middlemen or the pharmacy benefit managers (PBM) try to get the best rebates from pharma companies so they can offer these drugs to the different insurance health plans or other employers.

Novo Nordisk maintained that they offered 55% of rebates in diabetes drugs to PBMs in the United States this year alone.

Representatives from Eli Lilly and Sanofi have maintained that their price hikes are independent of each other stating that the market for insulin is very competitive.

Other generic companies, such as Allergan Plc, Mylan N.V., Endo International Plc, all saw a drop in the prices of their shares in the stock market. These companies do not market insulin but sell other diabetes drugs. Due to the impending charges of the Justice Department, there are fluctuations in the share prices.

Yet, the major players, Novo Nordisk, Eli Lilly, and Sanofi are under the scanner and it remains to be seen what will come out of the investigations. 

Consumers will certainly hope for lower drug prices to deal with the chronic condition of diabetes. In the web of science, profits, and patents, one can only hope for a break in the price hike of drugs and a respite for the average diabetic patient.