California will develop its own low-cost insulin: Newsom

California Governor. Gavin Newsom, the governor of California announced Thursday that it will create its own low-cost insulin. This is an essential hormone many people rely upon to manage their diabetes. It makes the state one of the most innovative in the nation.

In a video shared on Twitter, he said that “people should not go into debt to receive life-saving medication.”

“Many Americans experience out-of-pocket costs anywhere from $300 to $500 per month for this life-saving drug,” he said. California is taking the matter into its own hands. The budget I just signed sets aside $100 million so we can contract and make our own insulin at a cheaper price, close to at cost, and make it available to all.”

Newsom last week signed a $308 billion state budget. He said on Thursday that $50 million in the budget will go toward developing low-cost insulin products and another $50 million “will go towards a California-based insulin manufacturing facility” that he says will “provide new, high paying jobs and a stronger supply chain” for the diabetes medication.

An insulin kit. (Kerem Yucel/AFP via Getty Images)

Millions of diabetics, who cannot produce insulin or do not respond to insulin, inject insulin with the synthetic insulin version to maintain normal blood sugar levels and prevent multiple complications.

Of the 37 million people in the United States who have diabetes, about 8.4 million use insulin, according to the American Diabetes Association. The medical costs for diabetes sufferers in America are twice as high than those of people who don’t have diabetes. In fact, one third of Medicare dollars is spent on diabetes treatment.

Earlier in the month, Senators introduced an insulin bill that would allow Congress to limit insulin prices. Senate Majority Leader Chuck Schumer, D-N.Y., praised the bill. It was introduced by co-chairs from the U.S. Senate Diabetes Caucus. Susan Collins (R-Maine) and Jeanne Shaheen (D-N.H.), and said he would bring it to a vote on the Senate floor “very soon.” The bill, if passed, would take effect for those with coverage on Jan. 1, 2024.

While the price of insulin tends to fall over time, it continues to increase in cost for consumers. Three companies–Sanofi SA, Eli Lilly and Co., and Novo Nordisk–own some 90 percent of the market for insulin, which was first isolated in the 1920s.

About one in five insured Americans pay more than $35 per month for the treatment, while the rest pay about $23 per month, according to a 2021 report on drug prices by health information company IQVIA.

The Trump administration previously announced a program in May 2020 to cap the price of insulin for many Medicare recipients. The program went into effect in January 2021 and remains in place. Under the program, more than 1,750 Medicare Part D and Medicare Advantage plans have voluntarily capped the co-payments for insulin at $35 per month.

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