Hi Bob,
Thanks for you inquiry. That’s a lot to unpack.
First, it’s important to point out that a large reason for the recent growth in insulin revenue that you cite
is the introduction of Basaglar, which is now competing successfully in the basal insulin space. If you
remove Basaglar and just look at Humalog and Humulin revenue, you will see that the growth of those
two products is significantly less (CAGR of 3.2% over 12 years), and in fact the combined worldwide
revenue for Humalog and Humulin has remained fairly flat for the past six to seven years. (I added a line
to your table to show this).
I also notice that you are using worldwide revenue for Humalog, Humulin and Basaglar, but then cite
several US-specific constructs (medical inflation rates, PBM rebates and discounts). If you are trying to
focus on the dynamics in the US market, then I suggest you may be better served to use our US revenue
figures, which are all available in our Q4 press releases each year, or in our 10-K’s. There are many
factors that impact a product’s revenue performance. In the U.S., these include formulary gains / losses,
rebate and discount concessions, list price changes and most importantly, patient demand / utilization
of our medicines. We provide an explanation each quarter (and therefore each year) on the main drivers
of product performance. Lilly has not raised the list price for Humalog or Humulin in nearly three years.
The main driver for the growth of our insulins for the past several years has been volume – the incidence
rate for people with diabetes has increased, and therefore more people diagnosed with diabetes are
using our medicines.
Moving to your other questions, we do not disclose the actual units sold of each product, but many
analysts cite IQVIA scrip data (NBRx or TRx) as a proxy. We also do not disclose the per-unit cost or profit
of our medicines.
Finally, while Lilly believes in a strong intellectual property system, we do not engage in so-called
“evergreening” activities to extend patents beyond their timelines. You are correct that the patents for
both Humulin and Humalog have expired and both products face significant competition from other
insulin manufacturers (as evidenced by the deep rebates we provide to payers to compete for formulary
access). If your question is more around the question of “Why aren’t there more generic entrants for
insulin?”, then I would remind you that manufacturing insulin requires deep technical expertise and a
significant, ongoing financial commitment that goes well-beyond that for small molecules (pills/ tablets).
Lilly alone has invested nearly $2 billion since 2012 in our diabetes manufacturing facilities.
I hope this provides some additional clarity for your story. Any idea when it might be published?
Regards,
Mark
Mark E. Taylor
Communications Director
Global Corporate Communications
Eli Lilly and Company