Washington, D.C. — Today, under pressure from the Biden administration, Eli Lilly, the producer of popular insulin medications Humalog and Humulin, pledged to reduce its insulin list prices by 70%, and will take other steps to make the medicine more affordable for diabetics.

“If Eli Lilly follows through, these price cuts will save lives and save money.” said Sara Sirota, Policy Analyst at the American Economic Liberties Project. “It’s important to recognize that this move by Eli Lilly is a direct response to the Biden administration’s policy pressure on Big Pharma, and in particular the Federal Trade Commission’s ramped up attention on insulin distribution.”

In June 2022, the Federal Trade Commission issued a unanimous policy statement criticizing pharmaceutical middlemen known as ‘pharmacy benefit managers,’ who take bribes of between 50-70% to keep prices high. By reducing list prices, Eli Lilly is establishing that it will no longer set insulin prices to maximize rebates for PBMs and other middlemen. Other policy levers also influenced this choice. The Inflation Reduction Act capped insulin at $35/month for Medicare recipients and changed rebating practices, and the state of California has begun preparations to produce its own insulin.

“We encourage the FTC and the Biden administration to expand antitrust efforts to rein in drug costs,” added Sirota. “PBMs and pharmaceutical firms are responding to the signals of policymakers.”

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.