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The Case of Life-Saving Insulin Prices

Tens of millions of American with diabetes rely on insulin to stay alive. But when it comes to prescription medications like insulin, pharmacy benefit managers – or PBMs –
put a particularly difficult strain on
patients and other purchasers of

Typically, PBMs base patient cost share
on the list price of medicines, rather than
the net price after rebates have been
discounted. To understand this better,
let’s take a closer look at the cost of insulin.

A Senate Finance Committee Report on insulin
prices found that rebates to PBMs are ultimately
not helping patients save on the life-saving medication.

The bipartisan report, Examining the Factors Driving the Rising Cost of a Century Old Drug, stated the following: “As this investigation has shown, the size of rebates for the insulin therapeutic class has risen rapidly, with some PBMs securing rebates as high as 70% in recent years. However, it’s the PBM or health plan who ultimately decide a drug’s formulary placement and the patient’s cost-sharing responsibility.”

separate analysis found that the list price of one insulin product increased by 141% despite a 53% decline in net price.

Insulin US Bill copy.png

It naturally begs the question:

What are PBMs doing



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PBMs profit when

list prices are higher.



In 2019, PBMs paid as little as


per vial


What Can Be Done?

Congressional action is critical for individuals with diabetes, and recently there have been efforts to address the role PBMs play in driving up costs, as well as affordability overall. For the latter, one example would cap out-of-pocket costs of insulin products at $35 per month for people with Medicare Part D and private health plans. It’s clear that more must be done to hold PBMs accountable – a conversation that we’ll continue to lead going forward.

Additional Resources

  • PBMA Report: The full report highlights the many ways PBMs increase their profits and identifies new trends and policy solutions to address the PBM problem.

  • The National Consumers League has developed a number of resources that highlight the problem with PBMs, that lead to consumers facing an unfair advantage at the pharmacy counter.

  • USC Schaeffer Study: The study found that more than half of insulin expenditures are going to PBM middlemen.

  • BRG Report: The report takes a closer look at the flow of dollars in the pharmaceutical marketplace – demonstrating how the variety of stakeholders and myriad of rebates, discounts, fees, and other payments impact out-of-pocket costs.

News Coverage

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