California Selects Generic Company Civica Rx as Insulin Partner

California Governor Gavin Newsom

California Governor Gavin Newsom, as part of his tour of the State of California, Newsom announceda contract with generic manufacturer, Civica, to make the most commonly used short- and long-acting insulins that will be offered at prices of $30 a vial and $55 for a box of five pre-filled pens. The move will bring down the price of insulin by about 90%, saving cash-paying patients between $2,000 and $4,000 annually, Newsom said.

The agreement with Civica is part of the CalRx initiative, which also plans to make biosimilar insulins available for glargine, aspart, and lispro, which are expected to be interchangeable with Lantus, Humalog, and Novolog. California is investing $100 million into developing a biosimilar insulin product and building a drug manufacturing.

“With CalRx, and unlike private companies, we’re getting at the underlying cost and CalRx will prevent the egregious cost-shifting that happens in traditional pharmaceutical price games,” Newsom said. “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.”

Newsom’s announcement comes following announcements of price cuts by the nation’s three major insulin producers. Last week, Sanofi said is cutting the list price of Lantus (insulin glargine injection) by 78%. Lantus is Sanofi’s most widely prescribed insulin in the United States, the company said. The company will also establish a $35 cap on out-of-pocket costs for Lantus for all patients with commercial insurance. The changes go into effect Jan. 1, 2024. Novo Nordisk also recently said it is lowering the U.S. list prices of several insulin products by up to 75% and Eli Lilly’s recently announced that it had significantly reduced its insulin prices.

Civica Rx was created in 2018 by a collective of seven major healthcare systems and three philanthropic organizations that saw the need to reduce the cost of critical generic medicines and create more predictable supplies, ensuring patients take priority over profits, West Health, a nonprofit organization committed to lowering healthcare costs said.

“California made history today by partnering with Civica Rx, the nation’s first nonprofit generic pharmaceutical company, to produce affordable insulin for residents in need,” said Shelley Lyford, chief executive officer of West Health and chair of the Gary and Mary West Foundation, who also serves as vice chair of the Civica Rx board of directors.

Additionally, California will seek to manufacture its own naloxone, an opioid antagonist medication that is used to reverse an opioid overdose. As part of the State’s Master Plan to Tackle the Fentanyl Crisis, California is exploring potential next products to bring to market, such as 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, Governor Newsom’s office said.