California Governor Gavin Newsom is following through on promises to attack the high cost of drugs. The press release states:
Governor Gavin Newsom, as part of his tour of the State of California, announced that CalRx has secured a contract with a manufacturer (CIVICA), to make $30 insulin available to all who need it. The Governor also announced today that California will seek to manufacture its own Naloxone.
Today’s announcement makes good on Governor Newsom’s promise on his first day in office, to bring down the price of prescription drugs for Californians and increase accountability and transparency in health care. Californians can learn more about CalRX on the newly launched website.
WHAT GOVERNOR NEWSOM SAID: “People should not be forced to go into debt to get life saving prescriptions. Through CalRx, Californians will have access to some of the most inexpensive insulin available, helping them save thousands each year. But we’re not stopping there – California will seek to make our own Naloxone as part of our plan to fight the fentanyl crisis.”
WHY THIS MATTERS: Today’s announcement will bring down the price of insulin by about 90%, saving cash-paying patients between $2,000 and $4,000 annually. With CalRx, and unlike private companies, we’re getting at the underlying cost – the price is the price, and CalRx will prevent the egregious cost-shifting that happens in traditional pharmaceutical price games. It’ll cost us $30 to manufacture and distribute, and that’s how much the consumer can buy it for. You don’t need a voucher or coupon to access this price, and it’s available to everybody regardless of insurance plan. This is a crucial step in not just cutting the cost for the consumer, but cutting costs across the board in order to bring cheaper prescription drugs to all Californians.
“To address the affordability crisis in California, we have to address the high cost of prescription drugs,” said Dr. Mark Ghaly, Secretary of the California Health and Human Services Agency. “The CalRx Biosimilar Insulin Initiative will benefit Californians who are today paying too much for a medication that we know is life saving and life altering.”
- A 10mL vial will be made available for no more than $30 (normally $300)
- A box of 5 pre-filled 3mL pens will be made available for no more than $55 (normally more than $500)
- No new prescription will be needed. Californians will be able to ask for the CalRx generic at their local pharmacy or via mail order pharmacies. Pharmacies must agree to order/stock the product.
- CalRx plans to make biosimilar insulins available for: Glargine, Aspart, and Lispro (expected to be interchangeable with Lantus, Humalog, and Novolog respectively)
WHAT COMES NEXT
· As part of the State’s Master Plan to Tackle the Fentanyl Crisis, California is exploring potential next products to bring to market, like Naloxone, to aid in the State’s effort to combat fentanyl overdoses.
· CIVICA is working with the California Health and Human Services Agency to identify a California-based manufacturing facility.
The CalRX website states, in part:
CalRx represents a groundbreaking solution for addressing drug affordability. Originally announced in January 2019 in Governor Newsom’s first Executive Order(this is a pdf file) and later signed into law in the California Affordable Drug Manufacturing Act of 2020 (Pan, SB 852, Chapter 207, Statutes of 2020), CalRx empowers the State of California to develop, produce, and distribute generic drugs and sell them at low cost.
The State will target prescription drugs where the pharmaceutical market has failed to lower drug costs, even when a generic or biosimilar medication is available.
The first drug manufactured will be insulin. Once approved by the FDA, Californians can ask their doctor or pharmacist for a CalRx biosimilar insulin.
The CalRx Biosimilar Insulin Initiative will lay the groundwork for future drug projects.
Bringing CalRx products into the drug market will create more competition, which will help shift the industry from obscure, rebate-based pricing towards low, transparent pricing.
- CalRx will use transparent pricing – and set as low as possible – based on the development, production, and distribution costs.
- CalRx will develop target drugs in collaboration with the State’s public programs.
- CalRx will be available for doctors to prescribe and will be available through a variety of outlets, such as a local pharmacy or retail outlet.
- CalRx is not a coupon program. As mandated by law, CalRx will only use federally mandated rebates or discounts, not other ones.