Richard Davis: Insulin vultures


It is clear that something needs to change when heroin is one of the cheapest drugs on American streets because the system of market forces is working so well compared to the system of prescription drug pricing.

I can go to any street corner in America and buy a "dose" of heroin for $10 or less while it will cost me $80 dollars to buy one Oxycontin pill from the same dealer. The cost of the pill at a pharmacy is no bargain either.

Street dealers have more control over heroin pricing than they do for the prescription drugs they divert from legal channels. But because heroin is so much cheaper and available, opting for one of the most deadly street drugs is a no-brainer decision.

The difference between the pricing of heroin and that of prescription drugs has to do, in large part, to the nearly invisible army of pharmacy benefit managers. One website describing their role defines them well. "Pharmacy benefit managers, or PBMs, act as an intermediary between the payer and everyone else in the healthcare system. They generally make money through service fees from large customer contracts for processing prescription claims, operating mail order pharmacies, and negotiating prices with drug makers. PBMs are largely unrecognized by most employees — and even many employers and human resource managers. But they have a tremendous impact on U.S. health care decision-making because they influence more than 80 percent of drug coverage."

PBMs are the vultures of the health care industry and they have created a niche to reap profits off of the backs of the people who can afford it the least, the people who need prescription drugs to stay alive. Insulin is a good case in point.

The cost of insulin has risen nearly 200 percent between 2002 and 2013. Sure, the insulin manufacturers have developed newer and more effective products and there is plenty of greed to spread around, but the PBMs saw a must-have market and they have exploited it to the point where diabetics are struggling to buy enough insulin to prevent the horrible complications from their disease.

PBMs make deals with insulin manufacturers and then they decide how much profit they want to make before they sell their goods to the next in line, usually pharmacies. Because PBMs work for insurance companies they can decide which products the insurers will use and that translates into making decisions that directly affect diabetics.

In a recent interview on the Medscape web site with endocrinologist Dr. Irl Hirsch, he cites examples where he is not informed when some of his patients are forced to change the type of insulin they use because the PBM felt it would be a better deal for the insurance company. If this isn't practicing medicine without a license what is it? It is also a symptom of a system with perverse priorities.

This country has never moved away from the open market system when it comes to the delivery of health care. One of the most horrific results of this failed system (at least for the consumer) is that diabetics are having to use less, or no, insulin and that means it will cost all of us more in the long run and it will promote a lot of unnecessary suffering.

Lantus, a commonly used newer generation insulin, cost $12 a vial in India. A vial will last most diabetics about a month. That same vial will cost between $250 and $300 in this country. A large part of that inflated price has to do with too many profiteers along the supply chain.

It is time to out the PBMs. Do we really need these vultures of the health care world? Maybe diabetics would be better off if we put the distribution of insulin into the hands of drug cartels and street dealers. That might be the only hope for a drug that diabetics could afford.

Richard Davis is a registered nurse. He writes from Guilford and welcomes comments at


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