Estimated Sustainable Cost-Based Prices for Diabetes Medicines

Key Points

Question

What could prices of insulins, sodium-glucose cotransporter 2 inhibitors (SGLT2Is), and glucagonlike peptide 1 agonists (GLP1As) be if they were closer to the cost of production?

Findings

In this economic evaluation of manufacturing costs, estimated cost-based prices per month were US $1.30 to $3.45 for SGLT2Is (except canagliflozin), and $0.75 to $72.49 for GLP1As, substantially lower than current market prices in nearly all comparisons. Twice-daily mixed human insulin NPH could cost $61 per year, while basal-bolus treatment with insulin glargine and aspart could cost $111 per year, with reusable pen formulations having the lowest estimated prices.

Meaning

The findings of this study suggest that insulins, SGLT2Is, and GLP1As can likely be manufactured for prices far below current prices, enabling wider access.

Abstract

Importance

The burden of diabetes is growing worldwide. The costs associated with diabetes put substantial pressure on patients and health budgets, especially in low- and middle-income countries. The prices of diabetes medicines are a key determinant for access, yet little is known about the association between manufacturing costs and current market prices.

Objectives

To estimate the cost of manufacturing insulins, sodium-glucose cotransporter 2 inhibitors (SGLT2Is), and glucagonlike peptide 1 agonists (GLP1As), derive sustainable cost-based prices (CBPs), and compare these with current market prices.

Design, Setting, and Participants

In this economic evaluation, the cost of manufacturing insulins, SGLT2Is, and GLP1As was modeled. Active pharmaceutical ingredient cost per unit (weighted least-squares regression model using data from a commercial database of trade shipments, data from January 1, 2016, to March 31, 2023) was combined with costs of formulation and other operating expenses, plus a profit margin with an allowance for tax, to estimate CBPs. Cost-based prices were compared with current prices in 13 countries, collected in January 2023 from public databases. Countries were selected to provide representation of different income levels and geographic regions based on the availability of public databases.

Main Outcomes and Measures

Estimated CBPs; lowest current market prices (2023 US dollars).

Results

In this economic evaluation of manufacturing costs, estimated CBPs for treatment with insulin in a reusable pen device could be as low as $96 (human insulin) or $111 (insulin analogues) per year for a basal-bolus regimen, $61 per year using twice-daily injections of mixed human insulin, and $50 (human insulin) or $72 (insulin analogues) per year for a once-daily basal insulin injection (for type 2 diabetes), including the cost of injection devices and needles. Cost-based prices ranged from $1.30 to $3.45 per month for SGLT2Is (except canagliflozin: $25.00-$46.79) and from $0.75 to $72.49 per month for GLP1As. These CBPs were substantially lower than current prices in the 13 countries surveyed.

Conclusions and Relevance

High prices limit access to newer diabetes medicines in many countries. The findings of this study suggest that robust generic and biosimilar competition could reduce prices to more affordable levels and enable expansion of diabetes treatment globally.

Abstract

This economic evaluation examines the health expenditures related to medicines used for treatment of diabetes worldwide.