Why a lifesaving drug that's been around since 1923 is still unaffordable

An essential drug that has been on the market for decades still has a sticker price out of range for some patients who need it.

Insulin, a life-saving treatment for diabetes, was first patented in 1923. Unlike many common, even newer medicines, a generic option does not exist. At the same time, the cost of insulin has more than tripled. According to a 2016 analysis in the Journal of the American Medical Association, in 2002, the cost per patient per year was $231. In 2013, it was closer to $736.

Today, almost 22 million Americans are diagnosed diabetics. Of those, about 26% take insulin to manage the chronic disease. (The rest take pills only or no medication at all.)

The reasons these Americans don't have a cheaper option for insulin by now isn't simple. It has a lot to do with biology and regulations. Those issues are compounded by historical and economic factors, a 2015 paper in the New England Journal of Medicine reported.

Insulin's biology makes it tricky to copy

Typically, new prescription drugs are available only from the company that developed and patented them for the first few years after gaining FDA approval. The brand name drug is allowed to monopolize the field so drug companies have incentive to invest heavily in research and come up with new medicines.

After a few years, however, other companies are allowed to start making generic versions of the drug - cheaper, "off-brand" options that are otherwise exactly the same as the original. Because there's no longer a monopoly and generic manufacturers are only trying to turn a profit - not recoup high research and development costs - generics can be much less expensive and thus more accessible treatment options for the general public.

But insulin didn't follow that trajectory.

Insulin is a hormone made by the pancreas that makes it possible for the body to absorb and process sugar from food. Researchers first figured out how to manufacture it in animal pancreases back in the 1920s so that it could be injected into people who weren't making enough. Next, human insulin was produced using recombinant DNA technology that made bacteria into mini insulin factories, so people could take human insulin instead of animal forms. The most recent innovations are insulin analogues, slight variations on human insulin to make the injected treatment act more like the insulin naturally produced and regulated by the body.

But because it's made of living cells, it's what doctors call a biologic product, and it's more complicated and difficult to manufacture than the medicines most often produced generically.

So a "generic" version of insulin would be something called a biosimilar. Unlike generics for chemical-based drugs (think antibiotics or birth control pills) that can be interchangeable with branded versions, the copy-cats of biologic medications, which are produced using living cells, have a few more caveats because the drugs might have different reactions in your body.

Getting a biosimilar insulin approved is more difficult than getting a generic of a simpler drug approved, study coauthor Kevin Riggs explained to Business Insider in 2015.

"Scientifically it's harder to point to generic copy of insulin and say this is the same," Riggs said.

But, companies have done it. There are currently two biosimilars that have gotten approved by the FDA, and CVS Health said in August that it would only cover Basaglar, a drug that's considered a biosimilar to the insulin Lantus in Europe and approved in the US, starting in 2017.

The biology of the drug isn't the only reason we don't have cheaper versions of insulin

The NEJM paper detailed years of "incremental innovation" of insulin - substantial tweaks to the product by various companies that truly improved it, but kept the latest and greatest version under patent protection until 2014. This happens with a lot of drugs, and it's a subject of much debate.

"The real question is, do those improvements do what they actually offer? Are they really innovative?" Ameet Sarpatwari, an epidemiologist at Brigham and Women's Hospital told Business Insider on Tuesday.

With each subsequent innovation, older but still effective versions of insulin that could have been produced and sold more cheaply fell out of use.

Economic implications

That's not to say newer forms of insulin don't have benefits to offset their heftier price tag.

A review published in 2008 in the American Journal of Managed Care showed insulin analogues were more cost-effective than other treatment options in the long run. They worked a bit better than unmodified human insulin, and were less unpleasant for patients to use. Though prescriptions for insulin analogues were more expensive than unmodified human insulin, the review concluded they reduced later costs of patients being hospitalized with complications from diabetes that wasn't well managed.

But individual patients and their particular situations can get lost in large studies that look at population-wide cost-effectiveness. For patients without health insurance, insulin is prohibitively expensive. Earlier iterations of insulin would be good choices for a lot of individuals if they were available more cheaply, the NEJM paper's authors argued.

"What would have been better is if as newer versions came on market the older version became generic and gave people more choice," Riggs said in an interview with Business Insider.

What's ahead?

Now that patents on the latest insulin products are expiring and a regulatory approval pathway exists, other options for insulin are at the US's doorstep. The one CVS Health opted to cover in 2017, Basaglar (though technically considered a "follow on" not a biosimilar), is set to launch in the US in December 2016.

The discount the drug brings won't be as drastic as a generic coming to market. When it comes to biosimilars overall, it might look more like a 30% discount than an 80 or 90% cut. But, it still could make a difference.

"Insulin is a life-saving medication," Dr. William Herman, professor of medicine and epidemiology at the University of Michigan School of Public Health told Stat in April. "There are people with type 1 diabetes who will die without insulin. And while there have been incremental benefits in insulin products, prices have been rising. So there are people who can't afford them. It's a real problem."

Ellie Kincaid contributed to an earlier version of this post.