As you may recall, back in March of this year, Eli Lilly announced that they would begin to manufacture and sell an authorized generic version (named “Lispro”) of their flagship product Humalog, priced at a 50% discount to brand name Humalog. See the original release here.
As a reminder, an “authorized generic” is an identical version of a brand drug that is launched with the knowledge and approval of the brand drug patent holder, typically via a licensing agreement with a competitor, for strategic purposes. In this case the patent holder, Eli Lilly, is launching both versions itself.
Lispro hasn’t made it to pharmacy shelves yet, but our sources indicate that pharmacies may be able to begin purchasing it as early as next week.
We anticipate that, because of the 50% lower list price, Lispro will not receive a rebate, while Humalog will continue to be rebate eligible. The value of the lower list price will have the following member impacts:
- For Rx plans with coinsurance, or HDHP, members will pay less with Lispro than with Humalog.
- For Rx plans with flat co-pays, members will be indifferent as both Humalog and Lispro will have brand co-pays.
For plans, we anticipate the following impacts:
- For a true net cost comparison between the two versions, the difference between the 50% lower list price of Lispro will have to be compared to the cost, net of rebates/rebate guarantees of Humalog.
- The willingness/ability of PBMs/Carriers to provide this level of detailed analysis in a timely fashion will likely vary.
- Generally speaking, no Rx plan should cover both products equally. The choice of Humalog as the preferred product will likely not disrupt the status quo, and current rebate guarantees will likely continue as is. The choice of Lispro as the preferred product will likely disrupt current rebate guarantees, requiring a detailed analysis of the overall impact of this choice both to the diabetes category and overall.
- We expect that many PBMs/Carriers will have a default preference for the “Humalog as preferred” option, owing to the materiality of the rebates involved. Because of the rebate impact Lispro may be excluded from coverage.
We have heard from a couple of PBM/Carriers (specifically UHC/Optum Rx and Express Scripts) on their respective strategies, and we can discuss those with you individually to assist you in making the best choice in this high-impact category.