On January 1, 2026, two unprecedented insulin programs launched simultaneously: nonprofit Civica Rx began distributing insulin glargine pens for $55 per box, while California became the first state to sell its own CalRx-branded insulin at the same price point—both undercutting branded products by up to 90%. The coordinated launches mark the first major breach in a pricing fortress built by three pharmaceutical giants who control 90% of the U.S. insulin market. Unlike existing insulin, these products require no insurance forms, no rebates, no hidden markups. Just one transparent price available to anyone.
Behind those transactions lies eight years of compounding tragedy: patients dying after rationing insulin they couldn't afford, a 1,200% price increase over two decades, and a byzantine rebate system that enriched middlemen while forcing diabetics to choose between medication and rent. The Civica and CalRx launches—alongside manufacturer price cuts, Medicare caps, state copay laws, and an ongoing FTC lawsuit against pharmacy benefit managers—represent the first coordinated counteroffensive combining nonprofit competition, state intervention, and federal enforcement. The question is whether these efforts can permanently dismantle the pricing machinery, or whether pharmaceutical companies and pharmacy benefit managers will find new ways to extract profits from the 8.4 million Americans who need insulin to survive.
People who rely on insulin for survival, making price increases literally life-or-death
1,200%
Price increase for Humalog (1999-2019)
One vial went from $21 to $332 in twenty years
$55
Civica & CalRx insulin glargine price (5 pens)
Compared to $150-$500 for equivalent branded products
1 in 4
Diabetic patients who ration insulin
Due to cost, risking blindness, kidney failure, coma, or death
$35
Maximum copay in Medicare & California
Federal cap for Medicare (2023), California cap for private insurance (2026)
2 states
Producing their own insulin
California first to launch; Minnesota exploring similar program
90%
Market share of three insulin makers
Eli Lilly, Novo Nordisk, and Sanofi dominate U.S. market
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Play.
Dorothy Parker
(1893-1967) ·Jazz Age · wit
Fictional AI pastiche — not real quote.
"How touching that it took only eight years of corpses and a 1,200% markup for capitalism to discover that perhaps diabetics shouldn't have to auction their kidneys to afford the insulin that keeps them alive. One does wonder what delayed the epiphany—was it the death toll, or merely that there weren't enough middlemen getting their cut?"
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People Involved
Alec Raeshawn Smith
Type 1 diabetic patient (Died June 27, 2017, from diabetic ketoacidosis after rationing insulin)
Nicole Smith-Holt
Patient advocate and mother of Alec Smith (Leading insulin affordability advocate)
Martin VanTrieste
Founding President and CEO of Civica Rx (2018-2022) (President Emeritus and Board Member)
Ned McCoy
President and CEO of Civica Rx (Leading Civica's insulin manufacturing and distribution)
Gavin Newsom
Governor of California (Leading CalRx state insulin program)
Organizations Involved
CI
Civica Rx
Nonprofit Generic Drug Manufacturer
Status: Distributing affordable insulin as of January 2026
Nonprofit generic drug company founded by hospital systems and philanthropies to combat drug shortages and price exploitation.
BI
Biocon Biologics
Biopharmaceutical manufacturer
Status: Manufacturing insulin glargine for Civica under FDA approval
Global biosimilars company manufacturing the first FDA-approved interchangeable insulin biosimilar for Civica distribution.
FE
Federal Trade Commission (FTC)
Federal Agency
Status: Actively litigating against pharmacy benefit managers
Federal agency that filed landmark lawsuit against top pharmacy benefit managers for inflating insulin prices.
EL
Eli Lilly and Company
Pharmaceutical Company
Status: Reduced insulin prices by 70% in 2023
Major insulin manufacturer that announced dramatic price cuts following political pressure and nonprofit competition.
CA
CalRx
State pharmaceutical program
Status: Distributing state-branded insulin as of January 2026
First-in-nation state-branded pharmaceutical program created by California to manufacture and distribute affordable prescription drugs.
NO
Novo Nordisk
Pharmaceutical Manufacturer
Status: Implementing additional insulin price cuts in 2026
Danish pharmaceutical company and one of three major insulin manufacturers controlling 90% of U.S. market.
Timeline
FTC Reaches Landmark Settlement with Express Scripts on Insulin Pricing
Legal
Cigna's Express Scripts settles FTC lawsuit alleging anticompetitive rebate practices inflated insulin list prices; no fines but requires 10-year structural reforms including pass-through rebates to patients at point-of-sale starting 2028 and delinking compensation from list prices.
FTC Pauses Express Scripts Lawsuit for Settlement Talks
Legal
FTC stays administrative proceedings against Express Scripts and affiliates until July 1, 2026, while negotiating proposed consent agreement—first potential settlement in insulin price lawsuit. Cases against CVS Caremark and OptumRx continue.
Civica Rx Launches $55 Insulin Glargine at Lowest U.S. Market Price
Product Launch
Civica begins distributing insulin glargine-yfgn across U.S. pharmacies at $55 for five pens, significantly undercutting market rates with transparent pricing requiring no insurance forms or copay programs.
California Launches First State-Branded Insulin Program
Product Launch
California becomes first state to sell its own CalRx-branded insulin glargine at $55 per five-pen box through partnership with Civica and Biocon, making California the only state contracting for its own affordable insulin.
California $35 Insulin Copay Cap Takes Effect
Implementation
SB 40 caps insulin copays at $35 for 30-day supply for Californians on private health plans and prohibits step therapy requirements that forced patients to try multiple insulins before coverage approval.
Novo Nordisk's Additional Insulin Price Cuts Take Effect
Price Reduction
Novo Nordisk implements 75% price cut for Fiasp and 72% cut for Tresiba, expanding beyond 2023 reductions.
Trump Administration Secures $35 Insulin Agreements with Manufacturers
Policy
Novo Nordisk commits to providing NovoLog and Tresiba at maximum $35 per month as part of broader pharmaceutical pricing agreements with Trump administration covering insulin and GLP-1 medications.
Sanofi Expands $35 Insulin Access to All Americans
Policy
Sanofi's Insulins Valyou Savings Program now offers 30-day supply of any Sanofi insulin for $35 regardless of insurance status, expanding beyond previous commercial insurance limitation.
Civica Announces $55 Insulin Launch Details
Announcement
Civica reveals insulin glargine will sell for $55 per five-pen box starting January 1, 2026.
California Announces CalRx Insulin Launch Details
Announcement
Governor Newsom announces CalRx-branded insulin glargine will launch January 1, 2026 at $11 per pen ($55 per five-pack), making California first state to produce and sell its own insulin.
FTC Insulin Lawsuit Resumes After Stay Lifted
Legal
Administrative Law Judge lifts 105-day stay on FTC lawsuit against PBMs as new commissioners appointed; PBMs file motion to dismiss two days later.
Novo Nordisk Announces 2026 Price Cuts
Announcement
Novo announces price reductions for Fiasp (75%) and Tresiba (72%) taking effect in 2026, beyond 2023 cuts.
FTC Sues Top Pharmacy Benefit Managers
Legal
Federal lawsuit targets CVS Caremark, Express Scripts, OptumRx for creating perverse rebate system inflating insulin prices.
Manufacturer Price Cuts Take Effect
Implementation
All three major insulin makers' price reductions go live nationwide.
Novo Nordisk announces NovoLog price cut of 75%, Novolin and Levemir by 65%.
Eli Lilly Cuts Insulin Prices 70%
Price Reduction
Eli Lilly announces 70% price cuts and $35 copay cap following political pressure.
Medicare $35 Insulin Cap Takes Effect
Implementation
Medicare beneficiaries pay maximum $35/month for insulin under Inflation Reduction Act.
Inflation Reduction Act Passes
Legislation
Law caps Medicare insulin copays at $35/month, taking effect January 2023.
Civica Announces Insulin Manufacturing
Announcement
Civica reveals plans to manufacture and distribute affordable insulin glargine, lispro, and aspart.
FDA Approves First Interchangeable Insulin Biosimilar
Regulatory
Biocon's insulin glargine-yfgn becomes first interchangeable biosimilar insulin approved in U.S.
Minnesota Passes Alec Smith Insulin Affordability Act
Legislation
First-in-nation state law creates emergency insulin program, inspired by Alec Smith's death.
Humalog Reaches $332 Per Vial
Price Increase
Humalog price hits $332—a 1,200% increase from $21 in 1999, forcing 1 in 4 diabetics to ration.
Civica Rx Founded
Organization
Seven health systems and three philanthropies launch nonprofit pharmaceutical company to combat drug shortages and price gouging.
Alec Smith Dies Rationing Insulin
Tragedy
26-year-old Alec Smith found dead from diabetic ketoacidosis after rationing $1,300/month insulin he couldn't afford.
Humalog Baseline Price: $21 Per Vial
Reference Point
Eli Lilly's Humalog insulin costs $21 per 10mL vial, establishing baseline before two-decade price escalation.
Scenarios
1
Nonprofit Model Expands, Manufacturers Retreat Further
Discussed by: Healthcare policy analysts at Kaiser Family Foundation, Commonwealth Fund researchers
Civica's success with insulin glargine triggers broader market shift. The nonprofit launches insulin aspart and lispro in 2026-2027 at similar price points, capturing 15-20% market share within three years. California's CalRx program and Mark Cuban Cost Plus Drugs expand similar models to other chronic disease medications. Facing sustained competition and continued political pressure, major manufacturers implement additional price cuts or exit low-margin insulin markets entirely, focusing on newer diabetes drugs like GLP-1 agonists. PBMs adapt by shifting rebate structures, but fundamental pricing transparency becomes industry standard.
2
Manufacturers Undercut Nonprofit, Status Quo Persists
Discussed by: Pharmaceutical industry consultants, Wall Street analysts covering pharma sector
Eli Lilly, Novo Nordisk, and Sanofi view Civica as existential threat and respond with targeted price matching on specific insulin formulations while maintaining higher prices on premium products and newer formats. They leverage existing pharmacy relationships, faster supply chains, and brand loyalty to defend market share. The FTC lawsuit against PBMs drags through courts for years without resolution. While some patients benefit from lower prices, the underlying rebate system and opacity persist. Civica remains niche player serving primarily uninsured and high-deductible patients—meaningful but not transformative.
Discussed by: Drug supply chain experts, diabetes patient advocacy groups expressing concerns
Civica encounters manufacturing challenges, quality control issues, or regulatory hurdles that delay insulin aspart and lispro launches beyond 2027. Biocon production capacity proves insufficient to meet demand, creating sporadic shortages that force patients back to branded products. Pharmaceutical industry amplifies these failures in marketing campaigns questioning nonprofit competency. Media coverage of diabetics unable to access Civica insulin damages the model's reputation. Without proven track record across all three major insulin types, the initiative stalls. Traditional manufacturers retain dominance, and pricing reforms remain limited to voluntary manufacturer programs.
Momentum from Civica launch, manufacturer price cuts, and FTC litigation builds political will for comprehensive federal insulin pricing legislation. Congress extends Medicare's $35 copay cap to all Americans regardless of insurance status, similar to Minnesota's Alec Smith Act but nationwide. Law includes provisions limiting PBM rebate practices and requiring pricing transparency. This regulatory solution renders the nonprofit model partially redundant but validates the competitive pressure that made reform possible. Civica pivots to manufacturing other essential medications where price gouging persists.
5
State Insulin Programs Proliferate Nationwide
Discussed by: State legislators in Minnesota, Washington, Colorado; National Academy for State Health Policy researchers
California's CalRx success triggers nationwide replication. Within 18 months, Minnesota launches its own state-branded insulin building on the Alec Smith Act framework. Washington, Colorado, and Michigan announce similar programs by 2027. States form purchasing consortium to leverage collective bargaining power with Biocon and other biosimilar manufacturers. The state-based model proves more politically viable than federal legislation, creating patchwork of affordable insulin access that eventually pressures Congress to nationalize the approach. Traditional manufacturers either compete on price or exit insulin markets entirely as states become primary purchasers for Medicaid and uninsured populations.
6
Express Scripts Settlement Triggers PBM Industry Restructuring
Discussed by: Healthcare antitrust attorneys, FTC observers at Proskauer Rose and Buchanan Ingersoll & Rooney
Express Scripts reaches consent agreement with FTC by July 2026, establishing precedent that fundamentally restructures pharmacy benefit manager rebate practices. Settlement terms ban percentage-based rebates that incentivize high list prices and require transparent pass-through pricing to patients. Facing similar legal pressure, CVS Caremark and OptumRx negotiate comparable settlements within 12 months. The restructuring eliminates the perverse incentives that drove insulin prices up 1,200%, but PBMs adapt by shifting to flat administrative fees while maintaining market power through formulary control and mail-order pharmacy ownership.
Historical Context
Generic Drug Price Collapse (1980s-1990s)
1984-2000
What Happened
The Hatch-Waxman Act of 1984 created abbreviated pathways for generic drug approval, triggering massive price competition. Within years, generic versions of common medications sold for 20-30% of branded prices. Patients who once paid hundreds for antibiotics and blood pressure medications saw costs plummet. The pharmaceutical industry shifted strategy toward newer patented drugs while generic manufacturers proliferated.
Established enduring two-tier pharmaceutical market: cheap generics and expensive branded innovation.
Why It's Relevant Today
Civica's biosimilar insulin follows this playbook. If interchangeable biosimilars replicate generic success, insulin pricing could face similar collapse—but biologics are harder to manufacture than small-molecule drugs, creating higher barrier to competition.
EpiPen Price Scandal (2016)
2007-2016
What Happened
Mylan acquired EpiPen in 2007 and incrementally raised prices from $100 to over $600 for a two-pack by 2016—a 500% increase for a life-saving allergy treatment with minimal manufacturing cost. Parents, schools, and patient advocates erupted in protest. Congressional hearings grilled Mylan's CEO. The backlash triggered generic competition, Mylan's own generic version, and permanent reputational damage.
Outcome
Short Term
Mylan launched generic EpiPen at $300; competitors entered market.
Long Term
Prices stabilized but never returned to pre-gouging levels. Mylan merged with Upjohn in 2020.
Why It's Relevant Today
The insulin crisis mirrors EpiPen dynamics: monopolistic market, life-or-death product, incremental price increases that suddenly became politically intolerable. Both required patient deaths and public outrage to trigger manufacturer response—showing voluntary price cuts come only under existential threat.
AIDS Drug Pricing Crisis and Generic Manufacturing (1990s-2000s)
1987-2003
What Happened
When antiretroviral drugs emerged in the mid-1990s, pharmaceutical companies charged $10,000-15,000 annually per patient—pricing that condemned millions in developing countries to death. Activist pressure and generic manufacturers in India and Brazil began producing identical drugs for $300-500 annually. The price differential became morally and politically unsustainable. By 2003, major manufacturers slashed prices for developing markets, and organizations like PEPFAR negotiated bulk purchase agreements using generic competition as leverage.
Outcome
Short Term
Generic competition forced 90% price reductions in developing countries by 2005.
Long Term
Established tiered pricing models and normalized generic antiretrovirals, saving millions of lives.
Why It's Relevant Today
Demonstrates that nonprofit and low-cost manufacturers can break pharmaceutical pricing strangleholds when producing essential medicines. Civica plays similar role domestically that Indian generic manufacturers played globally—using manufacturing capacity to challenge unjustifiable pricing on life-saving drugs. The lesson: competition works, but requires actual alternative suppliers, not just political pressure.
