The Costs of Innovation

As readers of this blog surely know, living with diabetes in the United States can be expensive — more or less so depending on a number of factors such as treatments prescribed, insurance coverage, and degree of disease progression. At the same time, new drugs, treatments, and devices for diabetes — Type 2 in particular, but also Type 1 — are proliferating. As a recent article in The New York Times makes clear, the growing costs associated with diabetes and the outpouring of new treatments are anything but unrelated.


Published last week, the article — part of a series on health-care costs called “Paying Till It Hurts” — profiles several people with Type 1 diabetes and other chronic diseases, analyzing the costs of their various treatments. One striking aspect of the article is that even people with excellent insurance end up with high out-of-pocket costs. The woman profiled in the greatest detail in the article, who has Type 1 diabetes and works as a manager for an environmental services company, expects to pay $5,000 in diabetes-related out-of-pocket expenses this year. This includes her share of the cost for a new insulin pump; her current pump has been in use since 2007. As the article notes, most of the necessary devices and supplies for Type 1 diabetes are patented and thus not available in any generic form (this is also true for many drugs for Type 2 diabetes). Cheap pig insulin, long ago replaced by more expensive human insulin, has now been largely replaced by still-more-expensive insulin analogs, which are engineered to have specific modes of action in the body (such as long-acting or rapid-acting). One company, Medtronic, manufactures 65% of all insulin pumps sold in the United States and can extract a premium for this market dominance. And, of course, simple blood glucose test strips — which are all proprietary and cannot be switched between brands of meters — have costs that add up over time.

While profiling the costs of diabetes is more or less uncontroversial, other aspects of the Times article have come under attack from people with diabetes. As Amy Tenderich at Diabetes Mine points out, the article strongly implies — with the help of quotations from several doctors — that insulin analogs and continuous glucose monitors, among other treatments and devices, are mostly frivolous innovations. According to one doctor who was quoted, these innovations may help certain people with difficult-to-treat diabetes, but they are being marketed to the general diabetes population for whom their benefits are questionable. As several online commentators noted, however, some benefits are not easily measured and may not be reflected in clinical outcomes — in areas such as convenience, ease of use, and peace of mind. For people who sometimes experience hypoglycemia (low blood glucose), for example, continuous glucose monitoring (CGM) can mean less worrying, while insulin analogs may allow for simpler dosing and fewer injections

What’s your take on the cost of diabetes treatments — do you struggle with out-of-pocket costs? Have you noticed improvements in the way your diabetes is treated based on new technologies in the last few years, or do you think most innovation is profit-driven hype? Should people with diabetes pay some out-of-pocket costs for expensive treatments and devices to discourage their overuse, or should all costs ideally be covered by insurance, to reflect that developing diabetes is not a choice? Leave a comment below!

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  • BK

    This riles me! There are people still using NPH and having problems with poor control and low blood sugars because some insurance company or they themselves can’t afford or don’t want to pay for Lantus! But they also do not want to eat at almost the same time every day, 3 meals-all about equal in carbs, and about 4 to 5 hours apart every day. They want a life with some flexibility. Can you blame them? Unfortunately flexibility comes at a price. If you want good control, you either have to adjust your life to the kind of insulin you can afford or come up with the funds for a more physiological and user friendly insulin regimen. And quite frankly, some people don’t have a choice. If they spend it on the Analogs, they don’t have it for their rent or food. In this day and age, and this country of vulgar wealth for some, I think all insulin should be covered with a small co-pay if any. A small co-pay to keep people from wasting it perhaps, but the same for analogs as for human insulins. I’ll get off my soapbox now.

  • jim snell

    This is the most curious article and comments.

    I am a 30 year plus type 2 who had to really jump on the program and arrest his type 2 diabetes after a stroke in 2007 at age of 62.

    I am involved in electronics and the high performance side of integrated electronics and computers and yes we have seen year after year of cost performance improvements and become accustomed to this.

    What I do not see this same improvement in the area of Diabetes and for me type 2; I do not see any real improvement in either radically dropping type 2 diabetes rates and its world wide expansion nor dropping of costs of items like insulin, drugs ( metformin excepted), glucose test strips and cgms equipment that could really help folks by being more cost effective with wide spread volume and manufacturing!

    I am unclear why this is and what is required to make a dramatic change. There certainly has been a ton of money spent and it is dawning on companies/governments world wide this disease/problem threatens to wreck lives and bankrupt economies/budgets world wide.