It was two months after their son died in 2017 that Nicole Smith-Holt and James Holt, Jr. first told his story to a reporter.
A television station in Rochester was doing a piece on the unaffordability of insulin for diabetics like their son, Alec Smith. The couple related how Alec, who was working as a restaurant manager and had hopes of opening his own restaurant one day, died in his Minneapolis apartment from ketoacidosis after rationing his insulin.
When he turned 26, Alec was no longer covered by Nicoleâs health insurance and did not have enough in the bank to cover his next prescription for insulin and supplies, which by then cost him $1,300 a month. His salary at the time was $35,000 a year, which was too much to qualify for state medical assistance but not enough to allow him to find a policy on the individual market he could afford.
After that first TV interview, Nicole Smith Holt says, Alecâs story has taken on a life of its own. âItâs traveled all around the world,â she said. âHis story has become the face of the insulin affordability issue.â
The couple was on hand at the Minnesota Capitol Tuesday to tell Alecâs story one more time, part of an effort to pass four bills at the Legislature aimed at bringing price transparency and anti-gouging regulation to the insulin market.
In recent months, Alecâs parents have appeared whenever asked, including at a roundtable discussion of the issue in December sponsored by Sen. Matt Little, DFL-Lakeville. And during the 2018 campaign, they stood with DFL candidates Erin Murphy and Keith Ellison when both made the issue part of their platforms.
That story has resonated, both with elected officials and the public. After being sworn in earlier this month, Ellison began his remarks by saying, âLet me tell you about Alec Smith,â andÂ Alec was also the centerpiece of a Washington Post Magazine cover story titled âInsulin Shock: What Happens When a Lifesaving Drug Becomes Intolerably Expensive.â His story was even featured on the fact-checking website Snopes. âDid Alex [sic] Smith Die At Age 26 Because He Couldnât Afford Insulin?â Snopesâ verdict: âTrue.â
The price of insulin, the only product that keeps diabetics alive, has jumped 585 percent over the past 14 years, Little said Tuesday. That represents an increase for one-monthâs supply from $170 to $1,400, prices that are not justified given the fact that makers didnât invest in research and development for the product and donât advertise, said Little.
Part of the problem is that only three manufacturers make most of the insulin in the U.S. and all have been able to prevent the substance from being available to generic manufacturers by slightly changing its formula over the years, a wrinkle in U.S. patent law that isnât the case in Europe, where diabetics do have access to the lower-cost generic versions.
MinnPost photo by Peter Callaghan
James Holt, Jr. speaking during a roundtable discussion in December sponsored by Sen. Matt Little. A picture of their son, Alec Smith, is on the dais.
There is also an issue with the practices of pharmacy benefit managers, the companies that work for insurance companies to negotiate prices with drug makers. To compete for business, drug makers often publish high list prices and then offer discounts to the benefit managers. While those with insurance pay the discounted price, those without are often made to pay the artificially high list price.
Insurance companies have also changed the type and brand of insulin on their preferred lists, requiring doctors to reissue prescriptions and patients to risk not having prescriptions filled after such changes occur.
Nick McGee, the director of public affairs for PhRMA, the association that represents pharmaceutical companies, said the companies are willing to work with legislators âon solutions that enhance the competitive marketplace, lower costs for patients and promote continued medical innovation.â
But McGee said the concerns raised at the Legislature âmisrepresents the dynamicsâ of the marketplace, specific regarding discounts and rebates. âThese dynamics can actually lower the net price of insulin by 70 percent or more. Unfortunately, patients often arenât benefiting directly because the price they pay at the pharmacy â set by their insurer â isnât tied to the discounted price,â McGee said.
Each day when he sits at his desk at the back of the House of Representatives chamber, newly elected DFL Rep. Michael Howard thinks about Alec Smith. Alecâs parents are constituents of the Richfield-based lawmaker, and Howard keeps a photo of Alec on his desk.
âThey have such a powerful and heartbreaking story and they keep telling it,â Howard said of Nicole Smith-Holt and James Holt, Jr. âThatâs what Iâm so impressed about is they will tell Alecâs story to anyone who will listen in the hopes that they can affect and drive some change and make sure it doesnât happen to anyone else.â
Howard said he got to know Alecâs parents while working on the Murphy campaign. Once he was elected in November, he said he asked if they would be comfortable with having his photograph on his desk, so âI could remind myself of the importance but also, generate conversations with my colleagues. Iâve already had several ask, âWhoâs on your desk?â It sparks a conversation âŠ and hopefully drive the Legislature to take action this year.â
Howard is the prime sponsor of what he is calling the âAlec Smith Emergency Insulin Act.â It would set up a program under which diabetics unable to afford insulin could get prescriptions filled on an emergency basis. Pharmacies could get reimbursed from a fund filled with some type of fee assessed to drug makers, similar to the proposals to tap opioid makers for the ill-effects of addiction. Howard said the fees are a way to hold drug makers accountable and require them to share in the solution.
âNever again. Never again should someone lose their life simply because they canât afford the insulin they need to survive,â Howard said.
MinnPost photo by Peter Callaghan
Newly elected DFL state Rep. Michael Howard keeps a photo of Alec Smith on his desk.
Other measures being introduced would require the reporting of prices charged by insulin makers and pharmacies and justifications for price increases; make insurance companies disclose the brands of insulin their plans cover; and bar insurance companies from pulling coverage of any type of product during an insurance plan year. (The bills are filed as Senate File 366 , SF 365, Â and House File 288.)
Perhaps the most-sweeping proposal, part of another bill, SF 364, would empower the state Department of Health to collect and analyze pricing data and determine reasonable prices. The department could then cap prices at levels it determines provide reasonable profits while keeping a lid on increases.
PhARMAâs McGee said the organization was troubled by the price caps measure. âWe believe ideas like giving the government broad authority to set prices arenât the right solution and would be harmful to innovation and patientsâ access,â he said. âInstead, insurers should share more of the discounts they receive directly with patients. Providing access to discounted prices at the point of sale could dramatically lower patientsâ out-of-pocket costs.â
In addition to legislative action, the state of Minnesota filed a federal lawsuit late last year against the three big producers of insulin â Sanofi-Aventis, Novo Nordisk and Eli Lilly â challenging the rebate and discount system that the state claims inflates the cost of insulin and increases profits for both the drug makers and pharmacy benefit managers. The suit, filed in New Jersey, was initiated by former Attorney General Lori Swanson but will be continued by Ellison.
The bills have bipartisan support, including two key Republicans in the Senate, where the GOP currently has a two-vote majority: Sen. Scott Jensen, R-Chaska, and Sen. Jim Abeler, R-Anoka, who is a chiropractor.
Jensen said Senate Republicans are open to the discussion, but he acknowledged that there are members of the caucus who oppose additional regulation. âThatâs the big one Iâm hearing,â he said.
As Little noted Tuesday,âAnytime you are limiting someoneâs ability to make money, there appears to be political problems. Yes, theyâre going to fight this, but thatâs why weâre here because it just doesnât seem like they care about people with diabetes.â
Said Howard: âI fully expect there will be some headwinds from folks who say, âWait a minute, this is too complicated. But make no mistake, that complexity works to the advantage of those with a vested interest in maintaining the status quo, those making huge profits while Minnesotans suffer.â
Jensen, a family doctor for 35 years, praised those with diabetes for raising awareness of the cost crisis around insulin. âWe all owe a debt of gratitude to all the people here today because theyâre trying to shine a bright light on something that needs to be addressed,â he said at Tuesdayâs press conference.
Yet Jensen notes that the problems with drug pricing go far beyond insulin. Drug prices have grown from less than 10 percent of health care expenditures to almost 30 percent over two decades, while hospital cost share has dropped from 34 percent to 17 percent.
âHealth care is an enormous parasite that has an appetite that wonât be quenched,â Jensen said. âThe spotlight on insulin will simply serve to spotlight the fact that we have to put a spotlight on pharmacy in general. Itâs insulin today, but on a broader market we have to look at the entire industry of pharmacy.â
One of those trying to raise awareness on Tuesday was Concordia University student Alexis Stanley, whose mother has turned down advancement because she fears losing her current insurance that covers Stanleyâs insulin and supplies.
Stanley said she worries about the time when she, like Alec Smith, will be too old to be covered by that policy. âIâd like to make a difference,â the 19-year-old said, âbut I canât do that if Iâm dead. This disease is real. None of us asked for it. So why is our life their profit?â