In 1923, three men in Toronto held the patent to insulin. Frederick Banting, Charles Best, and James Collip had spent years watching children die of type 1 diabetes. Before insulin that diagnosis was a death sentence, usually inside a year or two and no doctor on earth could do a thing about it. Then they injected the first patients and watched kids who had been sliding into comas sit up and ask for food. They signed the patent over to the University of Toronto and took a single dollar for the whole thing. Banting's reasoning has been repeated a thousand times since because it is hard to improve on. Insulin did not belong to him. It belonged to the world.

Here is what the world did with it. Humalog is Eli Lilly's fast acting insulin, the kind you inject at mealtimes and it came to market in 1996 at about twenty-one dollars a vial. By 2017, the list price was around two hundred and seventy-five. The molecule had not meaningfully changed. Making it had not gotten harder.

That jump deserves an honest asterisk. Twenty-one dollars in 1996 is worth about forty-four today so some of the climb is just inflation being inflation. Take inflation out of it completely and the same drug still ended up around eight times more expensive than it started. Three companies control roughly ninety-nine percent of the American insulin market. Eli Lilly, Novo Nordisk, and Sanofi. All three walked the price up the same curve.

In 2021, the Senate Finance Committee published what it found after going through their internal documents. It does not read like competition. Sanofi raised the list price of Lantus, its long acting insulin, by three percent on October 1, 2017. About three weeks later, Novo Nordisk internally recommended a four percent increase of its own in response. The committee found the three had moved in lockstep for years and sometimes matched each other within days. Three sellers, no fourth option, all pointed the same direction.

Three percent sounds like nothing, which is exactly why it works. The increases never came just once. They came several times a year for two decades and each one stacked on top of the last. Averaged out, the price climbed about thirteen percent a year. At that rate it doubles roughly every five and a half years and there were twenty-one years between 1996 and 2017. Let a price double close to four times and twenty-one dollars turns into two hundred and seventy-five. A competitor matched them the whole way and nobody ever had to announce a big jump.

The bill landed on people who had no way to walk away. Around 1.3 million American adults with diabetes rationed their insulin in a single year. That is close to one in six of everyone who uses it. Rationing means skipping a dose, taking less than you were prescribed, or putting off the refill until payday. For a type 1 diabetic, that is not belt tightening. It is a slow road to a hospital and for some of them it was the last road they took.

Then in the spring of 2023, all three cut their list prices by seventy to seventy-eight percent and capped what patients pay out of pocket at thirty-five dollars a month. The press releases were warm. The timing was warmer. A rule had changed that January. Drug makers pay rebates back to state Medicaid programs and there had always been a ceiling on how large those rebates could get. The American Rescue Plan removed it. Under the old rule, a rebate could never exceed the price of the drug. Under the new one it could. These insulins had climbed so far past inflation for so long that the three companies were headed toward owing Medicaid more per vial than the vial sold for. Cutting the list price was projected to save them hundreds of millions a year.

That is the part worth carrying out of this. The price was never about what insulin costs to make. It was about what they could charge. That held right up until charging it started to cost them money. Congressional hearings did not move them. Lawsuits did not move them. A hundred years of Banting's line about it belonging to the world did not move them. A change to a rebate formula moved all three inside of eight weeks.

The scientists are not the problem. The people in those labs got into this for the same reason Banting did and most of them will never make a pricing decision in their lives. Those get made upstairs by executives and boards answering to shareholders. A spreadsheet has no opinion about a nineteen year old cutting his dose in half to make it to Friday.

There is another drug sitting on that same curve right now. When a company tells you it had a change of heart, go and find out what changed in the math.