Lilly answers Novo’s price-increase limit with new discount plan for insulin

Eli Lilly is launching a new 40% discount program for its insulin products.

Last week, Novo Nordisk became the second company, after Allergan, to vow to limit yearly price hikes to single-digit percentages. This week, Novo’s diabetes rival Eli Lilly is answering back with a similar—though somewhat less potent—pledge. 

Starting next year, Lilly will partner with pharmacy benefits manager (PBM) Express Scripts to provide discounted insulin to people who have no insurance or are in high-deductible plans. The program could save some diabetes patients as much as 40%, according to a press release from Lilly.

The discounts will be offered through Blink Health, a website and smartphone app that previously only sold generic drugs. Lilly will be the first company to offer branded drugs via the Blink platform.

"We understand the burden people face when paying full price for insulin," said Mike Mason, vice president of Lilly Diabetes in the release. "This platform will effectively allow Lilly to lower our insulin retail prices for users of this platform while not affecting the reimbursement system for other people living with diabetes."

In other words, the discounts will lower out-of-pocket costs for people who don’t have adequate health insurance, but Lilly will maintain the right to haul in high prices on any insulin product purchased by the majority of patients who are insured by their employers. That’s not quite the same as Novo’s price-increase promise or Allergan’s similar “social contract,” in which the company vowed in September that it would raise prices on all its drugs only once a year and by no more than single-digit percentages.

RELATED: Novo Nordisk vows to limit price hikes, stepping up pressure on its pharma rivals

A spokesman for Lilly did not respond to a request for comment. Express Scripts acknowledged in a statement that the insulin program is specifically geared to people who otherwise would struggle to pay for the drug. “To solve the challenge of diabetes, it will take inventive programs such as this one to ensure broader access, especially for those who typically go without,” Express Scripts said.

Drugmakers will most certainly face continued pressure from both the public and private sector to lower prices. Despite the initial “Trump bump” that sent biopharma stocks soaring in the days following the election—on predictions that the businessman-turned-commander-in-chief wouldn’t crack down on the industry—the demands for lower prices just keep coming. Last month, for example, Medicare published new formularies that offered reduced coverage for Novo’s basal insulins. 

Lilly and Boehringer Ingelheim are gearing up to launch Basaglar, their biosimilar version of Sanofi blockbuster Lantus, but for now, Medicare Part D isn’t including the less expensive copycat in its formularies. Basaglar will be included in Lilly’s new discount program, as will its older blockbusters Humalog and Humlin.

Now Trump himself is jumping on the drug-price bandwagon. In an interview with Time published last week, he promised to “bring down drug prices,” causing formerly high-flying pharma stocks to dip.

Even though Express Scripts is an enthusiastic participant in Lilly’s new discount program, the PBM continues to speak out on the need for more self-policing by the drug industry.

“Pharmaceutical companies have to demonstrate more rational drug pricing,” wrote Steve Miller, the company’s chief medical officer, in a recent blog post. “They deserve to be rewarded for innovation, but at prices the marketplace can afford, not what it will bear.”