California Prepares to Produce Its Own Low-Cost Insulin

(Photo: David Moruzzi/Unsplash) California Governor Gavin Newsom has signed a $308 billion budget that will move the state closer to its long-term goal of producing its own low-cost insulin.

The budget, publicized Thursday, earmarks $100 million for the research and manufacturing of affordable insulin. Half of it will fund the construction of a new California-based production facility. The other $50 million will go toward developing less expensive forms of the vital drug.

The out-of-pocket cost of insulin has surged over the years, with a 54 percent increase between 2014 and 2019. While more recent pandemic-related savings measures tamed prices a bit, it was only by about five percent. This leaves individuals and families scrambling to afford the medication, which costs anywhere from $20 (on the reasonable end) to over $1,000 per month out-of-pocket.

“It’s simple. People should not go into debt to get life-saving medication,” Newsom tweeted Thursday.

California is going to make its own insulin.

It’s simple. People should not go into debt to get life-saving medication. pic.twitter.com/yB4mpGjtQO

— Gavin Newsom (@GavinNewsom) July 7, 2022

If Newsom manages to scale the regulatory roadblocks that will inevitably pepper his path, California would become the first state to produce its own pharmaceuticals. Some have argued in favor of domestic, state-regulated drug manufacturing for years, especially as the COVID-19 pandemic highlighted the disadvantages of internationally outsourced production. Proponents of this approach argue it would smooth common supply concerns, create jobs, and ease the strain on consumers’ pocketbooks. But that’s easier said than done, especially when private drug companies rule the domestic market.

Newsom has long sworn to make prescription drugs and other medical expenses more affordable for Californians. He previously explored the idea of partnering with Utah-based nonprofit drug manufacturer Civica Rx to produce generic forms of essential drugs in California. Civica Rx already has its foot in the door through a partnership with insurer Blue Shield of California, for which it produces generics. The manufacturer said last year that insulin would be a “more complex and expensive drug to develop,” but “certainly possible.” Right now, however, it’s unknown whether Civica Rx remains an essential stakeholder in California’s long-term plan. If it is, the manufacturer could help bring insulin costs down to $30 per vial—a severe drop in price that could potentially force private companies to compete.

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