Sanofi SNY announced up to a 78% cut in the list price of its most popular insulin, Lantus, following the likes of rival Novo Nordisk NVO and Eli Lilly LLY. Similar to Lilly, Sanofi also said it is capping out-of-pocket costs for Lantus insulin for all patients with commercial insurance, at $35.
In June last year, Sanofi launched an unbranded biologic for Lantus at an approximately 60% discount to Lantus’ list price with an aim to lower diabetes medicines costs. It had also decided to put a $35 cap on out-of-pocket costs of insulin for all people without insurance. With the latest price cuts, Sanofi claims that no diabetes patient, with or without insurance, will pay more than $35 for a monthly supply of Lantus. Sanofi said it will also slash the list price of its short-acting Apidra insulin.
However, the company plans not to start this until January 2024. Sanofi also did not announce any changes to its existing savings programs,
The stock has declined 7.6% in the past year compared with an increase of 0.7% for the industry.
Image Source: Zacks Investment Research
Earlier this week, Novo Nordisk said it plans to lower prices of several pre-filled insulin pens and vials by up to 75%in the United States. However, like Sanofi, Novo Nordisk’s price cuts will come into effect in January 2024. The products include pre-filled pens and vials of basal (long-acting), bolus (short-acting) and pre-mix insulins, specifically Levemir, Novolin, NovoLog and NovoLog Mix 70/30. Novo Nordisk said it would slash the list price of its NovoLog insulin by 75% and that of Novolin and Levemir by 65%. It is also lowering the prices of some non-branded insulin products.
Like Sanofi, Novo Nordisk also did not make any changes to this existing affordability programs, which aim at limiting patients’ insulin costs.
In early March, Lilly said it is cutting list prices of some of its popular insulin by 70% to significantly reduce diabetes patients’ out-of-pocket costs.
Lilly is reducing list prices of non-branded insulin, Insulin Lispro Injection, as well as branded insulin, Humalog and Humulin. Lilly is also launching Rezvoglar, which is a biosimilar of Sanofi’s Lantus. Lilly has priced Rezvoglar at $92 per five-pack of KwikPens, reflecting a 78% discount to Sanofi’s Lantus. The reduced prices should cap patients’ out-of-pocket costs at $35 or less per month.
Sanofi, Lilly and Novo Nordisk’s aggressive price cuts come amid pressure to cut diabetes costs to make insulin affordable for Americans. The prices of diabetes medicines have tripled in the past several years, thus prompting federal lawmakers to call for a cap on insulin prices. The passing of President Joe Biden's Inflation Reduction Act in 2022 capped out-of-pocket costs for insulin in Medicare at $35 per monthly prescription.
However, the price cuts should not hurt the profits of these large insulin makers as they were already giving huge discounts and rebates on their products.
Zacks Rank & Stock to Consider
Sanofi has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A biotech company worth considering is Ligand Pharmaceuticals LGND, which has a Zacks Rank of 1.
Estimates for Ligand Pharmaceuticals’ 2023 earnings per share have increased from $3.30 per share to $4.15 per share while that for 2024 have gone up from $3.10 to $4.28 over the past 30 days. Ligand Pharmaceuticals’ stock has declined 34.1% in the past year.
Ligand Pharmaceuticals beat earnings expectations in one of the trailing four quarters. The company delivered a four-quarter negative earnings surprise of 10.07%, on average.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report