Unanimous Consent Request--S. 1132

Floor Speech

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Mr. KENNEDY. Mr. President, I want to talk a little bit today about a subject that I have struggled with in terms of how to address, and I am going to finish my remarks by offering a bill up for the Senate's consideration.

Mr. President, I know you are aware of all of this, but we can't live without glucose. Glucose fuels our cells, and, of course, our cells make up our muscles and our tissues and our organs, and we can't live without insulin. Insulin is a hormone that regulates the amount of glucose in our blood. Thankfully, for most people, their pancreas produces insulin naturally. It is just an undeniable fact that without insulin, without glucose, you are dead.

Unfortunately, as you know, sometimes our pancreas does not create insulin or doesn't create enough insulin or creates it erratically, and that condition, of course, is called diabetes. Thankfully, 100 years ago, in 1920, there was a Canadian physician and scientist whose name was Dr. Frederick Banting. He invented a synthetic form of insulin to help people whose pancreas could not produce the hormone. He won a Nobel Prize for it. It was extraordinary.

He was so committed to helping humanity that he and his other colleagues who had patents on this synthetic insulin sold their insulin patents for $1, 1 buck. They wanted to make sure that insulin was affordable. God bless them.

Today, 34.2 million Americans have diabetes. Not all people who have diabetes need insulin, but of that 34.2 million people, 7.4 million people need synthetic insulin; otherwise, they are dead men; they are dead women. Eighty-eight million Americans have what we call prediabetes. That means they are just a hair away from having full- blown diabetes. It is a problem in Louisiana, Mr. President, as I am sure it might be in Colorado. Louisiana has about 500,000 people with diabetes, most of whom need insulin. That is 12 percent of my population.

Now, here is where the story becomes dark. Three pharmaceutical companies have a monopoly on synthetic insulin. These three companies control about 90 percent of the global supply of insulin. Diabetes is certainly not unique to Americans, and these three pharmaceutical companies control almost, well, virtually, 100 percent of the U.S. market. Their cost, as best I can tell, you might be surprised to learn that a lot of the cost of these pharmaceutical drugs--and that is what synthetic insulin is; some call it a biologic--but the cost, as best I can tell, to produce a vial of insulin is about 10 bucks in today's dollars. There is no viable generic. You have to buy a brand name from one of the three companies.

Now, the cost of synthetic insulin has increased fairly recently very dramatically. The average list price for insulin tripled from 2002 to 2013, and then from 2013 to 2016 it doubled again. In the last 10 years, the out-of-pocket costs because many people have insurance--not everyone, but many people have insurance--in the last 10 years, the out-of-pocket cost of insulin for the average patient has doubled. Most diabetes patients, to give you some context, require two, quite often, three vials a month.

Let me try to get out of the conceptual and be specific. One type of insulin, and I don't mean just to single them out, but it is called Humalog. It was released in 1996. Its price since 1996, which costs about 10 bucks to make it per vial, has increased 1,700 percent. It has gone from $21 a vial to $375 a vial. Now, that same vial in Canada that costs $375 here costs about 50 bucks in Canada. Remember, you need three vials, sometimes two, hopefully, a month to live, to survive. So if you use three vials a month at 375 bucks a crack, the cost has gone from $750 a year in 1996 to $13,500 a year. Nothing has changed about the insulin. This insulin is 100 years old--100 years old.

Now, that, of course, is the list price. As we know, many people have insurance, and there are all sorts of insurance plans with differing amounts of deductions and differing amounts of copays, but I think a recent report by the Health Care Cost Institute is instructive. It found that the average American with type 1 diabetes, who needs insulin, has out-of-pocket insulin costs every year of about $6,000. That is every year. You will not be surprised to learn that, as a result of that, about one in four Americans has to ration the insulin-- they don't take their full doses--to make them last longer.

Now, I have a bill. It is called the Ending Pricey Insulin Act. I don't know where my staff comes up with these names. I can hardly say that. Anyway, it is to try to lower the cost of insulin. It is going to cap out-of-pocket costs for insulin if this bill, in its wisdom, passes the Senate. It is going to cap the cost at 50 bucks for a 30-day supply. It is going to cap the cost for people who have insurance. It is going to cap the cost for people who have Medicare. It is going to cap the cost for people who have Medicaid, and it is going to cap the cost for the people who don't have anything--no insurance whatsoever. It is going to cover high-deductible health plans. It is going to cover the CHIP program. It is going to cover veterans' health plans. It is going to cover TRICARE. It is going to cover everybody and have a maximum out-of-pocket cost per month of $50.

This bill would take effect for plan year 2022. Health plans, as the Presiding Officer knows, set their rates 6 to 9 months in advance, so I want to give them fair warning here. My bill provides a workable runway for the insurance plans to comply, but the bill does include a retroactive clause that insures any out-of-pocket costs above 50 bucks that people pay. After that, they will be reimbursed. The bill is only five pages long. I don't think it is complicated to fix this problem.

Now, I really struggled with whether to offer this bill. Let me say first that I am not trying to pick on our pharmaceutical drug companies. What they have done in the last year is nothing short of miraculous. To me, it is just evidence that American and human ingenuity can never be underestimated, and it is extraordinary what the private sector can accomplish when the government gets out of the way. I am talking, of course, about the coronavirus vaccines. I happen to have two brothers who are physicians, and I called both of them right after the coronavirus was determined to be the coronavirus.

I said: How long for a vaccine?

They both said: A minimum of 2 years, probably 3 or 4.

The pharmaceutical drug industry did it in less than a year. God bless them.

So I don't mean to criticize them. I understand they have research costs, and I understand they have marketing costs, and I certainly understand that the health insurance delivery system and the market itself is opaque. God, how did we design such a system? I yearn for the day--we all do--when we have a healthcare delivery system for pharmaceutical drugs that looks like somebody designed it on purpose.

I have spent a lot of time--I certainly don't pretend to be an expert--researching the problem surrounding the cost of insulin, and everybody blames everybody else. The pharmaceutical drug companies blame the PBMs. The PBMs blame the insurance companies. They all blame each other. Some of them blame the doctors. Some of them blame patients for whining. You know, at some point, you say: Gosh. You know, it is almost as if you are intentionally making it opaque, and that is a big part of our health insurance market problem.

I was reading an article the other day, and this is on a slightly different subject. As you know, the Trump administration issued an Executive order saying hospitals have to post their prices. The hospitals sued, and the government won. So now the hospitals have to post their prices.

The Wall Street Journal did a very interesting investigative piece. It really was a fine piece of work in this post-journalism, pay-to-play world that we live in. It looked at the websites of all of the major hospitals throughout the United States, and it found, I think--I don't remember the number--over 100 that had implemented or put it on their websites' software so that the posted prices for their services that they offered, which the Executive order required, were there on the websites, but you just couldn't see it, and consumers couldn't find it. Those who could find it had to go through about 10 different layers to get to it. When the Wall Street Journal contacted the hospitals, they said: Oh, whoops. It is just a software mistake. We will get it fixed.

So the market is opaque.

Look, some of my colleagues are going to oppose this bill, and I understand their point of view in their saying: Kennedy, this is price- fixing. We thought you were a free market guy. I am. I am. I don't want to have to do this, but we have been talking about this problem for years, and it just keeps getting worse and worse and worse.

I think the Members of the U.S. Senate--the most interesting group of people I have ever been around--are intelligent enough to understand nuance. They understand that this is price-fixing, but they also understand this argument of, well, you are going down a slippery slope. No, we are not. There is nothing in this bill that says we have to go down a slippery slope. I think most fair-minded people understand that insulin, as a biologic, pharmaceutical drug, is unique. We are not talking about a drug that the pharmaceutical industry has spent hundreds of billions of dollars developing and has taken on extraordinary risk. This is a product that has been around since 1920. It is virtually unchanged. It costs 10 bucks a vial to produce. There is virtually no risk, none whatsoever. It hasn't changed much in 100 years, and people have to have it. The costs were recouped long ago.

I am not accusing anybody of anything, but I think a big part of the problem is the fact that three companies have a monopoly, and there is no generic because some people engage in what is called evergreening, which is a very clever way devised by the patent lawyers to keep patents from ever running out. I am just tired of holding hearings and issuing press releases and talking to the press about it and then doing nothing.

I will just say--and I am going to end because I know Senator Crapo has something he wants to say, and I want to hear him--that I really struggled with this. I guess I am being inconsistent, because I do believe in the free market. I don't believe in having the government set prices, but I don't know what else to do.

I don't think we are going down a slippery slope. Insulin is unique. We have all got good pairs of L.L. Bean and other boots to keep us from going down that slippery slope. There is no law that says the U.S. Senate can't consider issues on an ad hoc basis. 1132, introduced earlier today.

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Mr. KENNEDY. Mr. President, my colleague, the Senator from Idaho, knows how much I respect him, and I certainly appreciate the invitation to work with him and his committee, and I intend to do that.

And I know that the Senator didn't say this, but I don't believe in government-run healthcare. But we have a discrete problem here and a very unique situation that can be addressed. This is not a biologic, as I said earlier, that costs hundreds of millions of dollars to develop. This is insulin, and a lot of Americans need it or they will die.

There is a monopoly, and there are efforts that have been made to maintain that monopoly, and my people in Louisiana--I know the people in Idaho--many of them feel the same way, and that is why they applaud Senator Crapo's efforts, but they are hurting.

You can die without insulin. You can die. And it costs 10 bucks a vial to make, and it has been around 100 years, and now it costs 375 bucks. And all you have to do is walk across the border into Canada, and you can buy it for 50 bucks.

The market is being manipulated. I know it is complicated, and I understand politics. I have been around it a good portion of my life, but this is an issue where we need to stop--we need to stop--talking about it, strutting around, issuing press releases, holding hearings, and doing nothing.

I don't want to price fix. I don't. It makes me real uncomfortable to be proposing this, but I don't know what else to do. There comes a point where patience--where patience--ceases to be a virtue.

And here is what I know. I mean, the bill has been objected to, and I appreciate it. You pass a bill like this or a similar bill like this; you are going to see a solution pretty fast. You are going to see a solution real fast. You are going to see some--this opaque market react with new energy. They are going to be running around like hounds from hell, trying to keep this from becoming the law, and that is why we need to hit this head-on.

But with that, I thank the President for his attention, and I thank my colleague for his eloquent remarks.

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