California to Manufacture Insulin, But Availability Date Remains Unclear

California Gov. Gavin Newsom (Dem.) announced on Thursday, July 7, that the state will begin manufacturing its own insulin to combat medical debt and protect the lives of diabetes patients. The state-funded generic insulin could help drive down the average cost of insulin.

The cost of insulin is burdensome for many Americans, who must shell out upwards of $1,000 or more per month out of pocket. Combined with record-high inflation and the fact that eight percent of Californians have medical debt, insulin is eating at pockets—and Newsom agrees.

Newsom announced in a video posted on his Twitter account, “On my first day in office, I signed an executive order to put California on the path to creating our own prescription drugs. [...] California is going to make its own insulin.”

He adds, “Nothing epitomizes market failures more than the cost of insulin. Many Americans experience out-of-pocket costs anywhere from $300 to $500 per month for this life-saving drug. [...] The budget I just signed sets aside $100 million so we can contract and make our own insulin at a cheaper price, close to at-cost, and make it available to all.”

Newsom says the state is reserving half of the budget for the development of low-cost insulin products and the other half for an in-state insulin manufacturing facility.

Before California is able to make its own insulin, it will first need to construct and prepare the manufacturing facility that makes up half of its reserved budget. That process is likely to take a couple of years, so the start to manufacturing is down the line.

It’s unclear whether the state will contract a third-party manufacturing facility in the meantime, but that’s unlikely given the monopolization in the synthetic insulin industry that has driven up prices so much in the last few years.

California’s move to manufacture its own generic insulin will likely result in more competitive pricing across the industry, which is currently spearheaded by big pharmaceutical companies Eli Lilly, Novo Nordisk, and Sanofi. Insulin rationing due to high prices is a major threat to human lives.

In 2018, Eli Lilly’s Humalog insulin product cost $275, up 680 percent over the course of 22 years. According to a study from the Human Rights Watch, “Almost every insulin-dependent person [...] interviewed said they had rationed analog insulin because of out-of-pocket costs, taking it in ways not recommended by their physician in order to stretch their supply.”

In 2019, nearly half of all deaths directly caused by diabetes were in people under 70 years of age.

California will likely want to get moving quickly on the insulin manufacturing process, but Newsom has yet to provide an expected completion date for the project. Californians should stay tuned for updates on this project in progress.